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On April 2, 2025, President Donald Trump announced a set of tariffs, including a universal 10% tariff on all imported goods, effective April 5, 2025, at 12:01 a.m. EDT, with additional country-specific tariffs.
While there is a lot we don’t know about the impact of these tariffs, what we do know is:
- Imported paper will cost more. Tariffs mean paper coming from other countries will be more expensive.
- Paper supply could be disrupted. Getting paper, especially from places like Canada, might become more difficult.
- Retaliation could worsen things. Other countries might put tariffs on US goods, making trade more complicated.
- There may be other economic implications. Tariffs can increase prices and slow down the economy.
If this leaves you feeling nervous about your fundraising, remember that the economy runs on cycles and things will recover.
While periods of economic instability may cause donors to be cautious with their spending, historical data, specifically from the 2001 and 2008 recessions, illustrates a critical point. Revenue and individual giving can increase beyond pre-downturn levels when the economy stabilizes.
At the end of 2007, the Great Recession hit. 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 many 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.
We’ve seen the same thing with the downturn in 2017 with tax changes, the generosity w/COVID, and the declines post-COVID. But the overall trendline has continued up and to the right. That doesn’t help the strained budget feeling you may have at this moment, but I do think it’s a helpful perspective to remember.
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.
What can you do right now?
Steward the resources you have been given, being careful not to sacrifice the future for the present. And look for the opportunities.
- Give your donors the chance to be heroes! Craft relevant messages and offers — don’t ignore the world we’re living in — remind them they are changing lives. Their support keeps your mission and ministry moving forward.
- Mail smarter by reducing quantity to less profitable donor segments. For Masterworks clients, this is already a part of our work together as we leverage MRI in each select to optimize net revenue.
- Test the reduction of mail to online givers. We’ve seen this save printing expenses while maintaining retention.
- Invest in digital acquisition strategies to help balance your direct mail costs in the long-term.
- Increase targeting efforts to identify donors who are likely to opt into a recurring donor relationship. And ensure you have a sustainer program that is built for 21st-century donor expectations.
- 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)?
- Don’t neglect your major donors — encourage them to visit your programs to see the work being done. 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!
Though today’s economic climate brings its share of challenges, it also invites deeper trust in the One who provides for and sustains your ministry. It’s a moment to collaborate with strategic partners to innovate and strengthen your multichannel strategy. Masterworks is here to help you navigate rising costs — embracing digital transformation and optimizing direct mail — so you can maximize impact without compromise.
