Donor attitudes to giving in the credit crunch, Feb 2010

1. Donor Attitudes to Giving in
the Credit Crunch
Monthly Monitor Report
May 2010
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 1

2. Table of Contents
Background Page 3
Wider Economic Climate Page 4
Summary Findings Page 7
Responses Page 8
Observations and Recommendations Page 15
JustGiving
30 Eastbourne Terrace
London
W2 6LA
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 2

3. Background
About JustGiving
JustGiving is an online fundraising platform enabling people to raise more money than they ever thought
possible for the charities they care about. To date more than half a billion pounds has been raised through
JustGiving for over 8,000 charities. The JustGiving community is a 10million-strong group of people passionate
about supporting the causes they care about.
JustGiving helps charities raise money, extend their brand online, and forge deep and sustainable relationships
with their supporters. Charities trust us for treating their supporters with respect: we won’t spam them, sell, trade
or share their personal data with any third party (even our US sister company, Firstgiving) or sell them anything.
This is why many charities who take a strategic view of their online fundraising choose to continue to work in
partnership with us: they value our dedication to the sector, the sustainability of our model, and the responsible
way in which we treat their supporters and their data.
About this report
As part of our commitment to providing excellent online fundraising insight, in January 2009, we started to track
donors’ attitudes to giving in the recession as well as their projected giving pattern over time.
The monitor covers 17,927 responses made to an online questionnaire between 1 January 2009 and 28
February 2010 inclusive. Respondents were randomly selected after making a donation to charity on the
JustGiving website. Initial reports were circulated on request in February and March 2009, at the height of
concerns about the economy. This is the last report and examines the results of the attitudinal survey and puts
the trends in the context of the wider economic climate, garnered from various sources. For each of our survey
questions we’ve included the relevant graph charting the trends and a commentary of the results.
Please feel free to circulate or use extracts of the report, but we do ask that you acknowledge JustGiving as the
source (or credit the external sources we have used, as appropriate). Sources are listed in full at the end of this
report.
This report was written by Niamh Neville and Jonathan Waddingham.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 3

4. The Wider Economic Climate
The wider economic outlook clearly plays a large part in attitudes to charitable giving, so we thought we’d take
a look at what was happening in the UK economy as a whole before drilling down into how donors responded to
our survey.
Taking a number of sources, it appears there was more than during the rest of the year financial uncertainty in
the first quarter of 2009.There are a few contributory factors - one is that the Dow Jones and FTSE index both
hit their lowest points around that period. In addition, the UK budget deficit was announced on the 22nd April,
leading to gloomier headlines as the recession hit harder. UK unemployment steadily rose as did reported
redundancy figures. We’ll look at these factors in full, below.
Financial Markets
Figure 1
The chart above, taken from the BBC News1, tracks the Dow Jones and the FTSE 100 indices. The arrows
along the top indicate important events. The lowest point for both indices came in the last week of February
2009 thereafter they both slowly start to climb back up.
On the 22nd April 2009, Chancellor Alistair Darling revealed that the credit crunch will lead to the largest budget
deficit in UK financial history of £175bn, with total government debt set to double to £1 trillion by 2014. Mr
Darling admitted that it would take two Parliaments, or 10 years to get the budget back to the position it was in
before the credit crunch.
Clearly this sent uncertainty through the markets, which is reflected in the FTSE 100 Index falling below the Dow
Jones between the two arrows farthest on the right.
Redundancies and Unemployment
Next we look at how the macro-economic picture manifested itself at an in employment security. Reported
redundancy figures2 were also up in the first quarter of 2009 against 2010 at a total of 67,885, (Figure 2)
January/February year on year figures were 47,174 in 2009 versus 10,608 in 2010; so reported monthly
redundancies have decreased this year.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 4

