Fundraising experts look back at the year that was in fundraising in Australia and make some bold predictions for 2023

Digital Fundraising

The channel that keeps on growing

JEREMY BENNETT Director and Chief Consultant, Bigfoot Fundraising

As we come out of two years of lockdowns, cancelled events, workarounds and lots of emergency appeals, it’s clear digital fundraising has been a consistent area of growth and stability for most charities. 

Fundraising programs were forced to diversify, moving their efforts online to attract and engage new audiences, with a rise in virtual events and increased investment into social media advertising, including newer platforms such as TikTok. 

With Aussies in lockdown, online spending became the norm, and digital fundraising was no different. Online shopping increased 23% in 2021 (Blackbaud Index) whilst online giving increased 8% after a huge 21% growth in 2020 (Australia Post Annual eCommerce Report). Mobile usage continues to grow, overtaking desktop with 59% of the world now using their mobile devices to access the internet (Statcounter). 

With more people using mobile and shopping online, privacy and tracking have been hot topics this year. With tracking changes to Apple users since iOS14, and third-party cookie changes on the horizon, the attribution of digital fundraising is becoming harder — so we all need to get smarter. Ensuring you have the correct reporting set-up and using all available data is a must. Also, a diverse online channel mix will help ensure you reach more supporters cost-effectively. 

Looking ahead to 2023, to get the most out of your digital fundraising, I recommend a few principles that we at Bigfoot Fundraising have been using to achieve fantastic results for our clients: 

1. Video is king If a picture tells a thousand words, then what about
a video? It doesn’t take long when scrolling your feeds to see how much video has taken over as the preferred format for digital, and especially social media fundraising. We’ve seen some exceptional results for our clients when using shorter video such as Stories and Reels formats across Facebook and Instagram. If you don’t have a big budget, simple GIFs using images can be effective.  

2. One size doesn’t fit all The social media algorithm will reward you when you customise different creatives for different audiences and placements as much as possible. Don’t just develop one piece of content and push it through all your digital channels. Break it up, format it differently, write shorter vs longer ads, and create shorter videos. Think mobile-first, so develop shorter vertical videos for mobile and different, simple landing pages for mobile. Also, look at your various target audiences and develop different creative that connects with them. Creating a ‘persona’ can really help bring this to life and make copywriting much easier. 

3. Take donors on a journey Don’t make donors click and then go quiet! Investing in well thought out digital journeys that complement your offline activity is a must. Onboard properly with an engaging, delightful sign-up experience, use case study videos to deepen understanding of your cause, surprise and delight with updates, send an SMS and make an irresistible offer to donate again. With automated triggered email journeys being easier than ever to set up, there really isn’t an excuse to delay. 

4. Invest and test Despite the great returns that digital fundraising can produce and the massive growth over the last few years, it’s still a very under-invested area overall compared to more traditional fundraising channels. Getting great results and building online programs to scale takes time, resources, investment and buy-in from your organisation. It generally doesn’t happen overnight and, despite the instant feedback of digital, an adequate budget (and time) to test, learn and optimise so you can grow your digital fundraising is key! 

When testing is done right, you can really hone the creative and campaign that works for you, and then you can quickly scale up cost-effectively. See it as an investment in your vision, not just an expense. 


Corporate Partnerships

Keep calm & partner on

HAILEY CAVILL-JASPERS Chief DoGoodologist, BePartnerReady.com®

As there are no direct metrics for the current level of partnering, I tend to look at factors that influence corporates and their propensity to invest in community. Things like the state of the economy, consumer confidence, trust in corporates, retail spending, etc. Whilst economic growth is slowing, it’s still strong compared to other countries, however the rising cost of living and inflation are negatively impacting consumer confidence. There’s mounting fear of a formal recession but, and it’s a big BUT, that doesn’t mean companies will stop investing in community and causes. 

Those already on the CSR (Corporate Social Responsibility) path will not halt due to a recession, because CSR is a strategy that satisfies stakeholder demand, and the way to survive a recession is satisfying stakeholders. It’s much the same with companies that are yet to invest in community projects — when consumers are more discerning about spending, the way to win them over is by demonstrating that your company/brand is doing good. Over half of Australian consumers say they’ll switch brands this year to support a cause they care about (Conscious Consumer Research Report, November 2021). I’m also seeing a resurgence of brand-aligned cause partnerships and cause-related marketing, again driven by consumers who want to see what companies are doing, not just rhetoric.

