Why Acquisition Should Be a Top Priority
We spoke at a meeting of Susan G. Komen’s peer-to-peer fundraisers from all over the country this week in Dallas. Dallas in July is a good location to focus a group’s thoughts. It was 103 degrees outside. There was little motivation to venture beyond the air-conditioned rooms at the conference hotel. As at most of our client meetings, acquisition was a major topic. The data tells us that is exactly what we should be talking about. There is a troubling trend in American charitable giving that should be sobering to every nonprofit that depends on individual giving.
First, the good news: According to the “2018 Giving USA report,” in 2017, Americans donated a record of $410 billion to nonprofits (the chart below reflects inflation-adjusted dollars). This represents around 2.1 percent of the U.S. gross domestic product, a share that has remained pretty much constant since 1980.
More reason to celebrate is that the average annual amount donated increased from around $2,000 per household in 2002 to more than $2,500 in 2014 (adjusted for current dollars). People who support nonprofit missions are doing more.
Now the bad news: The percentage of Americans donating to nonprofits fell from more than 68 percent in 2002 to around 55 percent in 2014, the most recent year for which this data is available.
This is scary. Although the economy has strengthened steadily since the recession of 2008, the number of individuals making charitable contributions has continued to slide.
This year, the new tax laws are expected to reduce the number of families making contributions further, by shrinking the number of people who are able to deduct charitable contributions on their taxes. Research by the Lilly School of Philanthropy suggests that we can expect this to result in a drop of more than $13 billion in contributions.
If these trends are present in a good economy, with a booming stock market and low unemployment, what will happen when the next recession hits?
All this means that the smart strategy is to grow your base of supporters now. It is your best hedge against an uncertain economic future.
Otis Fulton, Ph.D., spent most of his career in the education industry, working at the psychometric research and development firm MetaMetrics Inc., Pearson Education and others. Since 2013, he has focused on the nonprofit sector, applying psychology to fundraising and donor behavior at Turnkey. He is the co-author of the 2017 book, ”Dollar Dash: The Behavioral Economics of Peer-to-Peer Fundraising,” and the 2023 book, "Social Fundraising: Mining the New Peer-to-Peer Landscape," and is a frequent speaker at national nonprofit conferences. With Katrina VanHuss, he co-authors a blog at NonProfit PRO, “Peeling the Onion,” on the intersection of psychology and philanthropy.
Otis is a much sought-after copywriter for nonprofit fundraising messages. He has written campaigns for UNICEF, St. Jude’s Children’s Research Hospital, March of Dimes, Susan G. Komen, the USO and dozens of other organizations. He has a Ph.D. in social psychology from Virginia Commonwealth University and a Bachelor of Arts from the University of Virginia, where he also played on UVA’s first ACC champion basketball team.
Katrina VanHuss has helped national nonprofits raise funds and friends since 1989 when she founded Turnkey. Her client’s successes and her dedication to research have made her a sought-after speaker, presenting at national conferences for Blackbaud, Peer to Peer Professional Forum, Nonprofit PRO, The Need Help Foundation and her clients’ national meetings. The firm’s work is underpinned by the study and application of behavioral economics and social psychology. Turnkey provides project engagements, coaching, counsel and staffing to nonprofits seeking to improve revenue or create new revenue. Her work extends into organizational alignment efforts and executive coaching.
Katrina regularly shares her wit and business experiences on her and Otis Fulton's NonProfit PRO blog “Peeling the Onion.” She and Otis are also co-authors of the books, "Dollar Dash: The Behavioral Economics of Peer-to-Peer Fundraising" and "Social Fundraising: Mining the New Peer-to-Peer Landscape." When not writing or researching, Katrina likes to make things — furniture from reclaimed wood, new gardens, food with no recipe. Katrina’s favorite Saturday is spent cleaning out the garage, mowing the grass, making something new, all while listening to loud music by now-deceased black women, throwing in a few sets on the weight bench off and on, then collapsing on the couch with her husband Otis to gang-watch new Netflix series whilst drinking sauvignon blanc.
Katrina grew up on a Virginia beef cattle and tobacco farm with her three brothers. She is accordingly skilled in hand to hand combat and witty repartee — skills gained at the expense of her brothers. Katrina’s claim to fame is having made it to the “American Gladiator” Richmond competition as a finalist in her late 20s, progressing in the competition until a strangely large blonde woman knocked her off a pedestal with an oversized pain-inducing Q-tip. Katrina’s mantra for life is “Be nice. Do good. Embrace embarrassment.” Clearly she’s got No. 3 down.