Since 2010, fundraising trends have changed rapidly. Many changes have taken place due to the rise of technology and the growing impact of the internet. Other changes are directly related to cultural and societal shifts.
The non-profit/donation industry is constantly evolving. Major non-profits are streaming live from their offices and adding GIFs to their Instagram stories, landlines are gone, donors give with their phones via Android Pay while riding the train to work, and organizations are being asked for proof of their impact through Facebook Messenger. And the speed at which this is happening is astonishing.
It seems that not all non-profits are ready for these rapid and unpredictable changes. In 2021 it is important that you have a clear fundraising plan and are aware of the possibilities. By thinking ahead and staying on top of the surrounding trends, your non-profit will be ready for 2021.
The 8 Key Fundraising Trends of 2021 Impacting Nonprofits:
Table of Contents
Fundraising Trends #1: Watch the Generation Z
The world has been talking about millennials for years. While non-profits should continue to hear about Millennials, now is the time to start exploring Generation Z as they are the bulk of current donors.
It concerns people born after 1996, they make up an estimated 27 percent of the population.
They are also sometimes referred to as ‘’iGen’’, a term that refers to the digitally proficient group of this generation. Gen Z accounts for a quarter of the population and will account for 40% of all consumers by 2020. Understanding this group will be critical to succeeding in 2021 and the decade ahead.
The 2017 Global Trends in Giving Report reported that Gen Z members are interested in giving to many charities. The top-scoring categories include youth, animals, and humanitarian aid. Gen Z members are committed to a good cause and willing to help as volunteers.
Despite the majority of Gen Z not yet entering the labour market, they are highly motivated to do ‘good’ and give back. Be authentic. However, Gen Z’s digitally proficient group can quickly determine whether an organization is genuine.
What can you do?
- Be short and sweet: This generation is growing up with access to an incredibly large amount of information, much of it irrelevant to their lives. To survive, they learn how to quickly filter and sort information. They are also adept at blocking marketing noises. To gain their attention, give them an engaging and direct experience with short and powerful messages.
- Mobile Mobile Mobile: Gen Z is the first generation to be mobile-only. Gen Z members spend a lot of time on their phones and prefer to conduct all online activities that way. Your website and donation page must both be optimized for mobile. Being mobile-friendly is one of the main aspects of fundraising trends 2021.
- Visuals are important: Gen Z spends a lot of time on visual-based platforms like Instagram and Facebook. When trying to interact with Gen Z, it’s important to emulate these platforms and create and use authentic visuals. In addition to photos and videos, infographics are also a great tool for communicating data visually and understandably. Use visuals to tell compelling stories.
Fundraising Trends #2: From Generalization to Hyper-Personalization
More and more donors expect a hyper-personalized and tailor-made approach. Tech giants like Netflix and Amazon use cutting-edge new technologies to make recommendations while browsing their sites. Netflix even shared how they not only use individualized viewing history but also use movie static images to display different cover images to different users to appeal to the widest range of tastes.
It seems that as a society we also expect this level of sophistication in our interactions with the rest of the world. In 2021, this expectation will increasingly also apply to charities.
It is no longer enough to use one generic marketing strategy for a diverse group of donors.
According to the 2017 Trends In Personalization, 96% of respondents think personalization helps build customer relationships, while only 45% agreed that marketers use personalization well. It is more important than ever to appeal to different demographics in society.
What can you do?
- Make the “question” personal. Don’t propose a $50 donation to a potential donor who can donate millions. Do your research before asking a question, especially if you’re approaching potential donors individually.
- Pay attention to the donation page. Get to know your audience before sending personal messages. Choose projects and formulations that you already know will best suit the donor base.
- Personalize your messaging: When communicating with various donors, online fundraising or offline, specialize your messaging. Consider generational differences and other demographics.
Fundraising Trends #3: Email Isn’t Dead
Email is not dead, quite the contrary.
In 2017, there were 3.7 billion email users worldwide. This number will grow to 4.1 billion users by 2021.An email has an average ROI (Return On Investment) of 122% that is more than 4x higher than other marketing methods, including social media, direct mail, and search advertising.
A study found that email accounts for 26% of online revenue and the number is expected to increase in the near future. While only 6% of donors were willing to donate via email in 2012, that number rose to 28% in 2018.
Obviously, the way emails look has changed over the years. For example, emails today are much more visual than before. It has also been shown that while more and more people are using social media and spending more hours on their devices, the opposite trend has also occurred in recent years. There has been a backlash against social media that has quietly been among the young.
A 2017 survey of British schoolchildren found that 63% would be happy if social media had never been invented. Young people cite reasons such as wasted time, “false” presentation of life, stress, and pressure to be perfect, desire to make meaningful, real-life connections—as reasons they limit their use of social media.
