by Jeff Small

The Council for Aid to Education (CAE) released the results of its annual Voluntary Support of Education (VSE) Survey today which estimates the total and variety of gifts to colleges and universities in the United States over the last year. 

According to the survey, giving to colleges and universities increased 2.3 percent to $31 billion in 2012, falling just shy the high water mark set in 2008 of $31.6 billion. 

In general this tracks with giving to the nonprofit sector and the economy as a whole over the past two years, where slow growth has followed the abrupt collapse of the Great Recession.

Another statistic that is reflective of this slow growth is the fact that around half (52.8 percent) of institutions surveyed raised the same or more than they had in 2011, while the other half (47.2 percent) reported declines in giving.

One of the more interesting findings of the survey, from my perspective, was the fact that giving for capital purposes dropped 3.2 percent while contributions for current operations increased 6.2 percent. 

The balance of giving for capital and current operations has experienced a number of fluctuations in recent years, with donors shifting away from capital giving as the economy contracted and shifting back towards capital giving as the economy rebounded.

The CAE points to a strong correlation between giving for capital purposes and the growth and decline of stock values on the New York Stock Exchange. When stock values have increased or fallen, giving for capital purposes has fallen in near lockstep.

The drop in giving for capital also appears connected to a slight decline in giving by alumni.  Total giving by alumni declined 1.3 percent in 2012, despite the fact that alumni giving for current operations increased by 10.8 percent.

So what do these findings mean for you and your institution?

First, it is important to not interpret a climate study as a local weather report.   By that I mean that while it is important to know the currents that are driving the overall system, it is equally or more important to know your own local conditions.

Slow growth in the sector does not mean your organization must be resigned to slow growth, nor does a shift away from capital mean your donors who have expressed interest in capital gifts will suddenly pull away. 

It does, however, give us an important insight into donors and their collective mindset.  As we’ve seen repeatedly in studies like this one, Giving USA, and the Nonprofit Fundraising Study, donors continue to be slow to return to pre-recession giving levels, but they are re-engaging gradually.

So if you want giving at your institution to increase substantially in the near term, you can’t depend on a rising economic tide to make it happen.

You can either cross your fingers and wait for the proverbial lightning strike, or you can make strategic investments in proven fundraising practices that increase donor contact, grow donor relationships, improve internal efficiency, and build a fundraising infrastructure that can withstand the ebbs and flows of the larger philanthropic climate.

by Ted Grossnickle

A well-thought out paper from the American Enterprise Institute has really captured my attention recently as it highlights the coming sea tide of changes facing in Higher Education.

In his paper “Disaggregating the Components of a College Degree,” Michael Staton has taken a unique and analytical look at what exactly colleges do and the inevitable impact as an online world increasingly begins to compete with them

While it is still to be determined if online education courses produce strong learning results or if a profit can be made from them, we must admit it will challenge our traditional ways of thinking of higher education and that change is bursting on the horizon.

In many ways, higher education is the Wild West right now, responding to a variety of pressures and rapidly facing enormous changes.

With those challenges in mind, I encourage you to take the time to read this thoughtful paper.

It provides a fresh and challenging look at higher ed and the components that make up what we today think of as a college degree. Staton methodically looks at the elements of higher education and separates them into four parts that make up the entire education package, identifying what things colleges and universities do well and those that could be delivered more effectively using technology. I admire the way Staton is using the component parts of a college degree to help us better understand the whole. His way is certainly not the only way you could break it down, but definitely a good start.

Staton’s paper also provides a reasonably quick tour of the myriad challenges in the industry as of the time of its writing 6 months ago – an eternity ago in today’s thinking – but these are pressures we will be facing for years to come.

I encourage you to use Staton’s paper as a platform to advance your own thinking and explore what others are doing in reaction to the pressures. Staton makes clear that students and their parents may increasingly view College in an “unbundled” way.

The challenge for leaders of today’s institutions is to determine how they can create a new hybrid delivery vehicle that can deliver content more effectively, but still provide a branded, united college experience that provides those things that technology cannot.

The challenge for us as fundraisers is to increase our understanding of what comprises a college degree and our institution as a whole and how we might rethink and articulate for donors the opportunities that will exist within colleges that soon will start to do things differently..

As advancement officers, we need to begin thinking about the following questions:

• What will unbundling do to the community of our institution?
• What things do we do well that can’t be done online?
• Do we know how to describe those persuasively?
• How can we leverage those things we do well to differentiate ourselves to students and to our supporters?
• How do we remain valuable to our students, alumni, and donors in an unbundled world?
• What new opportunities does an unbundled college education present for us?
• How can we leverage alumni relationships and mentoring to prevent unbundling from fragmenting our campus community?

