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Nonprofit Fundraising in 2021, What Happened and What’s Going to Happen

Like their for-profit business counterparts, nonprofits had quite a chaotic year in 2020. Not only were their already limited resources stretched by an overwhelming need—and demand—for their services, but nonprofit fundraising took a big hit as consumers andnonprofit fundraising businesses pivoted to survival mode and considerably cut back on charitable giving.

The National Council of Nonprofits points to three main causes of nonprofit financial loss last year:

  1. Earned income plunged for many nonprofits as they had to close their centers due to COVID-19 pandemic restrictions and policies.
  2. Expected income from government contracts didn’t materialize since many projects were canceled or postponed—again because of the pandemic.
  3. Nonprofit fundraising suffered significantly due to postponed or canceled fundraiser Plus, so many Americans lost their jobs. Other consumers, anxious about the economy, held on tighter to their disposable income, tapped the money they typically set aside for charitable donations for other uses or funneled their contributions to specific pandemic-related nonprofit fundraising efforts.

Still, fundraising boards are now optimistic about raising money this year, and in 2022 as consumers and businesses return to their normal, pre-pandemic activities, the economy continues to improve, and people start contributing to charitable causes once again. Of course, part of nonprofit boards’ fundraising responsibilities is to provide leadership and pursue donor opportunities. But board members also need to stay up-to-date on the latest trends in nonprofit fundraising best practices in order to be effective at fundraising for their nonprofit organizations.

Here are this year’s latest trends and fundraising ideas for nonprofit organizations.

Nonprofit Online Fundraising

As consumers hunkered down at home, previous hesitancy about shopping online flew out the window, and savvy business owners took advantage of this new attitude and change in shopping behavior. It was a new world for many.

This behavior pattern spilled over to the world of nonprofit fundraising, where, despite the pandemic, online giving grew 21% during 2020, according to a recent report from the Blackbaud Institute. In fact, Blackbaud found online donations are what brought charitable funding out of its early-2020 slump. Organizations received 13% of their nonprofit fundraising from online donations last year, which is the highest amount ever measured. Blackbaud sees this trend as a substantial, positive step for nonprofits as digital fundraising grows to become an integral part of contemporary nonprofit fundraising plans.

Email Marketing For Fundraising

An effective way to keep your nonprofit organization at the forefront of donors’ minds is through email marketing. According to Campaign Monitor, email marketing is one of the best ways to connect with donors to show them the impact that their contributions make and to thank your supporters for their dedication and generosity. Email is also a great way to retain donors by keeping them in the loop about your organization’s activities. As with all email marketing campaigns, personalization is key to communicating the right messages to the right people, so keep that in mind as you segment and schedule your campaigns. And, of course, every one of your emails should include a call to action (CTA) for nonprofit fundraising.

Social Media Fundraising Becoming More Mainstream

With so much of the world getting their information online, it’s no wonder successful nonprofit fundraising campaigns get such positive results from social media marketing outreach. A 2021 report from Pew Research shows about 72% of Americans use social media. Through consistent social media posting, nonprofits can build awareness, educate the public about their causes, advocate for their organizations, stay in touch with current donors, and attract new ones.

Social media outreach is also an effective way to reach people in need of services, build strong community bonds, and encourage others to take action. Through social media channels, organizations can send frequent updates to help them reach their nonprofit fundraising goals and provide links, driving traffic to their donation websites. Most social platforms, such as Facebook, Instagram, YouTube, TikTok, and Pinterest, offer users specific tools for nonprofit fundraising, and many allow you to collect donations within their platforms.

The Fundraising Play for Auto Pay

The ability to automatically donate to nonprofits has been around for years. But, the need for physical distancing last year and the 2020 surge in overall online activity has increased its popularity. For corporate giving, recurring donations make charitable giving lessfundraising plan complicated. For consumers, a recurring donation usually offers a lower (and more affordable) monthly financial commitment. In a recent report from Nonprofit Tech for Good, 51% of the 13,000 donors surveyed said they participate in at least one recurring donation program. When looking at respondents from Canada and the United States alone, the 2020 Global Trends in Giving Report showed 57% of the respondents were enrolled in a recurring giving program, up from 46% in 2018.

Nonprofit Fundraising During a Crisis

While nonprofits are already struggling to navigate the new normal of remote working and an economy in recovery, they also face the challenge of newly-established pandemic-related charities competing for donations. So it’s imperative to distinguish your nonprofit from the others. According to Charities.org, the best way to stand out from the crowd is to be transparent, show the value of donating, and how your organization is making an impact.

During an economic crisis, people naturally scrutinize where they spend their money more carefully, and that includes deciding which nonprofits deserve their donations. Organizations must show the public where the money goes. Be sure to tell the stories of the people you’ve assisted and how donations help make a difference—the more personal the story, the better.

Reach out and join with other nonprofits to promote events and create partnership nonprofit fundraising opportunities. Then be sure to share the results so donors can see the impact of their efforts which often encourages them to continue their support for your organization.

Engaging Board Members For Large Gift Fundraising

Like all business organizations, nonprofits also struggle with getting everyone to do their fair share. In 2021, it’s crucial to understand how to engage board members in fundraising. The Modern Nonprofit offers these suggestions to get your board members excited about nonprofit fundraising.

  1. Add new board members. This can give new life to a burned-out organization and add a fresh perspective to one that’s still in top form.
  2. Set expectations. Tell new board members what your nonprofit fundraising goals are before they join the team, and then make sure all board members are involved in setting goals and planning your nonprofit organization’s strategy.nonprofit board fundraising responsibilities
  3. Create a fundraising committee to focus on meeting your goals.
  4. Strategize and refine your message. Give every board member the tools and resources to fundraise successfully.
  5. Offer recognition. It’s important to acknowledge board members’ accomplishments. This not only makes them feel good but witnessing positive feedback encourages other board members to want to get the same.

Have a Safety Net With a Nonprofit Line of Credit

If last year proved anything, we all learned how crucial it is to have a financial safety net in case of a crisis. Most nonprofit organizations know the pain when funding gets delayed, and yet, they are still expected to help their clients. That’s where fundraising and nonprofit loans can help. Obviously, making fundraising a part of the nonprofit organization’s strategy is fundamental, but perhaps adding a nonprofit line of credit should be as well.

At Financing Solutions, many of our nonprofit clients get their line of credit in place before they actually experience a need which is very smart. Cash flow forecasting and budgeting for nonprofit organizations is always a challenge because needed funds are not always readily available. Getting a nonprofit credit line from Financing Solutions means your organization is always prepared to meet its obligations.

Funding for nonprofits is frequently sporadic, yet expenses are usually fixed, which can cause occasional cash shortages. A nonprofit credit line costs nothing until it’s used, making it an excellent cash backup plan.

Getting funding for your nonprofit can be difficult because banks require personal guarantees—but at Financial Solutions, we don’t. No personal guarantees or collateral are required. Contact us today at 862-207-4118 to learn more or fill out our simple, 2-minute, no-obligation, nonprofit line of credit online application!

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