Fundraising Confidence Slowly Increased Before Year-End 2020

Conducted in late November and early December 2020, the results from the second iteration of AFP’s Fundraising Confidence Survey showed both an increase in year-end fundraiser confidence and concerns about challenges in the year ahead.

The survey asked members a series of 14 questions relating to optimism surrounding their fundraising work, as well as trends and challenges they’re keeping an eye on for 2021.

When asked how optimistic they were about reaching their 2020 fundraising goals (on a scale of 1-10, with 1 being "least optimistic" and 10 being "most optimistic”), fundraisers grew in optimism from September (the first survey) to December (the second survey)—from 6.52 to 6.98. Fundraisers were also increasingly confident about raising more money in 2020 than 2019—from 4.89 to 5.47.

When asked to look back at their fundraising levels over the last three months (September to November) compared to the same period in 2019, 35% reported they raised more, 38% raised less, 21% about the same, and 6% were unsure. These numbers are slightly more positive than the first survey, when 32% raised more and 41% had raised less, with 22% raising about the same and 6% unsure.

Fundraisers were also increasingly optimistic about donor receptivity to their fundraising communications. The confidence level grew from 6.75 in the first survey to 7.38. Long-term confidence was also rising looking toward 2021. When asked very generally about their confidence in finding fundraising success over the next 12 months, fundraisers were generally optimistic: a level of 6.47.

“It’s good to see that confidence is increasing slowly across the board,” said Mike Geiger, MBA, CPA, AFP’s president and CEO. “From our Fundraising Effectiveness Project, we’re seeing giving holding steady or even growing a little for many organizations, so I think this may be a case of fundraisers having low expectations for the end of 2020 and seeing those expectations met or exceeded. Hopefully, that translated into a decent year-end giving season for most organizations; I hope to be pleasantly surprised, but I suspect we’ll see a wide variety of results.”

Future Fundraising Priorities

Among other questions, survey participants were asked to choose the three areas they were going to increase their fundraising efforts over the next three months, six months and 12 months. As with the first iteration of the survey conducted in September 2020, fundraisers continued to focus on donor retention and stewardship, with an average of 60% selecting it as the most important area over all three timeframes.

Top focuses for 2021 also included major gifts, with 55% of respondents selecting major gifts one of their three priorities over the next three months. More than 60% of respondents chose major gifts as a priority at six months, and then 64% after a year. Overall, major gifts rose in importance from the first survey to the second survey—49% selected it as a priority over three months in the first survey, 61% over six months and 62% over a year.

Another focus for fundraisers included online and email solicitations, selected as a priority by 44% of fundraisers over three months, 40% after six months and 37% after a year.

Other top priorities included direct mail (average 36%), foundation giving (average 37%), planned giving (average 30%), corporate giving (average 30%), social media (average 29%) and donor-advised funds (16%).

Telemarketing remains least popular, with just 3% of fundraisers selecting it as a priority over the next three months, 2% over six months and 2% over a year. In-person special events was selected by just 2% of fundraisers over the next three months, but its importance rises significantly as a priority over six months (11%) and then 12 months (28%).

“It’s no surprise that donor retention and stewardship remain priorities for so many organizations, as it’s always more effective and efficient to keep existing donors than find new ones, especially in a challenging situation where in-person, relationship-building opportunities are limited,” said Kevin J. Foyle, CFRE, MBA, chair of AFP. “At the same time, it’s interesting to watch the drop in online solicitations and growth in major gifts and special events. It is clear that fundraisers are expecting a stronger economy and a return to some type of normal as 2021 continues. We’ll have to see how that transition occurs, with a lot potentially riding on how the vaccination rollout continues.”

Thoughts on the Current Fundraising Landscape

Among questions relating to fundraising priorities for 2021, participants were also asked to share their thoughts on the current fundraising environment, the impact of the COVID-19 pandemic and their year-end fundraising:

• With all our major donors tapped out, it will be difficult to sustain this level of fundraising, so we will need to be creative to keep the momentum up, since, like all of us, we will have a slow ramp up to former revenue levels. We hope that stewardship and small virtual events will help, and good social media and communication.
   
• The sky isn't falling: My hope is that donors and institutional funders don't assume that all big plans and campaigns have been thrown out the window because of the pandemic. Organizations that remained stable, nimble, and kept their eye on strategic priorities will move forward with their initiatives. Their ability to adapt should be rewarded.
   
• I think the landscape is a mixed bag depending on where you are located—regional impact is important, as are demographics of your residents. In addition to COVID, we have an economic slump and massive spring flooding that destroyed a lot of infrastructure and impacted many social agencies. The focus for funders was all over the place. A very topsy-turvy year, and I am not sure we learned much to help us through the next year.
   
• We were very fortunate that our virtual events brought in the same or more funds raised than in previous years with little to no overhead costs. We are seriously considering offering hybrid events moving forward.
   
• The current landscape is full of both huge challenges and huge opportunities. Funders are starting to look at impact and engagement in new ways. In the face of pandemic shutdowns, they are even more interested in engaging with nonprofits (they have more time without those commutes!). We are going to have to be willing to throw out the playbook completely and get creative. I think that's going to be a serious challenge for the smaller nonprofits that have very little financial cushion, as well as for the larger nonprofits that have to deal with complex bureaucracies.
   
• As hard as this year has been, I think next year is going to be even more devastating. The City funding that was halved in 2020 could very well be zero in 2021 (since they haven't received the tourism-based tax revenue that normally fills their coffers). More individuals are suffering from the long-term economic devastation of the COVID pandemic. More small businesses are likely to fold. And as the inability to gather in person drags on through 2021, we will have fewer and fewer chances to fulfill our core mission of live theater.
   
• For some organizations this is an opportunity to try new things that will become part of their fundraising toolbox in the future. For my agency, the momentum built for fundraising during the last nine years had been disrupted. It will take us many years to get back to where we were. Old donors are moving, our events don't fully translate to excitement online. The population of people we support are not "sexy.” I see real challenges in our future. On a personal note, I am "spent." We are a small shop. Each year we built on our success and were able to do more. I have spent the last nine months working isolated in my home creating a whole new program that will yield less money. On a positive note, I see some opportunities—hybrid events allow more people to participate and can be cheaper to host.

“I think these quotes, which are very representative of the overall comments from the survey, show that we need to understand that while different confidence measures increased, we have yet to turn the corner,” said Geiger. “Many charities will continue to face very stiff fundraising challenges into 2021 and possibly beyond—we are not out of the pandemic woods by any stretch. In addition, the pandemic has affected charities very differently, with some organizations doing OK and even seeing their fundraising increase. Apart from increased focus on donor steward and cultivation—and I would add innovation—there’s no ‘one size fits all’ solution to our fundraising challenges. That means that charity leaders need to be supporting fundraising staff with resources, tools and even mental and emotional supports so they can reach the goals needed in 2021.”

More than 450 fundraisers from the U.S. and Canada participated in the survey, and the next iteration of AFP’s Fundraising Confidence Survey will be conducted in April 2021.