Emerging Markets in the USA for Nonprofit FundraisingPresentation Transcript
Emerging Charitable Markets in the USA: Giving in the New Economy Sunday, September 23, 2012 Avrum D. Lapin @EHLConsultGrp #newUSmkt
The EHL Consulting Group, Inc.• More than 20 years of experience in… – Fundraising & Campaign Management – Strategic Planning – Leadership Development – Nonprofit Business Planning – Creating Innovative Campaigns – Donor Research & Stewardship• We have worked with over 350+ organizations,including many Israel-focused organizations.
Today’s Presentation: Sources• Giving USA 2012: The Annual Report on Philanthropy for the Year 2011• Bank of America High Net Worth Study: Behaviors of Wealthy Donors• Center on Philanthropy Panel Study (COPPS)• Million Dollar List: Scaling Philanthropy• The Chronicle of Philanthropy’s New Report: How America Gives
The New Economy: Evolving Expectations• Increased competition for charitable dollars• Donors want to be personally engaged with their philanthropy and see impact• Both funders and donors seek more involvement, information & innovation• Demand for demonstrable evidence of how their dollars are making an impact
Million Dollar Plus Gifts and the EconomyImage Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Enterprise and Finance: The New Major Donors• The most recent Forbes 400 List reveals that 134 of the wealthiest Americans identify as Jewish – 1/3rd of the entire list!• 63% earned wealth as entrepreneurs• 30% earned wealth in finance/private equity• 7% inherited family wealth• 0% were professionals
Average Annual Giving By Source of Net-Worth/Wealth Based on a scientific random sample of high net-worth households in the United States ($200,000+ of household income or a net-worth of $1,000,000+)Image Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Jewish Donors: Out of Love with Jewish Causes?• Emerging major Jewish donors may hold a different view of Israel than previous generations• Of the top 150 gifts made in 2012 reported by the Chronicle of Philanthropy, only 30 of those gifts were committed by Jewish individuals• Only six of them were given to Jewish causes• Two of those six gifts were from the same donor.• We are seeing a fall in faith based gifts, and a rise in secular gifts at all giving levels.
Giving Amount Over Time for the Average American Household : 2000 -2008Image Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Motivations for Giving• The most important driver: Who asks!• Connection to the organizational vision and scope of its thinking and reach• “Philanthropic ROI:” Perceived impact of gift• Charisma and perceived efficacy of leadership• Financial position of the organization• Accountability, transparency & governance• Donor Recognition
Individuals Give the Biggest Gifts! Based on a total of 61,461 qualifying gifts of $1 million + given from 2000 to 2010Image Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Average Major Gift Size by SubsectorImage Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Emerging Markets: A Review of “How America Gives”• The Chronicle of Philanthropy’s report based on analysis of federal tax returns for household incomes $50,000+• Study only reflects donations reported as deductions to the IRS• Researchers calculated each state’s median discretionary income —money remaining per household after essential costs are paid for• Then looked at percentage of discretionary income that each state’s typical household gave to charity
Is it time to Go West?• The Northeast, with lower religious participation, was the least generous to charities giving only 4.1% of their discretionary income to charity• The national average was 4.7%• The percentage was higher (5.2%) in the Southern states, a region from Texas east to Delaware and Florida.
Geography and Million Dollar Gifts Based on a total of 61,461 qualifying gifts of $1 million + given from 2000 to 2010Image Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Up-and-Coming Markets• Nassau County, NY: Nassau County residents reported giving more than $1.3 billion on their annual tax returns, over 10% of the charitable donations catalogued in the entire New York metropolitan area• The New Jersey Suburbs: Trenton (10% of annual disposable income), Willingboro (8.5%), Plainfield (7.7%), and Lakewood (8.6%)• South Carolina: North Charleston (7.4% of annual disposable income), Columbia (7.6%), and Port Royal (7.8%)• Remember: The national average was 4.7%!
Look to the Middle Class• People who earn $200,000 per year give a greater percentage to charity when they live in ZIP codes with fewer people who are as wealthy as they are• People who earn between $50,000 and $75,000 annually give a higher percentage of their discretionary income to charity (7.6%) than those who make $100,000 or more (4.2%)
The Rise of Giving Vehicles Considering the increased use of investment-based gifts, today’s average donors could be tomorrow’s major donors!Image Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
Mid-High Income = More Stable DonorsImage Courtesy of Una O. Osili, Ph.D. Director of Research,The Center on Philanthropy at Indiana University
The Major Jewish Woman Donor: Emerging Major Philanthropists• New research by the Women’s Philanthropy Institute suggests that older women are more generous than their male counterparts• Gave 86% more to charity than males of comparable age and wealth• In the households with the top 25% of permanent income, women gave 156% more than similarly placed men
The Major Jewish Woman Donor: Motivations and Interests• Study suggests that older women “share their resources with others more generously than their male peers"• WPI’s previous research found that women tend to be more altruistic than men and that “their giving is frequently motivated by the desire to make a difference in peoples’ lives”
Success for Smaller Nonprofits• According to the July 2012 Blackbaud Index of Charitable Giving, small organizations (revenue less than $1 million) led the overall growth with a 7.1% gain in overall charitable contributions, and a 14.6% increase in the number of online gifts• Gifts to medium organizations (revenue between $1 million and $10 million) increased, showing a growth of 1.4% overall, online giving increased to 9.6%• Large organizations (revenue more than $10 million) saw a decline in fundraising: 2.l% overall and 1.7% online
Getting Out of the Office…• Networking – Make regular visits to the USA to engage existing supporters and meet new ones; who are your USA- based advocates? – Attend professional development events ready to make connections and speak about your cause• Meeting – Conduct advanced funder/donor research – Introduce yourself often and listen with interest – Always follow up with new connections!
…And Out of Your Comfort Zone• Speaking – Understand the key points you want to make in each conversation; be ready with success stories – Familiarize yourself with “stateside” vocabulary for discussing impact, programmatic needs & fundraising• Communicating – Know your “elevator speech” and success stories – Use Google Alerts to keep up-to-date on topics of interest in your organization’s area of interest
Donor Identification and Research• Donor research – Find prospective major donors from your past (lapsed), present (increased capacity) & future (new prospects) – Utilize research software and online databases – Keep an up-to-date, organized donor management system, preferably online – Strengthen your connections to people you know and introduce yourself to those that you don’t • Review major prospect list with staff and Board • Send personalized letters of introduction
Online Media Engagement• Utilize multi-channel marketing – Online communication can help build relationships and create advocacy/awareness for your cause – Email marketing/fundraising is still most popular and effective, plus has proven metrics – Always drive traffic back to your website, where you can make your case most effectively
How can EHL Consulting help YOU?• We have three decades of experience in building relationships and creating campaigns in the U.S. for domestic and Israel-focused organizations. • Strong knowledge of Israeli nonprofit environment • Industry reputation as one of only 38 Members of The Giving Institute, a national monitoring organization • Experienced, diverse team of professionals from nonprofit, development & marketing backgrounds
Our Services for Israel-Focused Organizations1. Building capacity, including Leadership Development2. Guiding and directing all fundraising efforts, including full representation, in the U.S.3. Framing and marketing your organization’s unique message for a U.S.-based audience4. Conducting advanced Donor Research and Analysis5. Creating presence, traction & sustainability
For More Information:Our website: www.ehlconsulting.comAvrum’s email: email@example.comFacebook: www.facebook.com/ehlconsultingTwitter: @EHLConsultGrp