Drakes Bay Fundraising
A Next Generation Fundraising Company

Archive for August, 2011

Consumer Confidence Plunges

Posted by Christopher Dann
Tuesday August 30, 2011
Categories: Consumer Confidence Index
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While it was evident consumer confidence would be rattled by the debacle that attended increasing the federal debt ceiling, by monetary crises in Europe, and by the pronouncements of  Presidential candidates, it was not expected to take the plunge it did in August, from an adjusted July 59.2 to 44.5.

This news does not bode well for fall fundraising.

Here is what the Great Recession has looked like from the vantage of consumer confidence. We think it best represents what the Great Recession looks like for the nonprofit sector, at least as far as individual giving is concerned.

This month’s index is the lowest since April ’09 when it was at 40.8.

Reminded that the Consumer Confidence Index foretells what people will be doing with their discretionary income, and that all individual giving but estate giving comes from discretionary income, the August Index tells us it’s time to hedge on estimates of year-end giving. It’s also time to plan for aggressive marketing support of fall campaigns.

Interpreting Giving USA

Posted by Christopher Dann
Friday August 19, 2011
Categories: Fundraising, Giving USA, Statistics
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The annual Giving USA Foundation’s report was later than usual this year, expressing its customary “Let’s give it up for philanthropy!” cheerleading with the perennial expression of awe about just how much money Americans and our institutions give away and a whistling-past-the-graveyard note that 2010’s numbers might presage recovery.

We have been perennially prompted to counter their cheerfulness about overall giving by noting that the expansion of the nonprofit sector has to be weighed against the expansion – or in recent years’ contraction – of giving.  From 2008 to 2010, while overall giving declined 4.2%, the number of nonprofits registered with the IRS expanded 7.9%.  While the IRS this year booted some 275,000 organizations off its rolls for failure to file, reducing the census by some 14%, still the point is new organizations are coming into the charity marketplace faster that the marketplace seems able to accommodate them.

This sobering fact was noted in the report: the 8% decline in giving registered in 2008 was the steepest decline ever recorded in their 56 years of reporting. And the report usefully provides 2008 to 2010 comparable data.

Individual giving (which, remember, accounts for 73% of all giving, not including bequests) dropped 11.6% (inflation-adjusted) in 2008, dropped another 3.3% in 2009, and then rose 1.1% in 2010. The 3-year overall change amounted to minus 2.3%.

Here are the “recession” and “recovery” data for the sub-sectors, inflation-adjusted, along with data reminding us of each sub-sector’s market share:

Sub-sector

Mkt Share

‘08 to ‘10 change

‘09 to ‘10 change

Arts and culture

13%

+2.5%

+4.1%

Human services

9%

+1.0%

–1.5%

Animals & environment

2%

–0.1%

–2.3%

Health

8%

+4.1%

–1.5%

Education

14%

–2.0%

+3.5%

Religion

35%

–2.1%

–0.8%

What use are these data? They are useful in helping organizations assess their situations relative to their sub-sectors and in reminding management and boards that how the giving market behaves has almost nothing to do with how much money an organization needs or wants.

 

Next Generation Fundraising and Drakes Bay Fundraising merged in the fall of 2013, bringing the longstanding professional acquaintances of their four principals – Tim Oleary, Carol Leister, Cindy Germain, and Christopher Dann – into a single company and combining the special resources and experiences of each to provide clients greater breadth and depth of service.

For more information about Next Generation Fundraising, click here.