Recession-Proofing Is Just the Beginning: Building a Savvy Strategy for the Future
Rolling with the punches has become a hallmark of fundraising over the last few years; riding the waves of pandemic, social unrest, global upheaval, and the subsequent economic fluctuations. As we move into 2023, recession will continue to be yet another defining moment for organizations of all sizes. So how about some good news: the steps you can take today to get ahead of recession are the same steps that will shore up your organization against any number of challenges. By taking a long-view at how philanthropy has remained stable through a number of major recessions over the last several decades, we can map a pathway to stability. Nothing we have faced so far is new, even if the world seems forever changed. The adage–that you’re probably sick of hearing by now–is true: there is no greater constant than change.
There have been 11 economic recessions in the US since 1948, each making its own impact on the philanthropic sector. In the recent report from the Blackbaud Institute, Philanthropy Through Recession: How Savvy Organizations Weather Uncertain Times, the data shows that the sector has remained relatively strong throughout. How each organization rebounds, however, is impacted by several factors. The hope is that you can not only survive recession but emerge stronger and more strategic on the other side. At this year’s virtual bbcon, Ashley Thompson (Managing Director, Blackbaud Institute) and Lawrence Henze (Analytics Architect, Senior Principal, at Blackbaud) expanded on the data and insights from this report to offer a roadmap to build a strategy for resiliency. Here are just a few of their tips:
No matter the climate, maximizing revenue is critical to establishing a stable base for your organization. A diversified revenue stream relies on retaining your existing donors while looking for opportunities to expand.
- During uncertain times, alternative sources of giving typically rise. DAFs; gifts of real estate, stocks, or businesses; and planned giving offer your supporters means to make a dramatic impact even when the market fluctuates. When reaching out to multi-year donors and new prospects, leave the doors open to means of giving that you may not yet be utilizing.
- In the same vein, you may have a long-standing relationship with a foundation but shouldn’t neglect the role of earned revenue or sponsorships.
Retention should be your key focus no matter what challenges your organization is facing. It can’t be overstated that multi-year donors make or break your revenue goals. Retaining your existing donors and fostering valuable relationships with prospects comes down to a strategic engagement plan. Your communications shouldn’t be “one-size-fits-all.” When the economy dips, your first instinct is likely to tighten the purse strings. It’s tempting to eliminate direct mail in favor of a more budget-friendly, digital-first approach. However, outreach can–and should–take many forms to speak to all segments of your audience.
- Invest in IRL communications like postcards to all your constituents while leveling up your digital game with videos and consistent messaging.
- Don’t be afraid to ask your audience how they want to be contacted and what they’re most passionate about in your mission. This can be done by sending out surveys and taking advantage of the data that you already have available.
Whether you’re a small, DIY nonprofit or a large, established institution, the best path forward in retaining your supporters and growing your base is to listen and respond in turn.
Internally, there is no better time to take a critical look at your organizational structure. Breaking down silos not only decreases your operating costs, but it also creates opportunities for innovation, collaboration, and advancement. “As your constituents engage with a cause that they care about–and hopefully your brand–they aren’t thinking about their involvement with your organization as coming in from one specific team of department. They are engaging or finding you in a multitude of different ways,” Ashley Thompson points out. “An organization is really just one channel in which they realize their own goals for impact.” Your constituents’ experience with your organization isn’t linear; your leadership can’t be either. By shifting your mindset to “Work as One” you will be better positioned to listen to your supporters and respond to challenges and opportunities as they arise
These are just a few takeaways to consider. To learn more about how to bring together and apply these principles to your organization, we encourage you to check out the full presentation. This conversation, along with dozens of sessions from bbcon 2022, is now available for free, on-demand.