5 Fundraising Trends for Growing Nonprofits in 2020

Just like that, we went from talking about the rising trends in fundraising for 2020 to how nonprofits can sustain operations during the COVID-19 pandemic. Needless to say, it was quite the pivot in conversation.

The COVID-19 pandemic has had major implications for nonprofit organizations. Unfortunately, it seems as though the uncertain landscape created by the COVID-19 pandemic will be sticking around for the foreseeable future. With that in mind, it’s time for your organization to consider how it can be agile and thrive through uncertainty.

The conversation is no longer around staying the course through the pandemic. Instead, how can you shift your strategy for 2020 to be successful over the next 6-12 months of uncertainty?

This year has seen the rise of a few fundraising trends that might help your organization do so. While these trends are slightly different than those that were initially hypothesized at the tail end of 2019, they will be equally valuable to capitalize on.

When creating your new strategy for 2020, consider trends such as:

• The reliance on new technologies for impactful conversations
• The move to a flexible work environment
• The decision to solicit year-end giving now
• The turn to donor-advised funds
• The continued election effect

The uncertain landscape created by the COVID-19 pandemic is sticking around for the near future. Explore how your nonprofit can use the 2020 fundraising trends to thrive through and beyond the crisis.

As you read, remember that your organization can consider bringing in a fundraising consultant to help navigate the trends. Let’s dive in.

The reliance on new technologies for impactful conversations

Long before the pandemic hit, one-on-one conversations were heralded as the best possible method for building relationships with key supporters.

Organizations planning a capital campaign were recommended to conduct a feasibility study, interviewing key stakeholders to gain feedback and build support. Similarly, nonprofits building their major gift programs were encouraged to hold luncheons and meetings with potential givers to begin growing those relationships.

The value in those conversations hasn’t changed as 2020 has progressed. However, the COVID-19 pandemic has made those conversations significantly more difficult to conduct. With necessary social distancing measures mandated by the CDC, these in-person engagements can no longer go on as planned for the near future.

Because of this, one of the biggest trends for fundraising in 2020 is using technology to stay connected. However, we’re not just talking about sending out an email newsletter. In addition to your regular communications, consider:

• Video conferencing software: Consider taking phone calls with supporters to the next level by incorporating video. In a time when many are feeling disconnected, a friendly face is appreciated!
• Live streaming: Consider live streaming moments where your nonprofit team is hard at work, showing supporters that their most recent donations are truly going toward a good cause.
• Social media: Share both new and archival images, videos, and stories of your organization at work to give supporters a behind-the-scenes look at your efforts.
• Virtual events: If you had planned fundraising events, avoid canceling them. Instead, get creative and hold a virtual event. Take a look at this SoapBox Engage guide for inspiration when getting started.

It’s entirely possible to continue building relationships with supporters during COVID-19, especially if you get creative with technology. And, your nonprofit’s donors can still show their support in return— just through virtual means!

The move to a flexible work environment

In 2019, before COVID-19 became a reality in the U.S., nonprofit professionals were already anticipating a move to flexible working environments. This was due to studies showing that:

• Over half of fundraisers expect to leave their current nonprofit within two years, while one-third plan to leave fundraising overall.
• Over half of fundraisers report feeling under-appreciated for their efforts.

Data such as this creates concern around nonprofit staff turnover and what organizations can do to combat that. In 2019, one rising idea was creating flexible work environments that allow nonprofit professionals to work from home and benefit from an increased emphasis on paid time off.

That was before the pandemic hit. Needless to say, this trend is more important in 2020 than ever before.

If your organization is able to do so, creating a flexible working environment in which staffers are able to work remotely is a great (maybe even essential) step toward a happier nonprofit team. Here are a few tips to help you make the shift to working remotely:

• Maintain a regular schedule as much as possible. Begin and end the workday at the same time each day.
• Maintain a regular meeting schedule. The weekly meetings you would have had pre-WFH can and should still go on!
• Use video whenever possible. Hold meetings using video conferencing software to emulate the in-person meeting experience.

When your nonprofit’s staff feels appreciated, they’re more likely to stick around. This leads to fundraisers that are more knowledgeable, invested in your mission, and successful in the long run!