The why and how

More nonprofits are partnering with companies and brands to achieve their mission, which is fantastic because companies are so much more than a cash cow. They can provide mission-critical expertise, bodies on the ground for major events and programs, and help get behaviour changing messaging out to a mass audience. A fantastic example of this is RU OK? partnering with KitKat to get the mental health question out to millions of Australians through more than 6000 chocolate packs and a mass market media campaign. Corporates and, in particular, FMCG (fast-moving consumer goods) brands are brilliant for disseminating behaviour-changing messaging, as well as building brand awareness. Another great example of a small charity punching above its weight is Bully Zero, which partnered with lifestyle brand Green Nation Life with a cause-related marketing campaign throughout Coles during November. Once again, a fantastic way to get the anti-bullying messaging out, as well as generate dollars for the cause. 

My bold prediction

Whilst it’s looking very likely that Australia will enter an official recession (three consecutive months of economic contraction) in the coming year, I predict that corporate investment in causes will remain buoyant or grow because in tough times, companies will have to work harder to attract and retain staff, keep shareholders satisfied, and retain customer loyalty. Advertising doesn’t do this. Investing in causes can. Nonprofits need to gear up and be ready to form genuine, mutually beneficial partnerships as companies will need to justify expenditure and show a return on investment – in both societal impact and business outcomes.

There are two levels of readiness for nonprofits to consider when it comes to corporate partnerhips. Organisational readiness to embrace partnerships, and partner readiness, which mean you’ve got all the necessary documents you need to have genuine, mutually beneficial conversations with corporate prospects. Willing a corporate partner won’t win you a partner — being ready and able will. 


Donor acquisition & retention

Don’t follow the herd

DAN GEAVES FFIA, Director, Marlin Communications

The most successful individual giving programs are built around diversity of income from single gifts, regular gifts, and gifts in wills. Such diversity starts with donor recruitment. 

Using charity benchmarking reports is a great way to develop clarity on what the health or state of fundraising is. Marlin was selected as a Primary Partner for The Benchmarking Project, and from their first ever report earlier this year it was evident that whilst the volume of single givers recruited each year has been relatively stable, the first-year income for those recruited via direct mail and online is on the rise. 

Carefully combining direct mail and digital acquisition techniques enables a charity to manage risk. By targeting different demographics in different channels, new donors can be drawn into onboarding and retention approaches aimed at driving second and third gifts. This approach reflects the learnings gained from years of investment in regular giving recruitment where it is evident that deliberate efforts to build donor commitment, trust and satisfaction helps hang on to supporters so that their lifetime value can be improved. 

Face-to-face is still the channel used to acquire the most regular givers. Yet close examination shows that two-step acquisition, combining online lead generation with telemarketing follow-up, can deliver better quality donors. But capability doesn’t offer guarantees. 

Petitions, pledges, quizzes, and value-exchange downloads are very popular, and with that has come a sharp rise in the cost of each lead generated. It is not complicated to develop a mechanic, however it is pertinent to create a testing laboratory or nursery environment in which the best activity can be discovered and scaled.

The surest prediction for 2023 is that those with a handle on their testing metrics, measurements and benchmarks will see what their own future holds, whereas others may find themselves following the herd. 

“The surest prediction for 2023 is that those with a handle on their testing metrics, measurements and benchmarks will see what their own future holds.”

Research from McCrindle has identified that younger generations are more prone to impulse giving than planned giving. It seems relevant that the tactics and messaging frames usually associated with a crisis are now in application for both charity-driven days of giving and always-on campaigns. Each has its strengths. The former offers spikes of revenue across major, mid and standard value supporters. The latter affords another opportunity to use market testing to let your audience tell you what they want to support. Each fails if the promotional messages are not integrated with donation pages. 

Looking at the friction associated with your donation flow is a data-driven way to build the case for wrestling control of your prospective and existing supporter experiences. The ballyhoo about big data can create dizzy spells, but fundraisers don’t need to lose their heads. Analysts are available to quantify the income being lost by a fundraisers’ inability to update sites with agility and test those updates for optimisation. It is predictable that those specialist analysts will remain hard to recruit and outsourcing will be attractive.