There is no one set of answers to these questions.  They will vary by institution, as will the impact of unbundling.

I encourage you to begin considering these important issues sooner rather than later. I would welcome the opportunity to sit down with your leadership and think through the impact of these new challenges.

by Dan Schipp

Is it time for nonprofits to rethink their donor engagement model? 

That’s the question raised by Julie Dixon and Denise Keyes of Georgetown University’s Center for Social Impact in their excellent article, “The Permanent Disruption of Social Media” (Stanford Social Innovation Review, Winter, 2013).

For decades nonprofits have employed the ladder or pyramid approach to cultivate donors and build relationships with them. 

This traditional model relies on direct mail, phone calls and events to introduce prospective donors and volunteers to an organization. 

Then through more and more direct and personal contact (personalized mail, volunteer opportunities, face-to-face meetings, etc.), the supporter advances up the ladder or pyramid and is cultivated and solicited for larger and larger gifts, culminating in an ultimate gift, usually a bequest. 

Ms. Dixon and Ms. Keyes argue that this orderly and linear process is no longer sufficient in an Internet and social media world. 

They maintain that a new model of donor engagement is needed, “one that is more fluid and continuous, and that better reflects the growing importance that a person’s influence plays in the process.”

What does this new model of donor engagement look like?  In their article, Ms. Dixon and Ms. Keyes provide five characteristics:

• Allows for a donor to be engaged at different entry points and to move easily between them during the life cycle of her engagement
• Has no fixed end point for a donor’s engagement
• Allows for the donor-engagement footprint to expand or contract in ways that are unique to and driven by the individual donor
• Places the donor’s needs – not the organization’s – at the center of the engagement
• Accounts for the influence of other people on the strength of the donor-organization relationship.

Ms. Dixon and Ms. Keyes propose an intriguing image for their new model – a vortex. The individual is at the center of the vortex. 

The depth of the individual’s commitment to the organization (in the traditional model this is conveyed by high up she is on the pyramid) is represented by the size of the continuous field around the center.  As the supporter’s commitment deepens, the vortex expands outward. 

In this model there are no specific steps upward or downward but rather a continuous flow of communication and engagement that fosters further communication and engagement.

Several of the goals of the vortex model resonate with the findings and recommendations of the Millennials research conducted by our firm and Achieve in 2012 (The Millennial Impact Report 2012):  

• offer supporters a tailored portfolio of involvement in line with their interests and strengths, and,
• provide a continuous conversation in which various engagement opportunities are presented. 

To stimulate your thinking (or re-thinking!) about how best to engage supporters, especially the millennial generation, in this social media age, I recommend reading “The Permanent Disruption of Social Media.”

by Angela White

Happy 2013!

Somehow it seems like we were just worrying about Y2K bug as the calendar moved from 1999 to 2000 and here it is 13 years later is what seems to be a blink of an eye. I know…. time passes more quickly as you age; guilty as charged.

Nonetheless, as we embark on the New Year, many of us think about our New Year’s resolutions. I read that 45% of all New Year’s resolutions are about weight loss and exercise; guilty as charged. Research shows that people who make New Year’s resolutions are ten times more likely to attain their goals than people who don’t make resolutions.

So, as we begin 2013, I would like to challenge you to make a resolution to have an impact on a life, a cause, a ministry — to make a resolution to use your time, talents, and treasures to make a difference.

If you are reading this blog, it is highly likely that you are already making an impact via your role in a nonprofit organization and perhaps at one of them that JGA has been privileged to serve over the years.

If not, you might want to check out Volunteer Match to discover places to share your time and talents. And, as in so many cases, your treasure follows your volunteer engagement.

In 2011, JGA served 55 clients who raised over $238 million in philanthropic support to make an impact.

When I think of my new year’s resolution for 2013, I want to challenge myself to think about how I can make a bigger impact, not just through the clients I serve in my role at JGA but through my personal and family’s engagement in the nonprofit sector.  

As Winston Churchill famously said, “We make a living by what we get. We make a life by what we give.” I hope that I am guilty as charged.

Happy New Year!

by Kris Kindelsperger

The recent results from the 2012 Bank of America Study of High Net Worth Philanthropy, an ongoing partnership with the Center on Philanthropy at Indiana University, reinforced what many organizations have experienced in their campaigns in recent years. 

The study examined a population of high net worth individuals that had a net worth of $1 million or more (excluding the value of their home) and/or an annual household income of $200,000 or more.

It is not surprising that this group is capable of making significant gifts. What is interesting is how much influence they have on philanthropy. Roughly half of all the gifts made by individuals in 2011was given by the wealthiest 3 percent of American households.

