Did the bottom fall through the floor of charitable giving in 2009? Is DM dead and buried? Is online giving alive and kicking?
These are the issues that we've been able to answer through the data and insights (and conversations) shared as part of Pareto Fundraising's latest round of benchmarking, released two weeks ago.
Firstly I'd like to thank the 14 brilliant organizations who were involved in the latest study. You made this happen.
For those interested in the key findings, click here for the full media release.
However, let me give you a teaser:
- 2009 was a 'mixed bag'. Whilst we saw a dip in overall and individual income, we saw increases in some key areas of giving. The fall in individual income was attributable mostly to a fall in direct mail (house and prospect) income. However it should be noted that some of this was a result of less activity, not simply a drop off in results.
- Monthly giving continues to grow, up 9% from 2008 to $48m in annual income, at the height of the global financial crisis. On the current growth trajectory, regular automatic payments look set to topple cash giving as a source of income in 2010.
- Whilst income from planned gifts (bequests) grew last year to around $23m, this is an area of massive potential for Canadian organizations, with the average proportion of cash donors that have indicated they have left a bequest in their Will at around 0.2%. This is far below other countries we've looked at this, where we've seen this range from 1% up as high as 6%.
- Online giving continues to (not surprisingly) grow as a proportion of the 'pie', but it's still a small one, representing around 2% of all income from individuals.
- The average value of a mail recruited monthly donor is worth, on average, five times the value of a mail recruited cash donor, after five years ($800 vs. $135).
Some key takeaways/what this means for Canadian charities:
1 Recruiting low value cash donors is a waste of time*. Monthly giving is where growth is, it's reliable, resilient and recession proof. The caveat is if you are using low value cash donors to feed into a monthly giving conversion program, immediately.
2 It is not too late to jump on the monthly giving bandwagon. Those who have done so within the last two years are already reaping the rewards.
3 Bequests, bequests, bequests. Same point as above, it isn't too late. Strategically, its debatably the single most important area of investment. It is irrelevant that you may not see the fruits of your labor, the point is, your beneficiaries will. Refer here for an earlier post about how to effectively talk about bequests.
4 Direct mail is not growing. Online is. However before you revert your budget from offline to online, remember that mail programs feed into your monthly giving and planned giving efforts. Not to mention fueling prospects for major gifts. Don't lose sight of that. The performance of your traditional streams can't simply be measured on the level of cash they bring you, but also the impact on your other efforts.
5 Remember my post recently about the balance between volume and value. Those who are worth the most are traditionally the hardest to find, and often the most expensive. Think about what you want to achieve.
I'll be touching more on the insights delivered from this exercise over the coming weeks. Stay tuned.