Most fundraisers have not experienced a time of high inflation.
So I wouldn’t be surprised if you’re worried. Is inflation going to undermine fundraising results? Are donors going to pull back in a significant way?
I don’t know. Nor does anyone else. But we can make some reasonable guesses that can help guide our fundraising strategy.
Here are some of my best guesses:
Bad stuff that might happen and how you can respond
Donors could pull back and give less. Inflation is pinching the pocketbooks of many donors, especially those living on fixed incomes. They may be getting choosier about where and how often they can give. Maybe they’ll drop two of the five organizations they support. Stay at the top of their list by staying in touch, asking in relevant ways, and thanking them promptly and powerfully. Donor love will keep you on their list through thick and thin!
Major donors could pull back. This could be an even bigger worry, and it’s also possible. While wealthy people are less impacted by inflation, they are more impacted by how their investments are doing. With the markets doing poorly, some high-end donors may be feeling pinched. The solution for them is the same as for all donors. Stay in their lives. Treat them with love and respect.
Costs of fundraising will go up. This is already happening, and it can make life hard for us fundraisers. The cost of paper historically goes up faster than general inflation, so what it will do in high inflation is a bit scary to think about. Add to that shortages and supply-chain disruptions, and you have a situation you can’t ignore. You may need to simplify direct mail and other printed materials to keep costs down – though not when contacting your high-value donors. You may also need to mail less to low-dollar and deeply lapsed donors. On top of that, the cost of delivering your services is increasing, putting even more pressure on your fundraising to perform.
Costs of people will go up. This also is already happening, and I just have to say, “It’s about time!” The nonprofit sector has been underpaying for far too long, relying on the good hearts and mission focus of their people as a way to avoid paying them decent wages. It may be a challenge, but you have little other choice than to increase wages. This may be the thing that puts more poorly-run nonprofits out of business than any of the other challenges we face.
Smart things you should do
Keep asking. Donors want to donate, especially when need is relevant and evident. It’s one of the joys of their lives. If the need for your services is increased by inflation, let donors know. If the cost of delivering your services is going up, ask your donors to help! One thing the pandemic taught us so clearly was that when things get tough and you let donors know, they respond!
Stay mission-focused. You might be tempted to go to donors and say, “Please help us during these challenging times!” That misses the reason most of them give to you. They give because of what you do. Not just because you exist. (Unconditional love is your mom’s job – not your donors’.) “Please help people in need during these challenging times” is the message that works.
Up your thanking. The state of donor thanking across the fundraising industry is shamefully bad. It’s simply ignored or done sloppily by far too many. The upside of that for you: It isn’t hard to stand out in the crowd of your donors’ causes. Thank donors promptly. Through the mail (even online donors). Be relevant to them, thanking them for what you asked them to do. Don’t use your thanking to brag. Doing these things will pay off quickly in more donations and more loyalty.
Acknowledge donors’ agency. Let them know you understand times may be hard for them. Give them “permission” not to give – or to give less. It’s far better to keep the relationship at a lower dollar value than it is to lose them entirely.
Build resilience in your organization. Doing best-practice fundraising will help you weather all storms. Get closer to mid and major donors (asking them to provide match funds helps here). And invest in Gift in Wills programs – there is more money for your cause there than anywhere else.
One thing you MUST NOT do
Don’t make the choice for donors that they won’t give. No matter how scared you are that they might do so. The choice to give or not is theirs, not yours. But if you don’t ask, nearly all of them won’t give. Because going silent on them is the clearest possible way to tell them you don’t need them! In every crisis I’ve been through – from the many recessions to terrorist attacks, to the pandemic – the greatest damage done to nonprofits has been self-inflicted. Organizations that decided donors won’t give.
Don’t guarantee failure. Keep in touch and donors will stay with you.
We’re offering an all-new and FREE Moceanic webinar called Fundraising in the Face of Inflation, Recession and Other Storms. Long-time fundraising expert Sean Triner will show you the practical steps you can take now to keep donors close and income flowing. The free webinar will only happen on September 14/15. Only a limited number will be able to attend! Sign up here!
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