The nature of human behaviour is that it is not as rational as humans like to think it is. We tend to attribute our behaviours to our attitudes more than is accurate. Context is a massive contributing factor. And it is with this awareness that fundraisers can successfully combine tactics such as rewards, incentives, and even scarcity, with clear value propositions. 

It is still common for fundraisers to need support to uncover the victories they can offer prospective and existing donors. Those victories hold the key to developing audience motivation and fundraisers need to develop the right relationships with both story holders inside their organisation, and content creators outside. 

Doing so helps ensure that the challenge to take part in something wonderful can be brought to the audience over a series of connected prompts that are tailored to recognise that not everyone in the audience is on the same journey. When the ability for someone to give is simplified, not hindered, through technology, then success arises for the donor, fundraiser and beneficiary. 


Peer-to-peer fundraising

In a post-COVID world

LUKE EDWARDS Director, Elevate Fundraising

After a meteoric rise in income across virtual events for the past two years of COVID-19, 2022 has seen a rebalance across peer-to-peer fundraising. 

The world has now returned to a state of normality, bringing with it the ‘rebalance we had to have’ with the return of physical, host-based and community events, and the introduction of Facebook Challenges.

In 2022, the sector has seen an overall decline of income across virtual events (anywhere from 5% to 40%), and a surge of income (or at least a return to pre-COVID results) for physical in-person events. 

This decline in income in virtual events has typically been a result of reduced participant numbers, caused by increased competition and rising acquisition costs. But even with the adjustment of peer-to-peer fundraising experienced this year, we have seen increases in key metrics (average raised and activation rates) and the overall ROI is still very positive. 

As of September 2022, peer-to-peer income across our clients was sitting at $41 million raised, with income set to reach $67 million by December 31.

So, there’s no reason to panic, because the market was always going to correct itself post-COVID (but it was good while it lasted), and now we need to correct our expectations and approach for the future.

What will 2023 bring for peer-to-peer fundraising?

Focus on retention and loyalty With increased acquisition costs, there will be a stronger focus and reliance on retention and loyalty of participants. Retained participants/teams/workplaces are worth more financially, so we need to shift our approach to invest time and budget into retention and reactivation strategies to increase lifetime value, recognise and reward loyalty, and cultivate a personal legacy of support.

Smarter approach to acquisition and investment The approach to acquisition will shift from ‘achieve the lowest CPA’ to ‘attract the right people who will contribute to our success’. This includes identifying the best channels to achieve income goals, forecasting the ROI of key audiences and channels, and allocating budget to achieve specific objectives and KPIs.

Example 1 If a retained participant achieves a 10% higher activation rate and raises $120 (on average), then budget should be allocated specifically to retention activity and results tracked separately against agreed retention CPA targets. 

Example 2 For the Great Cycle Challenge, we know older participants are better fundraisers (eg, 46 years+), but we also know it costs more to find and convert them as they are a smaller audience online. We can therefore justify an increased CPA of $30–$40 more to acquire this audience, because they raise $223 more on average than the younger audience.

Our mindset needs to shift from ‘lowest CPA’, and that’s easier said than done. This also aligns with sign-up incentives and shorter one-click registration processes, as these do achieve a significantly lower CPA, but they attract participants who, for the most part, fail to raise funds.

The concept counts With the dramatic increase of virtual events last year, we saw some peer-to-peer concepts and ideas that were… not very good (and would never work in a normal market). This year has unmasked these events and their viability will be questioned in 2023 and beyond. This is largely led by virtual concepts that are too generic (eg, no defined activity or target), too confusing, or developed in response to a brief of ‘we want to be different’ (as that is a very risky approach).

The power of the people With so many more peer-to-peer initiatives and the same population size, we’re competing for attention in a saturated market. We need to get back to basics and focus on aligning values, creating a deeper connection to our cause, and enhancing the overall experience of taking part in our event. We need to inspire, motivate and entertain participants with our comms, optimise every touchpoint to keep participants focused and engaged, and increase segmentation to get the right message to each participant at the various stages of their personal journey. That approach alone will be the key point of difference to ensure long-term success. 