5. Figure 1 *Confirmed redundancies as reported in the media – source Personnel Today.com
Looking at unemployment figures3 (Figure 3) these steadily increased in the first half of the year, tapering off
from July onwards. News headlines throughout the year reflected the rising unemployment, more than likely
adding to the feeling of financial uncertainty, which we examine in more detail overleaf.
Figure 3 Source – Office of National Statistics
Consumer Confidence
Since May 2004, the Nationwide Building Society has run a Consumer Confidence Index measuring the
population’s view of the current economic position and future prospects of the UK. Carried out by TNS, 1,000
adults are interviewed each month, with the sample structured to be nationally representative of all adults in
term of age, sex and socio-economic group. The index takes into account the general economic situation,
employment conditions and personal expectations of the months ahead.
The index uses a similar methodology to that of the US Conference Board; the most highly regarded Consumer
Confidence Index in the US, widely acknowledged as a key US economic indicator.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 5

6. When measuring Consumer Confidence, Nationwide looks at how consumers feel about five separate elements:
1. consumers’ view of the current economic situation
2. consumers’ view of the economic situation in 6 months’ time
3. consumers’ view of the current employment situation
4. consumers’ view of the employment situation in 6 months’ time
5. consumers’ expectations for their household income in 6 months’ time
Taking a section of the Consumer Confidence Index since January 2008, figure 4 shows the indices for each
month. The lowest points are in January 2009 at 40 points, recovering in May/June to levels seen in the latter
half of 2008. As 2009 progressed the index increased well into the seventies and is the highest in two years in
February 2010.
Figure 4 Source: TNS-RI research for Nationwide
So, the external factors combined add up to a worrying picture in the first quarter of 2009, which eased
somewhat from the second quarter onwards, showing a strong recovery at the beginning of 2010, soon after the
announcement that Britain was officially out of recession in late January of this year. We’ll examine now how this
is reflected in our survey.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 6

7. Summary Findings
We ran our survey from January 2009 to February 2010; a period it’s fair to say was one economically
challenging. In early 2009, consumer confidence was low and redundancy and unemployment figures were
rising. Over half of respondents to our survey, unsurprisingly, said they had felt the effects of the credit crunch
and many were considering cutting back on household expenses – especially eating out and holidays. People
were less inclined to cut back on gym membership, satellite TV, mobile phone and savings accounts.
On average more than half (56%) of respondents had thought harder about giving to charity with 44% on
average considering reducing or stopping giving, the pattern remained fairly constant over our survey once the
effects of the credit crunch really hit home from March onwards.
Of those that told us that they had been affected by the economic downturn, 36% on average said they were
giving about the same to charity versus the 45% that were still giving but a bit less.
We also learned that although charitable giving is still important for many, it is seen as discretionary spending
alongside household expenses such as mobile phones and satellite TV or savings accounts and people were
more likely to give a little less to charity than cut back on these expenses. Of course this could be because
household expenses can seem like fixed costs and saving for the proverbial rainy day can seem more important
in a period of financial uncertainty.
However, year on year, in many respects the future is looking brighter. Consumer confidence is increasing
and when we asked if people would need to reconsider how much they gave to charity over the next three
months the proportion of people considering they’d give less tended to decrease over the course of our survey
and those that thought they’d give at the same level conversely increased. This is good news, which is clearly
supported by increasing confidence and while people are tending to remain cautious about spending and
charitable giving, most are not cutting back.
In fact some donors are actually giving more, so seem to feel it’s more important than ever to give more to
charity than before.
Overall, now that the economic recovery is underway we’d say that the outlook looks good for donations on
JustGiving; in fact we are experiencing higher than average amounts raised on an individual for the London
Marathon and expect the online giving market to continue to grow.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 7

