70% of Charities Expecting Drop in Revenue in 2020 and Beyond
New Survey Looks at Fundraising Activities Ahead, Challenges of Working From Home
More than 70% of charities in Canada are expecting to raise less money in 2020 than they did in 2019, and two-thirds believe the same will happen in 2021, according to the Association of Fundraising Professionals’ (AFP) Coronavirus Response Survey.
More than 160 fundraisers participated in the survey, which was distributed to all AFP members in May.
The impact of COVID-19 grew over the first half of the year, with 45% seeing decreases in giving in the first quarter of the year compared to the first quarter of 2019. Just over a quarter (27%) raised about the same amount of funds, while a similar figure (27%) saw increasing in giving in the first quarter.
However, by the second quarter, the impact was far more noticeable, with 72% of respondents expecting to see reduced giving compared to the second quarter of 2019. Just 17% expect to raise the same amount and only 11% predict increased giving.
Fundraising in 2020 and 2021
Similar numbers are expected by respondents for the rest of 2020. Seventy percent of respondents expect to raise fewer funds in 2020 compared to 2019, while only 11% predict they will raise more funds, and 19% believe fundraising totals will remain about the same.
Most fundraisers expect to see a continued negative impact into 2021, with over two-thirds (68%) believing that giving next year will continue to be lower than in a typical year. Just 19% believe giving will be about the same as for a typical year, while 13% think giving will be higher in 2021.
“We expected to see a significant drop in giving because of COVID-19, and our data shows that it will be a difficult time for fundraising for 2020 and well into 2021,” said Mike Geiger, MBA, CPA, president and CEO of AFP. “However, it’s too early to say exactly what will happen by the end of the year, and charities are still adjusting. There is one general rule that is the most important for charities to follow during difficult and challenging times. Organizations cannot afford to stop fundraising, and those charities that continue to raise funds—and even increase their fundraising—will do the best. We have to raise funds with sensitivity, but we must continue to raise funds to support our critically needed missions.”
Specific Types of Fundraising
Over one-third of charities (38%) report increasing their fundraising activity now because of COVID-19, while 39% will keep their fundraising at normal levels throughout the year. Just 22% of organizations plan to decrease their fundraising.
The most popular areas where charities are expanding their fundraising include donor stewardship—connecting donors to the cause and inspiring them to get more involved (88%)—social media (83%), creating virtual events (81%) and online fundraising (79%).
Government grants have also been a key source of revenue for some charities, with the Canada Emergency Wage Subsidy being by far the most popular program. Forty-four percent of respondents applied to the subsidy program, and 23 percent received funding. Other programs were less popular. For the Canada Emergency Business Account/Loan, the Emergency Community Support Fund, and Canada Emergency Response Benefit Fund, roughly 15% of respondents applied to each of those programs, with only approximately 6% receiving any funding.
The cancellation of in-person fundraising events has been a huge challenge for most charities, with 92% of respondents indicating they would reduce the number of such events during 2020. More than two in ten organizations (23%) have already postponed five or more special events, and 14% have canceled five or more events.
One respondent noted: “Our annual fundraiser, volunteer appreciation event/celebration and donor stewardship calls have been moved online so far; we may need to also move our annual donor stewardship event online but are unsure at this point. We're exploring virtual donor tours and group programming for clients as well.” Another said that “We just held our capital campaign celebration as a virtual event; it worked well and stakeholders from all over the world participated. We will hold virtual reunions for stakeholders and have moved in person donor stewardship events to be a week-long communications strategy.”
Working From Home and Staff Impacts
More than nine in ten respondents (93%) indicated they are working from home now, with 41 percent saying their organization was “well prepared” for this shift and 36 percent believing they were “somewhat prepared.”
“Figuring out the best way to craft our asks for urgency, as we are not front-line essential workers but still support a vulnerable population, has been challenging,” said one respondent. “Navigating this new landscape given the sudden information overload and trying to get a sense of how donors are feeling about giving has also been tricky.
Another respondent noted: “The need to give out my personal phone number to donors and also working out of two places at home as well as in rotating shifts at the office, have all been problematic and challenging.” Several respondents expressed frustration at working from home while trying to homeschool children and working in different spaces all the time.
The impact of COVID-19 has extended well beyond fundraising and has affected staffing levels and activity. Over 30 percent of organizations (31%) have been forced to lay off staff, and 1% of respondents have been personally laid off. In addition, 16% of organizations have cut staff pay.
Respondents have advice for other fundraisers and charities as they looked to the future, including:
- Keep pushing the data and articles to leadership and board to prove that now is a good time to fundraise. If we wait until Christmas, that may no longer be as good a time. Don't be afraid to fundraise from your volunteers. Digital fundraising campaigns should be extended to all parties unless they are specifically targeted to certain groups of donors.
- We have an incredible opportunity to connect. Take a deep breath and try to focus on the parts you can control: reaching out to donors and checking in with them, not the demands or pressures of your KPI or your managers' budgets and goals. Do the stuff that fills you up and track your calls and activity. It adds up and will bear fruit.
- It is likely that the need has not changed for your cause. While there are many individuals and organizations who may be suffering income loss, sometimes devastating, there are more people and organizations doing the same or better than they were pre-pandemic. Our role is to provide people with the opportunity to make a difference through financial support. Now, of all times, it is critical that we give people the chance to help.
- Steward, steward, steward. We are running a marathon, not a sprint. Giving will slump but if you care for and about your donors, the rebound will make up for slump. And be compassionate. Ask how your supporters are doing and deepen relationships. Be bold and go do work—those that can give, will. Keep asking for support.
“The work of fundraisers and fundraising is more important than ever,” said Paula Attfield, chair of AFP Canada. “The charities that are able to invest in fundraising today will raise more money tomorrow. Beyond investment, fundraisers are going to require innovative and creative ways of connecting donors to their causes. As a profession, we’ve already proven we are innovative by adapting to working from home, despite the multiple challenges in doing so.”
Attfield continued: “And of course, as AFP members, we understand the continued importance of best fundraising practice: asking for the right amount, at the right time, with the right message, combined, of course, with great stewardship. As fundraisers, we know there is no giving without asking, and if we stop asking, well, quite simply, our revenues will fall.”
For more information about the AFP Coronavirus Response Survey, please contact Michael Nilsen at firstname.lastname@example.org.