The Giving Institute just released this year’s Giving USA: The Annual Report on Philanthropy. Smart nonprofit leaders use this report to make the best decisions possible for the future of their nonprofits.
While numbers and charts are great, Arthur Alley consultants analyzed the report to uncover the “So What’s.”
Here are our five key findings from Giving USA. We’ll also share what these metrics mean for your charity and the nonprofit industry so you can make informed decisions.
Finding #1: Giving to Health and Arts & Culture rebounded after a difficult 2020.
In a year-over-year comparison, Arts & Culture giving grew by 27.5% and Health giving grew by 7.7%. This is a positive sign for institutions planning a major fundraising effort and annual fundraising.
So What: Now is the time to move forward with fundraising efforts of all kinds. As always, your fundraising offer needs a strong case for support.
Finding #2: Giving to Human Services grew slightly, but much less than the previous year. For obvious reasons, giving to Human Services organizations was very high in 2020. Research shows that giving to Human Services increases during downturns and uncertain times. This giving trend tends to reverse as the economy recovers. In fact, Wwhen adjusting for inflation, giving to Human Services did decline by 2.4% when comparing 2020 and 2021.
So What: The events of 2020 produced a spike in giving to Human Service organizations that is unlikely to be repeated. Nonprofit leaders need to have realistic expectations when projecting future income and assessing current results.
This finding also reminds that storytelling, communications, and marketing should be leveraged to remind community members that needs always exist and that your organization is working to address those needs continuously. How are your community’s needs shifting in today’s world? What actions are you taking to carry out your mission boldly? If you’re looking for ways to remain relevant in your community (and in the hearts and minds of donors), this guide can help.
Finding #3: Individual donor relationships should still be your first priority, but make time for Corporate donors too.
While giving from Individuals is still the largest percentage share of total philanthropy, corporate giving increased by more than 37% in 2021 because of large pre-tax profits. Additionally, it’s important to note that giving from individuals has been steadily decreasing over the past decade. In 2011, 73% of giving was from Individuals. Now Individual giving makes up 67% of the total philanthropic impact in the U.S.
So What? While Individuals still make up the largest percentage of philanthropic dollars, wise fundraisers are “diversifying” their fundraising efforts. A great place to start is by approaching local businesses — make sure you’re clear about how the partnership can benefit their business as well as your organization! For our Salvation Army clients, this is the year to launch Corporate Christmas kettle sponsors. It’s never too early to start planning for year-end fundraising. Another idea: consider adding an appeal for Donor-Advised Funds (DAFs) in your annual fundraising campaigns.
Finding #4: Online giving grew by 12%.
From changes in donor demographics to people’s increased comfortability with online transactions, creating an opportunity for your donors to support you online is not optional. And the best part about online giving is that it’s easy to add an option for donors to “make their gift recurring/monthly” — immediately acquiring high-value donors for your organization.
This trend highlights technology’s role in all stages of the giving process: identification, cultivation, giving, and stewardship.
So What: Ensure online giving opportunities exist and communicate this giving option often on social media, print materials, etc. But don’t stop at an online giving form: Create a development plan that incorporates technology into all phases of the development process. This can include email, text, video, and yes, even phone. Ultimately, your goal is to make it simple for donors to say “yes” to you, which requires being where they are.
Finding #5: Major donors carried the day.
While giving was essentially flat among Individuals, a deeper dive indicates fewer donors gave more. Giving USA presenters used statements such as:
“Giving is top-heavy at this point”
“Giving inequality shows no sign of slowing”
“Dollars up –donors down”
to drive home the point that this trend line is likely to increase in the coming years.
So What: This data point indicates an opportunity to grow your major gifts program. Your capital, endowment, and comprehensive fundraising efforts should have even more of a focus on the top levels of your gift distribution chart. For organizations without a major gifts or planned giving program, now is the time to get started. (Arthur Alley can help!) Organizations must work to fill their Board with people willing to lend their credibility and open doors to major donor prospects.
Note: this doesn’t mean you should ignore your lower-level donors. Engaging this group is critical in building your donor pipeline and creating sustained fundraising success for your nonprofit.
For more than 60 years, Giving USA has been the most comprehensive source of charitable giving available. Arthur Alley is a proud sponsor of The Giving Institute and its annual report on philanthropy.