All Americans are generous, but high net worth individuals are even more so – 95% of the top 3% supported charitable organizations versus 65% of the general population. More important is the finding that those in the top 1% gave three times more than their counterparts in percentiles 2 and 3.

So, the 80/20 rule is clearly passé. The reality is that a handful of very large gifts may determine the overall success of your campaign.

Want to learn more about how to put these high net worth donors to work for your institution? Join us in Indianapolis next February at the 2013 ALDE Annual International Educational Conference as Cassidy K. Titcomb, Assistant Vice President, Development, Augsburg College, and I discuss “Readying Your Lead Gift Prospects for a Campaign!”

Cassidy and I will share proven techniques for identifying significant prospects within your donor pool, as well as, tools to rate, screen and track major gift prospects leading up to a comprehensive campaign. You will also learn valuable lessons on effectively managing your president, campaign chair, staff or other strategic partners to help build relationships and ensure you secure these high-impact gifts.

Learning techniques to strategically manage those high net worth prospects who have this level of capacity is a crucial step toward ensuring a successful campaign. As the Bank of American Study demonstrates, managed correctly, the time you spend with these individuals will pay dividends.

 by Melanie Norton

In the wake of incessant political campaign advertising, it’s easy to feel like there is a huge divide in America.  

Television commercials, radio programs, phone calls, and overstuffed mailboxes highlight the differences between candidates in an attempt to raise awareness and focus on the areas in which the opponents disagree. 

The barrage of information about the things that differentiate us can seem overwhelming.

According to CNNMoney, The American Red Cross raised nearly $85 million in donations before November 5^th in the aftermath of Superstorm  Sandy.  And approximately $23 million alone was secured during a benefit concert and telethon hosted on NBC, and another $16 million has been added to the total by ABC and Disney’s team event Day of Giving (on November 5^th) for the Sandy relief efforts. 

These efforts, among countless others both big and small, tell us this; Americans are still deeply united in philanthropy.

The 2012 Bank of America Study of High Net Worth Philanthropy, a collaborative study between Bank of America and The Center on Philanthropy at Indiana University, was recently released and reports a remarkable 94.5% of high net worth households gave to charity in 2011. 

Although this figure may be slightly lower than the previous year, the study also shares that this group of donors – defined as those who have incomes of $200,000 or more, and/or a net worth of $1 million or more (excluding home value) – gave nearly 9% of their income and also volunteered more of their time in 2011. 

In a time when there are many needs and many worthy organizations, information about the generosity of Americans is extremely encouraging.

Giving USA 2012 has estimated total giving in 2011 at an astounding $298.42 billion dollars, and the World Giving Index 2011, a survey released by UK-based Charities Aids Foundation in December 2011, ranks the United States as the most charitable nation in the world. 

These studies are statistical confirmation of what we already know in our hearts…Americans can get behind an important cause and unite in making a difference.

Our client organizations strive to make the world a better place through their missions, no matter how different.  Although the needs can be immediate and unforeseen, such as the devastation of Sandy, or more known and consistent like many of the not-for-profits we serve, the generosity of those they touch never ceases to amaze me. 

Our nation is a generous one, even long after the commercials stop and the mails starts to slow, and the power of philanthropy can unite an America in all of its glorious diversity.

by Angela White

Be a part of the Nonprofit Research Collaborative study investigating charitable contributions, fundraising methods, donor retention, and how tactics have changed in these challenging financial times.  Provide information on your organization’s recent performance to gain insights into your own fundraising strategy and benchmark against other nonprofits.

Start the survey now!

Entering your organization’s Employer Identification Number means you skip a few questions, but if you don’t have your EIN, don’t let that stop you. You can look it up or just click on the grey button to start the survey without it.

Hurry though — the survey link will close on September 14th. It takes just 10 minutes to complete. With data going back to 2001, this is the only survey that provides a short-term and long-term perspective on how nonprofit organizations fare and why.

Thank you for your time and participation in the survey.

by Angela White

Today, Giving USA released its estimates for total charitable giving in the United States for 2011. This year, I’ve had the privilege of seeing the process of developing these numbers from the inside as a member of the board of the Giving USA Foundation.  It has been a tremendous learning experience for me and has given me a new appreciation for the financial modeling and attention to detail it takes to track and compile these estimates.

That said, the numbers are in, and while things are better than they have been, the road ahead is still rocky.  

Total Giving
According to Giving USA, charitable giving increased 4 percent in 2011 to $298 billion.  This is the second straight year of growth after giving fell precipitously in 2008 and 2009. It is a testament to fundraisers and donors alike that in times of economic uncertainty, they have still found a way to collectively grow this total over the past two years.

Individual Donors
Individual donors drove this growth. Gifts from living individuals increased by 3.9 percent to $217 billion, and bequest giving grew by 12 percent to over $24 billion.  These numbers aren’t record highs, but it is important to note that individuals are showing a continued commitment to philanthropy as individual giving has always been the dominant source of charitable gifts in America.