Another reason email isn’t dead: Emails aren’t as disruptive as social media and are easier to check. Email is the way to reach those young people who are taking a break from social media. Plus, emails are cost-effective and easy to create.
What can you do?
- Make sure your email marketing strategy is top-notch. Segment your audience based on demographics, preferred communication frequency, etc. Get clear insight into what you’re trying to achieve through your emails (e.g., increasing the number of monthly donors).
- Pay attention to the emails. The emails should contain a clear call to action, with an inviting subject line, and be sent at the right time. While high-quality images are essential, don’t overload the email with visuals. Simplicity works. Thoroughly analyse the data, such as the percentage of open emails, CTR (Click-Through Rate), and unsubscribes.
- Apply ‘’Story Theorem’’. Stories are one of the most powerful tools at your disposal. They convince people to donate and let them participate like no other method does. Use the emails to share stories about impact.
Fundraising Trend #4: The Growth of Business Donations
Corporate sponsorship is a payment made by a company to a non-profit to promote the non-profit’s operations, programs, or events.
In recent years, companies and their philanthropic departments have begun to invest more in initiatives that are socially and environmentally responsible. This was largely driven by the rise of the conscious consumer, as well as conscious workers.
Research has confirmed time and again that there is a positive relationship between how employees perceive their company’s social contributions to the community and employee engagement in their work.
A 2016 study by Cone Communications found that 58% of the population consider a company’s social and environmental obligations when deciding where to work. When you partner with a company, your non-profit will not only receive a donation but also reach a new audience. This new group could lead to new donors and volunteers.
What can you do?
- Offer donation matching programs: Companies often offer donation matching programs to their employees. When an employee makes a donation, they ask their employer to make a donation to the same non-profit as well. The employer’s gift is the “matching donation”.
- Corporate Sponsorship and Partnerships: Before partnering with a for-profit organization, think about your target audience and how they will receive the news about the partnership. Do your research and make sure the company’s values match those of your organization. Prepare a sponsor proposal and start approaching potential sponsors!
- Offer volunteer work: Monetary donations aren’t the only way to give. More and more companies are allowing and encouraging their employees to set aside time inside and outside of work to volunteer.
Fundraising Trend #5: Donating monthly pays off
When a donor sets up a recurring donation, they choose to give a predetermined amount on a regular basis. Many people like to give monthly (the most common), quarterly, or annually.
Donating regularly can have a hugely positive effect on the long-term financial sustainability of your non-profit. It provides a steady stream of revenue, leaving more room for your non-profit to focus on growth and innovation. Therefore, regular donors are more involved, give more, and remain committed to your organization for a long time.
However, most non-profits still struggle with finding recurring donors or converting one-time donors to recurring donors.
In addition, it is becoming increasingly important to offer your donors as many different payment options as possible. This is one of the advantages of an online donation system.
What can you do?
- Use an online donation system like Whydonate. Whydonate is a powerful and efficient donation management system explicitly optimized for recurring donations. It makes building your donation pages effortless and offers a number of other features and benefits.
- Promote your donor program for recurring donations. For example, link to your recurring donation program in your email newsletters, social media posts and place a prominent link to your recurring donation program on your website.
- Communicate with your donors via email and social media. Consider surprising your one-time donors with small gifts. Design powerful social media campaigns that demonstrate the value of recurring donations by demonstrating the impact they have.
Fundraising Trend #6: It’s all about communities
In the non-profit world, much attention has been paid to community-led and community-driven development. These developments include a community working together towards a shared vision to learn from local actions to achieve social change.
Likewise, there has been a lot of focus on community-driven fundraising. Many non-profit organizations have already researched peer-to-peer fundraising.
While crowdfunding (another popular fundraising strategy) uses a single landing page to collect donations from a large number of people, peer-to-peer fundraising invites donors and supporters to fundraise on your behalf. With peer-to-peer fundraising, fundraisers often have their own donation pages. Peer-to-peer fundraising has another powerful benefit, which is social proof.
Social proof is a powerful psychological and social phenomenon in which people adopt the actions of others in an attempt to display correct behaviour in a given situation. Essentially, this means that people do what they see others doing.
There is much more need for real human contact instead of marketing noise. This desire for human contact paves the way for a new way of fundraising.
What can you do?
- Start peer-to-peer fundraising: Mobilize your donors and donors in a peer-to-peer fundraising campaign by clearly explaining its benefits and providing plenty of support and encouragement. Make fundraising materials available and easily accessible to your fundraisers.
