The growing concerns over the economic slowdown and its impact on various sectors of industry have now seeped into the philanthropic landscape. Many not-for-profit organizations are concerned with the potential impact on their fundraising… with legitimate reason. They especially fear the “R” word — RECESSION — and what that could mean.
The following provides an historical overview of philanthropy during times of recession (based on data from Giving USA/Center on Philanthropy at Indiana University) and suggested strategies to focus on during these difficult economic times.
Over the last 37 years there have been 11 recessionary years. The most significant of those years for charitable giving were from 1973-75, which saw three successive years of declines in giving to charity.
However, historically, giving to religious causes is less impacted during recessionary times than giving to non-profits overall. In fact, from 1973-75, while giving decreased to religious causes in the first of those three years, giving to religious causes actually increased in 1974 and held close to steady in 1975.
In only five out of the eleven recessionary years since 1970 has giving to religious causes decreased.
We believe that a significant part of this strength of giving to religious causes is based on a lifestyle of stewardship rather than just philanthropic motivations. In other words, people of faith are motivated to give for a higher purpose and have made that a part of their lifestyle. Many commit to give each month to charity (their church and other charitable organizations).
Research supports this contention that people of faith are more inclined to give when compared to the secular public. The Independent Sector in its annual Giving USA report has shown repeatedly that people of faith are more likely to give to charities of all types. In fact, they are six times more likely to give than their secular counterparts.
This holds true for countries outside of the U.S. as well. Arthur C. Brooks, professor in the Maxwell School of Citizenship and Public Affairs at Syracuse University, “has found that there is a strong and specific correlation between religious faith and support for charity” (London Free Press, August 4, 2007). This is what he says, according to the London Free Press: "All across Europe, we find that religious citizens are more than twice as likely to volunteer for charities and causes as secularists."
So as we continue in these economically difficult times with the possibility of a recession, we need to remember that our donors are those who are most likely to continue to support our ministries.
With this in mind, allow us to give some perspective and direction
based on our experience.
Over three decades of fundraising, it’s been our experience that the typical Christian donor will not pull back significantly in her/his support. Your core supporters understand the financial challenges you are facing and will continue to support you. There are some key strategic issues you must consider, however, which we will address later.
You will feel the greatest impact with your major donors. Especially if the stock market gets hammered
(as it has in the last few months). Your
major donors will still be committed to your ministry but may be hindered in
fulfilling or making major gifts due to the decrease in the value of their
assets. Remember, major gifts most often
come from appreciated assets, not cash flow. And when assets are depreciating rather than appreciating, it makes it
difficult for major donors to give as much.
First, don’t panic.
You have a loyal donor base that is committed to your ministry. More than ever you need to focus your communication on the impact of your ministry and demonstrate to your donors why their investment is making a difference in the lives of people. It’s vital to stay focused on being transformationally-centric and resist the temptation to become organizationally-centric.
Remember why your donors have given to you in the first place and stay on message.
Second, don’t cut your communications/marketing budget!
One of the greatest mistakes you could make at this point is to try and save money by cutting the very thing that generates revenue to your organization. If anything, you ought to protect and even dedicate more expense to ensure you communicate effectively with your supporters.
Third, be sympathetic with your major donors.
They’re already struggling enough… and will feel badly if they are unable to keep a previous commitment in the timeframe they had hoped. Your major donors need to know you understand their predicament and that you don’t question their loyalty to your ministry. Instead they should feel your support and encouragement.
This may mean you’ll need to adjust your budgets or the timing of projects, but it’ll be worth it in the long run as you will see their support solidified.
Finally, as you do these things, continue to trust God to provide through His people. After all, it’s His ministry doing His work. As long as you’re faithful in communicating and connecting with His people, God will be faithful in supplying your every need.