A study, by Convio, Edge Research, and Sea Change Strategies, shed considerable light on the way various generations of donors actually engage in charitable giving.
The study pointed out that while the majority of fundraising is targeted to, and meant to attract, mature donors (those born before 1945), that segment is rapidly shrinking. So how should fundraisers reach the next wave of donors while continuing to derive the most possible in gifts from older donors?
The fact is that the older generation still gives the largest gifts, even as their generation decreases in numbers, while younger donors, from Baby Boomers (born 1946-1964) to Generations X (1965-1980) and Y (1981-1991), must be encouraged to fill the ranks. The problem is that the same methods that appeal to older donors don't always work with younger donors.
The study delved into this problem in depth, revealing the giving behavior of the various generations and providing clues as to how to proceed.
Total Gifts and Number of Charities
Matures give, on average, $1066 per year to 6.3 charities, while Boomers give $901 per year to 5.2 charities. Gen X gives $796 on average to 4.2 charities, and Gen Y gives $341 to 3.6 charities.
The average gift to an individual's top charity ranges from a high of $280 from Matures to $161 by Gen Y. The differences in total gifts among the generations is due primarily to the number of charities given to (increases with age), rather than big differences in average gifts.
Furthermore, when the estimated population of each generation is considered, Matures represent just 21% of total donors and 28% of actual contributions. It pays for any charity to appeal to as many kinds of donors as possible.
What Appeals to Which Generation?
The study considers several methods of donating:
- Giving by checkout (what we do when buying groceries, for instance) is common across the generations.
- Giving by mailing a check is the most common method for Matures. Give by mail is also still prevalent with Boomers and Gen X, although at a lower rate.
- Giving on a website increases with the younger group so that for Gen X it is nearly equal to mail, and for Gen Y it is greater than mail.
- Giving by mobile/text and social networks are emerging channels for Gen X and Y.
As we can see, mail is predominant for Matures, but for all the other generations, there are multiple channels, with websites and email ranked as most important; and Facebook and other social media registering as lower but significant for Gen X and Y. The study also found that peer solicitation is strong across the generations, especially when donors have a pre-existing relationship with the charity.
How Do Donors Initially Engage with a Charity?
Surprisingly, traditional media is the primary way all generations learn about a particular cause, with the exception of Matures. Matures rank mail as the primary way they learn about a charity. Interestingly, mail ranks in the first three choices by Boomers (19%) and Gen X (16%), but it doesn't even show up for Gen Y.
Most donors, across generations, engage with a charity through a direct donation, but many attend events, visit the charity's website, or volunteer first. The younger the donor, the more ways of engaging turn up. In addition, Gen Y and X donors are more likely to show their support of a cause in ways other than a direct donation. They consider giving money just a small piece of supporting a cause, which includes spreading the word, fundraising for the cause, and volunteering.
The survey asked donors how well various attitudes and ideas about philanthropy describe them. The researchers sum up the results this way:
"Younger donors described themselves as much more random and peer motivated in their giving, in contrast to older donors who described themselves as more premeditated. Specifically, younger donors are more likely to support a charity when friends/ family ask versus the charity asking them. They consider much of their giving relatively random based upon their emotional reaction to something in the media, or based upon who asks.
"Older donors have a well established commitment to their primary charities. They have a budget set aside for charitable giving, and know the organizations they plan to give to. This suggests that it is harder for a new charity to break in with older donors, but once you secure them, they are quite committed. Younger donors represent relatively open targets. The best way to reach them is either through inspirational stories in the media or better still, via their friends."
Suggestions from the Study
- Reconsider if your charity is heavily dependent on direct mail as a way to acquire new donors.
- Remember that while direct mail may motivate a donation, givers are quite likely to actually donate via your website.
- Donors acquired by one channel (for instance, the Internet) may want to continue giving by way of another channel (such as direct mail).
- Websites are crucial even when a donor sends a check. Most donors now research on the Internet.
- Donors use multiple channels, responding to a friend's post in social media, but then writing a check or donating online, for instance. The study even found that 50% of Matures report using Facebook.
- Younger donors "channel hop," depending on how they feel at the moment and where they are.
- Make sure you have a database that can track as many types of interaction with donors as possible.
- Avoid organizational silos. Your direct mail people and your online fundraising people should cooperate.
- Don't write off direct mail. However, the content and style will likely change.
- Word of mouth is important. We are deluged with information and often turn to the advice of friends and colleagues. Friend-to-friend communication must be a part of any fundraiser's strategy.
- Any strategy is only as good as the quality of your message and ability to motivate and inspire donors. Go for the heart first, then the head.
The Convio study, The Next Generation of American Giving, is a very important piece of research. You can easily download it and enjoy the great stats and charts.