Too many events have adopted a one size fits all approach to their journeys, and it will come back to bite them because we can’t keep relying on merchandise incentives and matched funding days to achieve results (although they do play their part). Let’s educate, inform, engage and inspire our participants to want to raise funds and show their support. 


Major Gifts

There’s a new kid in town

ROEWEN WISHART CFRE, FFIA, Director, High Value & Strategy, Xponential

The current health of major gifts

Major gifts income and net income keeps growing. The Benchmarking Project, launched in 2022, looked at revenue of 35 medium and large charities, looking back 10 years from CY2021. 

In aggregate, the compound average growth rate over 10 years was 12.6%, excluding emergency donations (eg, bushfires and overseas disasters). Compound growth expresses the rate ‘year-on-year’ rather than as a simple average and is more helpful for annual planning. The study defines major donors as those giving a single gift/s of $5000 (or more) in one year, but the data cannot distinguish individual relationship management and direct marketing methods (eg, major gifts received by appeals). However, the method of solicitation is the single most important determinant of major gift value. The average value of gifts gained per donor by individual solicitation is over five times higher than the value gained by direct marketing (from the separate Xponential Major Gifts Benchmarking Study
for 2022). 

Using the scale of major gifts income from the starting point in 2012, the different growth rates were: largest 10 charities at 10%; next 10 (medium) at 4.6%; remainder (small) at 13%. Growth for large charities is favourably affected by the scale of staffing and systems capacity. Growth for small charities is likely to be favourably affected by growth from a low base, nevertheless this reminds us that good growth is possible for smaller organisations. 

“Australia has passed an inflection point at
which impact investment is of such a scale that
it’s a real alternative to very big gifts.”

Effective stewardship remains important for results. Major donor year-on-year retention in aggregate across many organisations has relatively little variation over long periods (like much other individual giving). The Benchmarking Project showed that over six years, retention by value in aggregate was in a small range — from 67.4% maximum in 2016 to 64.2% minimum in 2020. But there are large variations between organisations — for CY2021, retention by value for individual organisations varied from 85% to as low as 40%. Improving retention makes a big contribution. 

We’re seeing great results 

Many organisations achieve great major gift results, indicated by measures such as return on investment, retention, year-on-year increases in income and average income per donor. Common elements of effectiveness are: 

Finding and qualifying major donor prospects

Having clear cases for support and sometimes tailored ‘major gifts products’

Using prospect research to assess potential

Allowing a pace of development which suits each donor, yet also having a plan for progression

Engaging donors, aligned to their motivations

Asking individually for gifts

Thanking and telling donors about the impact of their giving

One large organisation increased its major gifts income from $15.6 million in 2021 to over $22 million in 2022 — an increase of more than 40%. This team places emphasis on donor stewardship and individualised personal communication, however they infrequently ask for specific sums from donors. Often, funding needs are expressed by a summary of the beneficiaries’ needs and the total scale of funds required. This relationship fundraising orientation also means that stewardship of previous major donors continues even when they are not in a financial position to continue making major gifts.  

This organisation has exceptionally high return on investment and high major donor retention, but its average annual gift per major donor is lower than the overall average in the Xponential Major Gifts Benchmarking Study. This example reminds us that ‘one size does not fit all’, and that major gift programs cannot be properly judged with just one measure of success.

Prediction for 2023

Major gifts fundraisers will need to understand more about impact investment. Australia has passed an inflection point at which impact investment is of such a scale that it’s a real alternative to very big gifts. In the most recent study, impact investment assets included $3 billion of real assets (mainly property), private debt, equity, and social impact bonds.  

The borrowers or equity recipients are sometimes NFPs and are often traditional fundraisers. In the past, some of this capital could have been given via direct donations. This isn’t a zero-sum game, which directly trades off donations and impact investment. Unlike donations, the investors expect to get their capital back (although anecdotally, some donate the repayment back to the NFP). So the impact investors, in this sense, are deploying capital they might never have contemplated as direct donations. This is particularly so for private ancillary funds (PAFs), which are often free to give away their capital but most currently don’t. In the most recent Xponential study, PAFs were 6% of all major donors and typically donate much more than the average individual major donor. Although PAFs are a kind of foundation, this 6% statistic includes PAFs where the cultivation and solicitation of the PAF is very similar in individual focus to that used with individual major donors. The statistic also excludes larger public or corporate foundations which require more conventional written applications and formal grant rounds. 

