Blog Post, Communications, Fundraising, Strategy & Implementation

Facing the Future: Fundraising Trends for 2016

September 24, 2015

With the fundraising recovery of the past several years complete, what can nonprofit leaders expect as they fine-tune strategies for the coming year? The U.S. economy continues its recovery, albeit slowly, employment is up, inflation is low, and most mainstream economists agree there’s no recession in sight. These are interesting times, financially speaking. We’ve had a historic long-term upward movement in major market indices, but now a correction or backing-off, which is a normal part of market movements. This volatility is unlikely to have a significant impact on philanthropy, as we’ve already seen a veritable flood of giving in 2015. And the year isn’t even over yet. Total giving is projected to increase by 4.8 percent.

The expectations for 2016 are similarly optimistic, with a 4.9 percent increase predicted in Philanthropy Outlook: 2015 & 2016, a report from the Indiana University Lilly Family School of Philanthropy. That’s very good news for nonprofits.

Contributions from all sources of giving are expected to increase. Giving by individuals and households will see the slowest overall growth, while giving by foundations, corporations, and estates looks to be quite strong. The increases are attributed to projected growth in personal income as well as household and nonprofit net worth.

We don’t have a crystal ball and there are no guarantees in predicting the future. However, the following trends will certainly make 2016 an exciting year for philanthropy.

Women Power. Women are a rising force in philanthropy, particularly in family giving. As women’s assets continue to grow, their financial clout increases as well. A study released last year found that more than 64 percent of charitable gifts were given by women. This group includes both boomers and older women, who are likely to outlive their spouses and assume control of the family funds. In 90 percent of affluent households, women are either the sole decision-makers or equal partners in charity giving, says a report from Bank of America Merrill Lynch. Women make up 47 percent of this country’s top wealth holders (those with assets of $2 million or more) and these women control nearly $5 trillion in assets, according to data from the IRS. Serving as the standard-setters are women like Melinda Gates, Susan and Jennifer Buffett, and Patricia Harris, who does not have a family fortune but manages Bloomberg Philanthropies.

When it comes to giving, women want their gifts to have real impact. Many women like supporting causes that help girls and women: spurring economic growth, improving literacy and health, or other issues. Their giving is thoughtful and planned and avoiding taxes is not a goal or major concern. To tap into the financial power of female donors, fundraisers should keep these priorities in mind.

Harnessing the Might of Donors. Inspired by the ice bucket challenge, nonprofits are increasingly providing fundraising how-to’s that spark donors to raise money on their own. While most experts agree we won’t see another blockbuster like the ice bucket challenge any time soon, forward-thinking nonprofits offer supporters the tools to raise money through walkathons, bake sales, lemonade stands, first communions, bar mitzvahs, and more. Think Charity Water, one of the most successful of many organizations walking donors step-by-step through the basics of launching a personal campaign. Another organization, DonorsChoose, makes it easy for anyone to help a classroom in need. It currently has almost 2 million followers. This may seem like a ‘small potatoes’ approach, but bear in mind that small increments of donations grow into mighty dollars. Since many donors clearly find the ‘do it yourself’ orientation attractive, nonprofits can plan appeals accordingly.

For Future Campaigns, Go Multi-Channel. While online giving continues its rapid growth, the majority of donations are still made of old-fashioned paper. Older donors, who give the most, are more comfortable writing those checks, while boomers and millennials embrace online giving. Therefore, fundraisers are advised to focus on multi-channel campaigns—joint online and offline solicitations—to attract and keep all donors. One study found that organizations retain approximately 58 percent of multi-channel first-time donors, as opposed to retaining less than 30 percent of offline-only donors and 23 percent of online-only donors. Mobile donations continue to play an increasingly important role in philanthropy, particularly among millennials. The year 2014 saw the transition for more web traffic coming from mobile devices than computers. So it’s vitally important that your website is responsive and therefore accessible at any time from any device.

We are following other trends that are bound to make their mark on philanthropy in 2016. We’ll take a look at them in the weeks to come.