Marketing and donor commitment in a recession

The world has seemingly changed overnight and millions of us are being asked to shelter in place, practice social distancing, and forego meeting with our friends, family, and church communities. The immediate future is uncertain, and those forecasting for the months ahead are throwing around one of the scariest words in fundraising: Recession.

Recessions, where marketing budgets are often cut and development teams are expected to grow revenue with few resources to actually invest in that growth.

We’ve been here before. And, we’ve survived. Some have even thrived. For many, revenue and  individual giving actually increased during recent recessions. How? Staying the course. Continuing to execute strategic plans, not cutting back on vital fundraising initiatives.

But does the data support this? Yes!

In the 2001 recession, over half of Masterworks’ clients saw an increase in donor revenue. And for those who saw growth, they felt it through increased active donors, average gifts, and gift counts.  Their donor base grew and their revenue followed.

2001 was a shorter recession, lasting just 8 months, and revenue continued to improve into 2002. Then, at the end of 2007, the Great Recession hit and lasted well into 2009. And, here again, we saw a similar trend. 69% of our clients saw an increase in donor revenue:

As the recession continued into 2009, we saw an interesting shift in donor behavior: There was a 5% decline in revenue BUT a 6% increase in the number of active donors and a 4% increase in the number of gifts. Donors remained committed to their causes and continued to give faithfully, but for many, they simply had less to give as the recession impacted them. It’s not that donors didn’t give, but that they had to reduce the amount they gave, at least temporarily.

And that’s the key. Temporarily.  When the recession was over, giving, on average, increased 3% from 2009 levels, which returned most organizations to pre-recession giving levels and set them up for growth. In the end, when looking at all these organizations from 2007 to 2010, giving was flat, even with a recession. 

Ok, so how do we keep a recession from hurting revenue growth? Why did some organizations grow, while others faltered?

We know that recessions can impact giving, but the data shows it doesn’t have to mean huge shortfalls — or declines in your donor file. Continuing to get in front of your donors with relevant messages, strong offers, and clear calls to action can make all the difference.

During times of crisis, give your donors the chance to be heroes! Craft relevant messages and offers — don’t ignore the world we’re living in — to remind them they are changing lives. Their support keeps your mission and ministry moving forward.

Donors don’t stop caring about your cause because of the economy, but they also don’t magically remember to give if you stop asking. The adage applies to fundraising during recessions too…if you don’t ask, the answer’s no. (And if you’re not asking, someone else probably is.)

First, stay the course. The economy will improve. And your organization will be primed for growth. This is not the time to shrink back. Doing so will surely result in both short-term losses, and long-term impacts as you reap the consequences of those cuts over the next several years.

Second, look for the opportunities. Any downturn contains opportunities, if you have the eyes to see. For example, sustainer programs are more important than ever before, in the Subscription Economy. Do you have a sustainer program that is built for the 21st-century donor expectations?

Don’t neglect your major donors — encourage them to visit your programs to see the work being done (or in the case of social distancing, take them on a virtual tour, send short videos, FaceTime…). Ask if they’ll allow you to leverage their gift as a match — your general donors love a good matching grant to double their gift!

Shore up your website. Are your donation pages optimized for conversion? Is monthly giving a highlight? Can donors easily give via a donor advised fund (DAF)?

Recessions create uncertainty, but they don’t have to be scary. You know what to do. Stay the course. Get in front of your donors. Remind them of the life-changing work they support. And continue to invest in strategies to grow your ministry.