There’s an argument for building a strong work from home infrastructure, and then continuing this beyond the pandemic. Consider the efforts you’re taking now as a trial run— you may find that this period is valuable enough to continue the practice going forward.

The decision to solicit year-end giving now

COVID-19 has made communities more in need of nonprofit support than ever before. At the same time, many donors have less to give due to the continuing economic downfall. It’s become essential for organizations to adjust course, especially if all of their fundraising “eggs” were in one basket.

Many nonprofits hold extensive year-end giving campaigns through which donors make major gifts to round out the end of the year. Often, the same donors return each year as loyal supporters.

Nonprofits looking to outlast this crisis and continue providing essential services to their communities need to pivot their fundraising strategies and goals. One way to do so is to consider soliciting year-end donations now.

Often, nonprofit professionals hypothesize that year-end giving is due to the tax breaks associated with giving. However, it’s just as likely that year-end giving is a result of the generally positive sentiment associated with the holiday season, which encourages generosity in supporters. In a similar manner, times of crisis bring out the generosity of those able to give.

Consider reaching out to the donors with an observable year-end giving history and asking them to make their year-end gift now, rather than in December. And, if you need more convincing— just check out the recent #GivingTuesdayNow campaign that drew on this same concept.

The turn to donor-advised funds

Donor-advised funds (DAFs) aren’t exactly a new funding source, but they have been growing in popularity in recent years due to tax incentives for those who contribute to them.

Essentially, these funds are a form of philanthropic giving where donors deposit their gifts into a “charitable savings account” of sorts, without immediately specifying a beneficiary. These donors receive a tax benefit when they contribute to the account initially, and the account is managed by a financial service as it grows over time.

Eventually, these funds are donated to a nonprofit organization. We believe that DAFs are going to be trending with fundraising in 2020, in particular, because:

• Many donors are unable to make direct financial contributions at this time. The continuing economic downturn is making some supporters apprehensive to give financially. However, if they’ve given to a DAF in the past, they can direct those funds to nonprofits without actually spending any more.
• They’re often managed by large financial firms. Donor-advised funds are one of philanthropy’s fastest-growing vehicles and as such, many are managed by large financial services firms. This can be an attractive prospect to donors due to the level of support and management oversight.
• Many major donors contribute to DAFs. These funds have been growing in popularity with major donors due to the associated tax incentives. There’s a decent chance that some of your organization’s biggest supporters contribute already!

Some nonprofit professionals have felt apprehensive about asking supporters to make gifts during COVID-19. This impulse is understandable, since people are focused on health and safety, and many have lost their jobs.

However, DAFs allow donors to contribute to your organization without paying more out of their pockets. Research these funds, both within your existing donor base and outside of it, and begin stewarding those relationships and soliciting gifts. To begin researching DAFs, check out this resource.

If your organization needs help navigating this research, you can bring in a fundraising consultant to help navigate the process— something you can learn more about in this Aly Sterling Philanthropy guide.

The continued election effect

In 2019, nonprofits began preparing for the election effect hitting in 2020. The election effect refers to the impact nonprofits feel during presidential election years, when donors tend to give with a higher fervor.

During election years, presidential candidates are regularly placed in front of donors to speak about the issues and causes they intend to tackle if elected. This raises awareness of those causes and, as we’ve seen in years past, this increased awareness sends donors toward the nonprofits working on those causes.

According to data gathered by Classy, the 2016 election resulted in:

• An increase in recurring donations.
• An impact on civil rights-related organizations, which saw the biggest boost.
• Recurring donations that continued for a longer period of time.

2020 is an election year and nonprofits should expect a similar election effect to take place. However, it’s important to understand how the COVID-19 pandemic could play into that. For example, this year, organizations working in public health may see a larger boost.

But how can your organization make the most of the election effect when building a new fundraising strategy? You can pay attention to the election, specifically to instances where your cause is referenced on the campaign trail. When that happens, consider using those current events in your messaging.

While they may be slightly different than anyone had predicted, the rising trends for fundraising in 2020 could go a long way in helping your organization thrive through the crisis.

From donor stewardship and digital communications to the presidential election effect, harnessing these trends now will position your organization to be successful over the next few months of uncertainty.

About the Author:

This article was authored by Aly Sterling, Founder and President of Aly Sterling Philanthropy, a partnership-driven consulting firm for nonprofits.