In large-scale fundraising, especially towards a capital asset like a building which could generate rent, impact investment is of interest for some donors (although still a minority). Hence, it is an unavoidable question for fundraisers, and one that will gradually become more common, particularly with the generational change of major donors. 


Regular Giving

It’s bounced back

PAUL TAVATGIS Director, The Benchmarking Project

2021 and 2022 have been bounce back years for the acquisition of new regular givers. The COVID-19 pandemic significantly impacted F2F. There were months where recruitment activity was unable to safely take place. 

The Benchmarking Project (TBP) data from 35 Australian charities who, combined, recruited over 170,000 new RGs last year, allows us to understand key trends as we recover from the pandemic:

F2F new starters fell by 44% between 2019 and 2020

• RG new starters fell by 32% in the same period

• We pivoted our programs from F2F into new acquisition channels but couldn’t replace the volume from F2F

• F2F is still the only way to inspire large numbers of new RGs. It bounced back in 2021 and 2022

Chart 1: Volume of new Regular Givers acquired by year and channel of recruitment

Chart 2: Income derived from Regular Givers by year and by channel of recruitment

Chart 3: Income derived from Regular Givers by year of first gift

Income figures show the power of regular giving

Income continued to dip but historic investment in our RG programs kept driving revenue — 2020 and 2021 should be the last time we need reminding that RG keeps delivering over the long term  (see Chart 3, which shows that 36% of RG income in 2021 came from donors who started giving in 2012).

Small adjustments can maximise net revenue 

It’s always hard to make spectacular improvements in an RG program outside of increasing investment in acquisition. That isn’t something that can be done in isolation. The scale of most RG programs means that small adjustments bring big rewards in net revenue. If you are looking to make new investments in RG or plan to scale up, you can incorporate those adjustments by learning from those programs already operating at bigger scales. Two big challenges: 1) cost to acquire and service is always going up; and 2) agility is critical. Make necessary adjustments in your program to keep on top of attrition. 

What we’ve seen this year

Good news: overall RG 12-month retention increased from 47.4% in 2019 to 54.2% in 2020. This is part of a trend that saw RG 12-month retention bottom out at 47.3% in 2017 after eight years of decline. A real win! F2F helps drive this. F2F-recruited RGs 12-month retention increased from 41.4% in 2017 to 46.5% in 2020. This has happened in the unusual period of the pandemic. We’ll have a better understanding of this trend from
2022 data.

What’s possible in retention?

The best 12-month RG retention rate in online lead conversion we’ve seen is from The Wilderness Society with a 12-month retention rate of 71.6%. The best 12-month F2F retention rate was from Royal Flying Doctors Service Queensland, at 76.6%.

TBP members who are doing well with their RG retention noted the benefits of taking a long-term returns view when selecting the best channels to acquire the best quality new donors. They are across their acquisition and retention programs — outsourcing the work doesn’t mean outsourcing responsibility. They pay constant attention to the data! Report and monitor in a consistent and regular way on who is giving and how they are behaving. Assess the variables impacting behaviour like age, giving level, payment method and many more, and adjust accordingly — not all RGs are the same. Choose metrics that show what has happened, but also predictive metrics that measure the long-term impact of an RG program.

Costs, ROI and net revenue headed up

In general, costs to acquire and service RGs are going up. Much of the cost of RG fundraising comes from the investment in acquisition. A lot of attention goes simply to the cost per new donor or the cost to acquire new donors this year. Critically, this is an investment in a return over time, not just a return from the activity within
a 12-month budget.

Cost over the long-term needs to be considered in assessing the net impact of acquiring new RGs. This doesn’t just include the initial return against the cost to acquire; it also reflects both ongoing cost to service and an increased value. There is potential increased value from upgrading these donors and even
cross-selling gifts-in-wills offers.