- Offer something extra: Offer tours of your offices or project locations. Organize events where your donors and beneficiaries meet.
- Build a community: Create a strong brand that others want to be a part of. Offer leadership positions or other rewards to the most active volunteers and donors. Encourage your donors and supporters to take an active role in achieving the organization’s mission and vision.
Fundraising Trend #7: Artificial Intelligence is on the Rise
In Accenture’s 2018 Technology Vision, four out of five executives (81 per cent) said they believe AI will work alongside humans in their organization within the next two years, as an employee or a consultant.
AI (Artificial Intelligence) broadly refers to programs, computers, and machines that perform “intelligent” tasks. These include planning, learning, reasoning, problem-solving, knowledge representation, perception, movement and manipulation, and, to a lesser extent, social intelligence and creativity.
One of the simplest uses of AI is chatbots. Chatbots are services that sometimes use artificial intelligence, which you interact with through a chat interface. They use messaging services such as Messenger, Slack, Telegram, and other chat services.
Jewellery brand Lokai and non-profit organization Charity Water used a chatbot Yeshi to raise awareness about the water crisis in Ethiopia. The chatbot tells a story but also accepts donations. Chatbots can deliver personalized messages to potential donors 24/7.
There is a lot of potential in a human-machine collaboration that caters to the fundraising trends of 2021.
Artificial intelligence can help non-profits collect more data and use it better to achieve their missions and solve societal problems. For example, a non-profit that helps young people who want to harm themselves could use AI to tag content on social media to see which young people may be at risk. To that end, the Crisis Text Line service has learned that the term “ibuprofen” is 16 times more likely to predict the need for emergency aid than the word “suicide.”
AI can also be used to dramatically improve your programs and services. For example, CollegeForward uses machine learning to identify coaching methods to prepare high school students for college.
While AI is still in its infancy, many non-profits are already witnessing its powerful implications when it comes to their impact. Now is the time to explore AI.
What can you do?
- Consider creating a chatbot. Facebook message apps are growing fast. For example, Facebook Messenger is used by more than 1 billion people every month and is growing faster than Facebook itself. This presents a great opportunity for your non-profit organization. Your chatbot can handle donations, member registration and provide information about the projects.
- Personalize communication with (potential) donors. AI can power customer journeys by personalizing them with tailored, personalized messages based on real-time events. These personalized messages shown to donors at very specific times can have a much bigger impact.
- Use AI to become a data expert. Smart use of data can make the most of what is possible. For example, AI can help you analyse data to predict the likelihood that a potential donor will be able to give a large gift. It can look at the history of giving and signing up, event attendance, relationships, and even data from wealth screening tools.
Fundraising Trend #8: Transparency about impact is important
Donors want to know how their money is being spent. There is, therefore, a lot of momentum around the transparency of the impact of the donation.
Checking this impact by donors will become a significant fundraising trend in 2021. It will determine whether people contribute to a cause. Donors, especially millennials, want more personal involvement in the causes they support. Today, many donors have a wealth of skills and resources to research a non-profit’s governance policies and social impact. And they are not too lazy to do that.
To meet this need and respond to this trend, you can put an “Impact” page on your website that clearly shows the social impact. Of course, to do that, you need to measure your impact first. If your non-profit isn’t already measuring impact, that should be the first step.
Many non-profit organizations already produce impact reports or include the impact report in their annual report. There are also other creative ways to be transparent to your donors and supporters. For example, ‘Charity: Water’, they mapped each of their completed projects on Google Maps with GPS coordinates, photos, and information about the community being served. That way, their supporters can see exactly where they work and how many people have received clean water.
What can you do?
- Invite your donors to visit your project location and show them instantly how their donation changed the lives of the beneficiaries.
- Discover live-streaming. Live-streaming is one of the most direct and authentic tactics you can use to increase your organization’s transparency. Raw footage is often the most powerful, so prepare for the unexpected by always having your cell phone handy.
- Use infographics. Infographics help you talk about complex ideas with your audience. They are an efficient way to show how your organization uses donations. Infographics can also help attract a wider audience as they can be easily shared and liked by followers.
For non-profits, it is essential to step back and understand how these fundraising trends will fulfil their organization’s goals for 2021.
Forward-thinking organizations remain aware of the world around them and are constantly learning. Learning and awareness are essential to how non-profits can deliver services and accomplish their missions.
Organizations that don’t fail and this is the harsh truth. Only those non-profits and organizations that are constantly learning and adapting can survive and thrive.
We hope our article helped you learn about the biggest and most important fundraising trends in 2021. We also hope you can take these insights further and apply them to your daily activities.
We’ve only covered the tip of the iceberg here, so we encourage you to do your own research.