Category Archives: Donors and Giving

Small Nonprofits Must Make Big Gains in 2012

Giving USA: The Annual Report on Philanthropy, issued recently by the Giving USA Foundation and its research partner, the Center on Philanthropy at Indiana University, is considered the most reliable and prominent resource for information about trends in charitable giving and announced that giving increased modestly last year.

Charitable giving in the United States increased in real dollars in 2011 by 4.0%, reflecting the second consecutive year of collective higher charitable support from individuals, corporations, foundations, and bequests, according to the annual landmark report that has tracked philanthropy for more than 50 years.

With the issue of the Report came some important highlights that reflect significant pressures facing the 1.1 million nonprofits and another 222,000 religious organizations across the U.S., including changes in behaviors by American donors of all types, especially individuals who collectively represent 88% of all giving.

The 2011 estimate of $298.42 billion represents growth from a re-stated figure of $286.91 billion given in 2010.

Giving USA: The Annual Report on Philanthropy has detailed annual estimated charitable contributions by Americans – and how they are used – since 1956, making it the longest-running study of its kind.

The Report does not show changes by any one organization or regions across the country; rather, it reflects total giving by 117 million households, approximately 12.4 million corporations, an estimated 99,000 estates, and approximately 76,000 foundations.

Among the highlights of the GUSA Report for 2011 are several critical observations that have likely relevance to small-to-medium-sized nonprofts. Most notably we observed the following trends and implications:

Giving to Religion

Giving to “houses of worship” in the U.S. remains the largest single category attracting donor support, but for the second consecutive year, this sector reflected a decline in both total dollars given and as a percentage of overall giving.

Giving to religion, making up 32% of all giving, declined by 1.7% in real dollars and 4.7% in inflation-adjusted dollars. This decline is attributed to a steady decline in religious affiliation across the country in all denominations.

Giving to International Issues

Giving by all sources to international organizations grew a remarkable 240% in current dollars, or 167.1% in inflation-adjusted dollars between 2001 and 2011, and 7.6% alone in 2011.

While there were no major international incidents in 2011 that garnered major support (excluding the Japanese tsunami), we suspect that very large donors, including the Gates Foundation, are still supporting international projects in substantial ways.

Giving to Education

Education, specifically support for colleges and universities, saw a 4.0% increase in giving, and it remains the second largest sector that donors support. Very large capital campaigns returned to college campus fundraising efforts in 2010 and 2011, and impacted this aspect of the nonprofit world.

Giving to Public-Society Benefit

Charitable support for traditional “umbrella organizations” increased by 4.0% in 2011. However, this category’s figures are clouded because once again GUSA included dollars attributed to donor advised funds as well as to United Ways and the Combined Federal Campaign into the overall calculation. Incoming funds to donor-advised fund administrators grew collectively 77% between 2010 and 2011.

Several other highlights from the GUSA 2011 Report include the following:

  1. Support for nonprofits via bequests increased 12.2% to an estimated $24.41 billion.
  2. Giving by foundations did increase 1.8%, however when adjusted for inflation giving by foundationsdeclined 1.3% in 2011.
  3. Giving by U.S. corporations and their foundations held steady at $14.55 billion.
  4. Giving to human services nonprofits rose an estimated 2.5% last year and is the third-highest amount ever recorded (behind 2008 and 2010)
  5. America’s charities face many challenges including increasing competition from more than 1.1 million nonprofits and an economy that is recovering far slower than we have witnessed following previous downturns.
  6. The “best” year for giving ever was 2007, when GUSA reported $309.76 billion in charitable support. The 2011 results are the closest that total giving has been to $300 billion since 2007.

The complete GUSA report as well as an executive summary is available now.

Adapted from an article featured on eJewishPhilanthropy.com on June 19, 2012. 

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2012 Update: Social Media and Nonprofits

You’re going to want to tweet this: in response to May’s “Question of the Month,” 24% of respondents claimed that social media was the best marketing tool for nonprofits. “Word of mouth” and the organization’s own website tied for first place, each netting 29% of respondents’ votes.

http://onlinebusiness.volusion.com/articles/word-of-mouth-marketing-introduction/Not surprisingly, some nonprofits are turning to social media as a means to disseminate their missions, visions, and values. The Fourth Annual Nonprofit Social Network Benchmark Report reported that in 2012, 93% of U.S. nonprofit organizations have a presence on one or more social networking websites.

However, there are still many organizations that have no social media strategy to speak of. The answers to this month’s question reflect a number of trends we’ve noticed developing over the last few years:

  1. All nonprofits do not yet understand the power of social media.
  2. The priority placed on social media as a “connection tool” is sporadic and seems to  be used primarily by very large and very small nonprofits.
  3. Creativity relating to marketing remains very traditional. Even though everyone has a website and therefore the capability to connect with users via an interactive interface, many don’t.
  4. Impersonal marketing still dominates the landscape, and nonprofits suffer for it.

Over the last five years, many nonprofits have transitioned to using Facebook and Twitter as ways to build a donor base and market themselves to supporters. However, there is still a great deal to be learned about just how effective a tool Facebook and Twitter can be.

An astounding 98% of respondents to the Report indicated they have a presence on Facebook, offering many potential opportunities for fundraising. However, 53% of respondents said that they were NOT using Facebook for fundraising at all. 

Some organizations are opting for a modified social media fundraising approach. According to Robert Strickler, the Donor Pages Product Manager at DonorPerfect Software, an increasing amount of nonprofits are turning to what he calls a “donor driven” approach.

His firm has developed Donor Pages, an online “friend to friend portal” where an organization recruits its supporters to set up a website where they can reach out to family, friends, and colleagues and personally ask them to donate.

“Using a page like this gives ownership to the online social fundraising experience,” says Strickler. “We find that this tends to be effective because it operates on a more personal level.”

Just like fundraising through direct mail, meetings or phone calls, the same rules of stewardship are just as critical to online fundraising. Connection – genuine, heartfelt, and personal – is the key to fundraising success.

Adapted from “Social Media and Jewish Nonprofits: Missing in Action?” originally published on February 15, 2012 via eJewishPhilanthropy

Putting Transparency & Accountability Into Practice

Many members of the American Jewish community have felt a strong connection to Israel. For years, they obligingly gave to Israel-based organizations consistently and heartily…but times are changing.

Time has demonstrated that trends in America’s nonprofit sector arrive in Israel only a few years later. Therefore, it is only a matter of time before Israeli donors see the logic and match their American counterparts’ demands.

Hundreds of Israel-focused nonprofit organizations represented in the U.S. seek charitable support from American donors every year. Why do some receive it…and others don’t?

Nonprofit experts Shuey Fogel and EHL Consulting’s Avrum D. Lapin will join together to discuss the “new normal” in the American fundraising arena for Israel-based organizations, highlighting generational shifts that have critical implications for nonprofit leaders as they try to raise funds in Israel and abroad.

Topics will include:

  • Transparency: How new donor expectations are changing the ways Israel-based nonprofits operate.
  • Accountability: What outcomes nonprofits must demonstrate to their supporters, and why today’s donors are more demanding than ever before.
  • Differentiation: Why nonprofits must communicate with clarity, and how best to make the mission stand out in a cluttered marketplace.

Adjusting to the “New Normal”
Putting Transparency and Accountability into Practice
Thursday, June 14th
9:15 – 11:30am
Talpiot, Jerusalem

This seminar is being offered free-of-charge.

For more information or to RSVP: jfogel@u-bank.net