6 Strategies to Recession-Proof Your Foundation
Thanks to our sponsor, Blackbaud, for supplying the content to help me write this post today.
Giving USA Foundation research indicates it takes three to four years on average for charitable giving to return to pre-recession levels. While it’s reassuring that we will likely rebound from this recession too, four years can seem like an eternity for healthcare organizations already operating on razor-thin margins even before the pandemic rocked our worlds earlier this year.
Blackbaud Institute’s recent report, The State of the Healthcare Subsector: Navigating in a Time of Uncertainty, looks at how we can plan for the future based on how healthcare organizations have weathered economic, environmental, political, and social challenges in the past. Using historical giving trends as a guide, here are Blackbaud’s top 6 recommendations for bolstering your fundraising program for future success.
1. Diversify Your Revenue Mix
There is no single combination of revenue sources that works for all organizations, but in all cases it’s best not to put all your eggs in one revenue basket. The pandemic has wreaked havoc on revenue due to the cancellation of in-person events, fundraisers, canvassing, and galas, making it more critical than ever to add variety to your revenue sources to withstand the downturn. One option to consider as you evaluate new revenue streams is foundations and corporations, who are eager to show their continued support of the community during these challenging times.
2. Inspire Your Major Giving Strategy
Though the total dollar amount of donations has continued to grow since the 2008 recession, the total number of people who donated money has declined. This trend means that people who do donate are giving more than ever and points to a need to focus on cultivating major gifts. Now is the time to familiarize yourself with key wealth indicators that could signal capacity to make a major gift and to revise your case for support to show how the pandemic has affected your organization and how the organization has responded.
3. Focus on Retention
Your donor retention rate is a quantifiable indicator of how well you are communicating your mission and impact to your donors and giving them a clear pathway to continue their support. Succeeding at donor retention means less time spent acquiring new donors, a more costly and time-consuming option. Bolstering your retention efforts today increases your ability to weather the ongoing effects of the economic downturn in the near future.
4. Invest in Sustained Giving Programs
Sustainer programs increase retention and give you a predictable revenue stream amid so much unpredictability. Add to this that revenue per donor increases in the two years after donors commit to a sustainer program, investing strategically in this area is a wise move.
5. Double Down on Acquisition
Continuing to add to your donor pool is necessary for long-term growth, but in today’s uncertain financial environment it’s critical to do it in the most efficient way possible. This means paying attention to your donor acquisition cost and pinpointing the most effective tactics and channels to increase your donor base at the lowest total expense possible.
6. Navigate Your Digital Transformation
With the rise of social media, donors and potential donors increasingly prefer to engage with charitable organizations online, making one-to-one revenue sources like crowdfunding, DIY, and peer-to-peer campaigns necessary components of your future fundraising strategy. These types of campaigns continue to gain traction, since they put the donor in the driver’s seat of their own engagement, and they allow people to connect to the causes they care about using platforms they already use. Whether it is by automating manual processes or embracing new online channels, expanding your digital footprint is crucial to your success during the pandemic and beyond.
Read the full report, The State of the Healthcare Subsector: Navigating in a Time of Uncertainty, to get Blackbaud Institute’s comprehensive analysis of historical giving trends and future projections.