The return on investment (ROI) in some RG channels is not where we want it to be. In some cases, programs are not forecasting to break even within three years. This impacts our ability to deliver net revenue to our causes. 

There are challenges on costs and retention for some programs in some channels highlighting how important it is to segment these programs. As not all RG donors are the same, the channel of recruitment plays a big role in predicting future outcomes. 

Twelve-month retention for online recruited RG donors decreased from 82.5% in 2012 to 73.1% in 2020. As our volume of donors recruited increased, the retention decreased. Volume has increased by 60% over the same period from 6500 starters in 2012 to 10,500 in 2020. 

Online lead conversion (OLC) retention ticked up in 2020 to 59.2% but is still down from a high of 63.6% in 2012. Remembering that OLC is a new technique and programs are incredibly diverse and based on three inputs: offer, lead source and telemarketing. We should expect variability that we don’t see in established channels. Again, volumes for OLC have increased from 1270 starters in 2012 to 21,000 in 2020, an increase of 1500%.

We should base our forecasts and investment strategies on realistic retention rates.

Average gifts and inflation

Inflation also has an impact on RG fundraising. Average gifts for F2F have increased by only $4 a month between 2012 and 2021, a 13% increase. Over the same time, CPI has increased by 18%. The value of our RGs in the biggest acquisition channel is being eroded by inflation. The challenge is to increase the average gift without decreasing retention. 

Bold Predictions…

There will be a swing to quality in RG programs. We will look at investment returns over time, use our data intelligently, identify variables, test improvements, and use these to drive net revenue. Using shared insights and constructive sector-wide discussion means everyone will benefit. 


Direct mail

Not dead, again

JUNE STEWARD Director, June’s Fundraising Letter

Direct mail is still the primary channel for driving appeal funds for most of the charities we work with. When we look at appeal results, 70-90% of income is attributable to DM. Even if donors choose to give online, it’s still DM that prompted the gift. The only exception is for very small charities that have not yet made the investment into DM. 

When you combine direct mail with a deep understanding of your donors and strong personal relationship building, the results can be explosive. One example: our standout result for FY2022 was a very small health-related charity, which raised about $100,000 compared with $24,000 in 2021. This success was a combination of redefining the offer, a strong DM pack with urgency, an emotional story, and the charity’s fundraisers doing the hard yards with calling and meeting with donors. We didn’t do anything out of the ordinary, just applied standard donor-centred fundraising tactics. 

Direct mail still works to raise funds with the caveat that it must be used properly to build donor relationships and take them on an emotional journey. This is not a new idea, but many charities are still resistant to it. 

However, charities are starting to get much better at implementing all parts of the ‘ask–thank–report back’ fundraising cycle. I encourage charities to think of direct mail as more than just the solicitation appeal — the ask part of the cycle. It’s also about using mail to thank donors and tell them how their gifts have made an impact. If you leave out thanking and reporting back — and many charities still don’t do it or do it poorly — then you miss out on intensifying the donor’s joy of giving and confirming the donor made the right decision to give to your cause. These are vital parts of the donor journey and are crucial for earning the right to ask a donor for
a second or third or fourth gift. Or for a regular gift. Or the biggest gift they’ve ever given!

“When you combine direct mail with a deep understanding of your donors and strong personal relationship building, the results can be explosive.” 

One area I’m excited about is the research and testing on donor identity and wellbeing that’s being done by Adrian Sargeant and Jen Shang in the UK. Their Relationship Fundraising 3.0 report, released in July 2022, outlines their methodology and the results of recent tests, which show a significant uplift in income and response. The table above displays my high-level summary of their approach, which builds on what we already know about donor-centred fundraising. 

I’m interested in using donor identities because the approach is grounded in evidence-based research and properly constructed tests that have been replicated across different fundraising sectors. Used well in direct mail, it has the potential to increase income, deepen donors’ connections to their charities and increase donor wellbeing — which leads to more and higher gifts. 

Although yet to be tested, it’s possible that using donor identities can alleviate some concerns of those opposed to the ‘donor as hero’ narrative. The Relationship Fundraising 3.0 report says: “Using the ideas we have articulated, it is within the fundraiser’s gift to select specific identities to focus on — and to carefully reflect on what aspects of those identities should be the focus of attempts to grow wellbeing. In simple terms we can change what we choose to help people feel good about. Supporter journeys can thus be created that result in the welfare of both the donor and the communities that they choose to support. More communal relationships can be developed that educate donors about their role in bringing about change and how the love that they have to offer might be better articulated, channelled, and experienced.”