Religious Giving
There are significant challenges within these numbers too.  The tide may be rising, but it is doing so very slowly, and it is not raising all ships equally. Giving to religion, the subsector that historically receives the largest share of charitable giving each year, fell for the second straight year in 2011.

Institutional Donors/Foundations
And even though individual donors appear ready to reengage in philanthropy, institutional donors have been slower to loosen their purse strings during this sluggish economic recovery.  Giving by foundations grew only 1.8 percent last year, and corporate giving fell .1 percent.  

Inflation Adjusted Giving
In addition, when we adjust for inflation – which is a better measure of the actual buying power of the dollars raised – total giving was actually almost flat, growing only .8 percent.  At that growth rate, it could take nearly a decade to recover the purchasing power lost since our charitable high water mark in 2007.

What lessons should you draw from these numbers?  At JGA, we believe the primary lesson is that despite nominal growth, improvements in your fundraising bottom-line will still be largely dependent on how well you plan and execute your fundraising strategy. 

Individuals are ready to give, and corporations and foundations are at least holding steady in their gifting, but there is no landslide of new money coming into the system that will wash over all of us.  Thus, strategic  development strategies and a focus on continued relationship building are more important than ever in continuing the philanthropic rebound in our country.

by Ted Grossnickle

Nonprofits looking to engage Millennials, ages 20 – 35, need a strategy to quickly capture these tech-savvy, young professionals in the moment.

This year’s report on Millennials sheds light on how crucial mobile strategies are to organizations. With 77 percent of surveyed Millennials saying they have smartphones, organizations need to ensure they have a solid mobile strategy. It is clear that unless communication from nonprofits changes, Millennials are not going to react favorably to requests for support or involvement.

In its third annual study, JGA and Achieve have expanded their methodology to gain further insight into what works with the next generation of donors and volunteers.  Insights for this year’s survey were gathered from 6,522 responses to a national online survey, 27 participants in Millennial focus groups conducted across the country, and 89 nonprofit professionals’ responses to an online survey.

Download the report for useful advice on developing programs and strategies to enhance Millennial participation in your organization. We’ve included recommendations for action and sample case studies to demonstrate what’s working in the areas of connecting, involving and giving so you can develop a holistic approach to moving Millennials along the engagement continuum.

You can also review additional case studies, blogs and discussions about engaging Millennials at www.themillennialimpact.com.

Angela and Derrick Feldmann of Achieve will host a webinar to review the report findings and important takeaways on Wednesday, June 20^th, from Noon to 1 p.m. EDT.  Be sure to register for this complimentary webinar.

We encourage you to think seriously about the way you’ll engage this group of current and future volunteers and donors.

Key findings

Connecting

• When Millennials want information about nonprofits, 65% turn to the organizations’ web pages, 55% rely on social media, and 47% want updates via e-newsletters.
• When going to a nonprofit’s website, 89% of Millennials go first to the page that describes the mission of the organization.
• When researching organizations, 44% of survey respondents want to know how donations are used, 41% want to learn about volunteer opportunities, and 41% look for event calendars.
• Of the more than 75% of surveyed Millennials who own smartphones, 80% have used those phones to connect with a nonprofit, usually by reading emails or e-newsletters (67%) or getting organization updates (51%).
• In focus groups, Millennials said they view texting and phone calls as personal forms of communication, and therefore do not want texts or calls from nonprofits.

Involving

• When choosing volunteer activities, Millennials will often act quickly. As such, they want opportunities to respond immediately to inspiration.
• 63% of surveyed Millennials volunteered for nonprofits in 2011.
• 81% of survey respondents prefer to learn about volunteer opportunities from friends or family members. 72% want volunteer information via email, and 67% look to an organization’s website for information. 
• By a margin of more than two-to-one, Millennials who volunteer for nonprofits are more likely to make donations, and survey responses and focus groups comments suggest that volunteering correlates to larger gifts.
• 77% of Millennials surveyed are interested in becoming involved in volunteer leadership with a nonprofit, but only 20% are currently on a board or committee.

 Giving

• 75% of surveyed Millennials made a financial gift to a nonprofit organization in 2011.
• 70% of the Millennials participating in the survey said they have raised money on behalf of nonprofits, most often by promoting events or participating in active events.
• 58% of gifts were $100 or less per organization, but the typical Millennial supported five organizations in 2011.
• When asked to choose the phrase that best describes their giving preferences, 42% of respondents chose, “I give to whatever inspires me at the moment.”
• Millennials are willing to help raise money for nonprofits they believe in, and will turn first to family and friends for donations.