Year-End Giving Is Here—Are You Ready?

As Black Friday approached, I became very aware that our peak giving season is now here. For my organization, during the last four months of the year, we receive more than 60 percent of our donation revenue. I stopped for a moment the other day during lunch and wondered why giving at the end of the calendar year is so important. For many organizations, close to 40 percent of givers wait until November or December to donate, with a heavy emphasis on December giving.

In an article on Slate, "The Cynic’s Guide to Holiday Donations," Ken Stern writes that charities such as Teach for America receive more than 80 percent of their individual donations in December. Stern also notes that a 2010 Hope Consulting survey of donor habits, found that two-thirds of American donors do no research on the charities they support.

Then there's this, from Stern:

Indeed, some of the latest research suggests that Americans may subconsciously avoid finding out the facts in fear of undermining the “warm glow” they get from giving.

Instead of doing research, Americans give out of habit: Almost 80 percent of all gifts are labeled as “100 percent loyal,” meaning most people give to the same familiar brands year after year.

The point of the article is that too many people are bad at giving, and that a few rules could help them improve. But it's interesting how much we can learn from these folks. Here are Stern's five rules (in bold) with my summaries following:

1. "Go for a high-impact donation." These are charities that create the most social good. The majority of donors give to their alma maters, people they know or well-known (but not necessarily the most effective) organizations.

2. "Don’t get obsessed with efficiency." Donors who obsess over overhead have forced too many charities to neglect organizational growth.

3. "Remember that you’re on your own." There are very few people in the U.S. whose job it is to help donors make effective donation decisions.

4. "Consider who needs your help." Because of old habits, too few charitable donations (12 percent) go to human service organizations. Year-end is a chance for donors to reevaluate  their charitable portfolios.

5. "Give when you are ready." Donors should take their time and get their giving right. Even though 22 percent of all online giving occurs on Dec. 30 and 31, nothing says donors can't give after that instead.

Charity Navigator surveys donors with respect to year-end giving. These surveys ask donors if they are completely confident, very confident, somewhat confident, not very confident and not confident at all about making an end of the year gift. In a 2011 survey, for example, 70 percent of the sample surveyed said they were very confident or somewhat confident that they would make a year-end gift. Donors were split about their motivations for giving.

Three key motivating factors put forth in this survey for end of year gifts were tax benefits, receiving an appeal and religious/altruistic spirit of season influences. While charities focus on these reasons for year-end giving, the survey respondents generally did not respond to these behavioral influences when making end of year gifts. When selecting a charity, the survey respondents felt accountability and transparency were very important. The survey noted that charities could secure new donors if they emphasized their CEOs were paid reasonably, showed strong financial health and were results-oriented.

With respect to important major gifts at year end, Amy Eisenstein, in her article "5 Critical Steps to Raise Major Gifts in Time for Year-End Fundraising," writes that even end-of-year is not too late to raise major gifts.

Here are her five steps to generate year-end major gifts:

1. Check your data.
2. Pick up the phone.
3. Make yourself available.
4. Remember to say thank you.
5. Ask for a specific gift.

It is now the end of the 2016 calendar year. The good news is the stock market is at its highest point in history, and optimism seems to prevail, for now. Take advantage of any positive opportunity in the next 30 days with prospects and donors. Make hay while you can, as time is limited. Make sure you are ready to take advantage of the end of year donation focus. This opportunity will be gone before you know it.