You’re out for a bike ride and you see a big hill ahead. Do you slow down? No, you build up speed because momentum will help you get over the hill faster and easier.
COVID-19 is a mountain we’re all still climbing. Recovery is on the other side and we’re headed for it. Knowing what happened in 2019 is key to understanding how soon we’ll get there.
That’s why GIVING USA: 2020 matters to each of us today.
Winkler Group Principals Jim Bush and Jessica Browning each serve on the Editorial Review Board for Giving USA. Below are their key takeaways from the 2019 data and how we can use this data today.
Takeaway #1: Giving in 2019 was Strong
2019 was a near-record year of philanthropic giving. Total giving reached $449.64 billion in 2019, a 4.2 percent increase in current dollars and a 2.4 percent increase in inflation-adjusted dollars. Clearly, momentum is on our side in 2020.
Takeaway #2: The Biggest Winners
Giving to all sectors (except International Affairs) rose in 2019. These four sectors saw the greatest growth:
- Public-Society Benefit (13.1% increase in giving)
- Arts/Culture/Humanities (12.6% increase in giving)
- Education (12.1% increase in giving)
- Environment and Animals (11.3% increase in giving)
Takeaway #3: Donor Attrition
These statistics continue to baffle and anger us. Donor retention rates continued their 5-year slide; only 45% of donors who gave last year will give again this year. Only about 20% of NEW donors will give a second gift. Think about the effort we’re wasting by letting these donors—people who have already expressed interest with their a gift—walk out the door. Instead, pay attention to your donors and build real relationships with them. Raising your donor retention rate by just 1% can yield $20,000 in annual revenue.
Any nonprofit that saw new donors during the COVID-19 pandemic MUST pay attention to depressing retention statistics. Make a plan TODAY of how you’ll to retain these new donors in 2021. If not, they will take their philanthropic dollars elsewhere.
Want to learn simple ways to increase your donor retention rates? Watch this webinar. (link to our webinar on donor retention)
Takeaway #4: Mega Gifts Dominate Once Again
Giving by individuals fell in 2019 as a percentage of total giving (69% in 2019 vs.72% in 2014). But don’t misinterpret this data to assume a major shift in who is giving. Corporate giving remains flat at 5% of total giving in both 2014 and 2019. The real story is the growth in giving by foundations, which was only 11% of total giving 15 years ago but is 17% today.
Why the change? Those who give the most are shifting how they give. Ultra-high-net-worth individuals are giving through family foundations and donor advised funds rather than making outright gifts. The shift to fewer but bigger gifts continued in 2019.
This doesn’t mean that you should ignore your mid-range and lower-level donors, but you should prioritize your time and view your major donors as investors. If you receive a donation through a DAF, make every effort to develop a relationship with the DAF holder—or the board members of a family foundation. Steward them the same way you steward individual donors.
Want to dive deeper into Giving USA numbers? Need advice on how to reset and grow your fundraising? Schedule a FREE 30-minute strategy session with one of our senior consultants today.