If this could be successfully tested and implemented, it would go a long way towards resolving the endless disputes over the ‘donor as hero’ narrative in direct mail. 


GIFTS-IN-WILLS

Invest more!

MARCUS BLEASE Co-founder and Co-director, Donor Republic

What is the current state of Gifts-in-Wills?

For some time, Donor Republic has been championing gifts-in-wills (GIW) as the area that will power fundraising growth over the coming decades. Recent benchmarking reports have provided evidence that this prediction is coming true with regular giving dropping from the top spot and GIW generating the largest growth in the sector both in percentage terms as well as actual revenue, which has doubled over the last 10 years.  

Whilst this creates the appearance of success for our sector, when you scratch beneath the surface, not all is rosy. Over the same 10-year period, the growth in number of GIW has been stagnant. This means all revenue growth is from increased estate sizes, largely because of asset price increases. Sadly, as a sector we are not encouraging more Australians to leave a gift in their will to charity, which is worrying. Especially when we contrast this to other nations where they have experienced steady increases in people choosing to leave a gift over the same period. 

Through our work assisting many charities with their strategic plans, it is very clear that we are under-investing in this area. It is not uncommon for charities to invest 5%, 2% or even as a little as 1% of their GIW revenue back into program growth, which would not be acceptable in other areas of giving. We recommend 10% to 20% for a balanced GIW investment across marketing and relationship management.

GIW fundraising is viewed as a long-term investment, but we are expecting to see the largest ever intergenerational transfer of wealth over the coming decades as the Boomer generation passes. If we do not increase the amount of investment in GIW marketing, the opportunity cost to all our worthy causes will be unimaginable. 

What have you seen in GIW that is leading to great results?

It is wonderful to see several NFPs embrace GIW across the entire organisation, giving GIW training to all (including during orientation for new staff, in GIW marketing immersion for the fundraising team, and in GIW conversation and identification guides for donor relations teams), ensuring everyone understands they have a role to play, celebrating together when gifts are made and embedding KPIs — such as GIW mentions — across all teams. The first step in this journey is leadership support and prioritisation. This is common in the northern hemisphere but sadly still rare in Australia, so it is great to see some charities taking these steps as we know this will have transformational effect on their long-term revenue. 

An exciting development is how well Facebook is performing in both generating leads to GIW programs and helping move people down the funnel. We are working with several charities experiencing strong results, attracting supporters straight to a GIW conversation and bypassing the traditional donor pyramid approach — and all at really competitive cost per prospect rates! Whilst several factors influence cost per prospect, anywhere between $10 and $40 is considered good. Emotive, inspiring GIW content appearing in everyone’s newsfeed can only help seed the idea for the many who are not yet ready to leave a gift. 

Donor Republic brought GIW fundraiser Richard Radcliffe over in 2019 and he encouraged us all to use ‘1% language’ to help increase consideration levels amongst people who believe a gift in a will must be large. Simple lines such as ‘A gift of even 1% after you’ve taken care of loved ones can help save more lives from heart disease.’ This concept has been taken up by many charities we partner with, and it is good to see this approach evidenced by nonprofit consultants, More Strategic, in their recent research project. Using the 1% line increased consideration of leaving a gift by 28%. For those considering a percentage rather than a fixed amount, the increased consideration was 55%. 

What is your 2023 prediction for GIW?

My prediction (and hope!) is that charities realise we need to invest more in GIW for longer-term growth, but that investment is not in mass marketing alone, or relationship management of prospects alone. Successful GIW programs are a combination of both. Programs that focus solely on mass marketing often experience realisation rates as low as 20% due to lack of stewardship versus a sector average of 60% to 70%. Charities that focus too much on relationship development and not enough on marketing the idea experience lower volumes of gifts, reducing their potential income. It is not just about increasing investment, but getting the balance right too. 

 

To learn more about the State of the Fundraising Nation, read how these fundraisers and their causes are doing.



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