8. Responses
Have you been affected financially by the recent economic downturn?
Figure 5
Each month, we asked if respondents had been financially affected by the economic downturn. There are
variations throughout the year on responses to this question but they are relatively small – between 5 – 8%
across the responses. This pattern is different to the Nationwide Consumer confidence survey which includes
questions about how consumers will view the economic situation in 6 months, so our survey gives an indication
of how many respondents consider that they have been affected.
For those that felt they were affected by the economic downturn, on average 54% of respondents throughout the
year, there were key months when the responses peaked – March/April and December with 57%/58% and 57%,
respectively. This is broadly in-line with what was happening in the overall external economic context. It’s worth
noting that the month of December is often a month of depressed consumer confidence as people worry about
the added cost of Christmas.
Year on year, January/February responses remain fairly similar: those answering Yes in 2009 was at 51.4%
versus 52% in 2010. Again, year on year, there’s a similar trend for respondents who felt they had not been
affected, which is on average 35% across the monitor but this is slightly higher this year with 35.3% in January/
February 2009 against 38% in the same months of 2010.
Therefore JustGiving users are perhaps starting to feel less affected by the credit crunch, but it’s still a financial
concern for over half of them.
Our next question was to see the impact of the economic situation had on respondents’ giving attitudes.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 8

9. In the past three months, have you thought harder about how
much you give to charity?
Figure 6
With a marked change from March onwards, respondents are clearly reassessing their charity giving, as the
recession bites, people are thinking harder about how much to give. Peaks can be seen in March/April and from
October to December 2009. Throughout the year this increases slightly, but the clear trend throughout the year
is that more than half of the respondents are evaluating what they give to charity.
We then went on to ask about respondents’ charitable giving.
Has this resulted in you changing your charity giving?
Note: We changed this question from March, as in February some people told us they were giving more.
Figure 7
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 9

10. Overall, the majority of people are saying they give about the same (on average 41%), or a little less (on
average 39%). However, as time goes on, we see a small increase in the number of people reporting that they
are giving more than before and a decrease in people saying that give about the same. To make that easier to
see, we’ve split it out in the following charts.
Figure 8
Colour-coded linear trendlines have been added so to make this clearer. On average, 41% say they give about
the same but the trend is decreasing slighty. A small proportion of respondents (15% on average across the
year, but rose to almost 22% in February) are saying that they give more than before. In January/February
2009 86% said that they gave less than before (but there were fewer options to choose from) but thereafter the
proportion saying they give less than before is around 35% on average.
Figure 9
A tiny proportion (3% overall) say that they have largely stopped giving (although bear in mind that they have
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 10

11. just donated on JustGiving). Then a slightly larger, 6.5%; proportion of people say they’ve cut back a lot. We
thought it would be useful to compare this reported data against the actual average gift on JustGiving.
Figure 10
A total of 1,280 respondents to our survey stated that they were giving more to charity this increased
proportionately as they year went on and in fact, this is borne out by the average gifts across the site.
As the year progressed the average gift trend did, in fact, increase. Interestingly, the average in January year
on year is the same, despite respondents feeling slightly more affected by the downturn in 2010. This appears to
correlate with the economic indicators showing consumer confidence increasing as 2009 went on. Certainly, our
survey shows that a proportion of respondents said that they gave more than before as the year went on, with
the exception of September (figure 8), which does correlate with the average gift in figure 10, above.
It should be noted that December is always a strong month for average gifts on JustGiving.
Going back to our survey, we wanted to explore whether being affected by the credit crunch meant the
respondent thought harder about their charity giving, so we combined the results of two questions.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 11

12. Figure 11
Firstly let’s look at those that said they were unaffected by the credit crunch. 27% of them said they gave more,
maybe feeling that charities needed their donations more than ever, while 46% said they about the same, so
almost three quarters (73%) gave the same or more than before. Then 23% of people who said they were
unaffected by the credit crunch said they were giving a bit less, 3% said they’d cut back a lot and a tiny 1%
largely stopped giving.
Of those that had been affected by the credit crunch, 8% said that they gave more and 36% said they were
giving about the same. Then unsurprisingly amongst those that the credit crunch affected, 45% said they were
giving a little less, with 8% saying they cut back a lot. But only 3% of them said that they’d largely stopped
giving. So, even people affected were still giving to charity, although more than half of them had cut back; it’s
encouraging that over a third said they were giving at the same level as before.
Looking at the proportion of those who were unsure about being affected, over half (57%) were giving the same
or more, whereas 37% were still giving, albeit a bit less, making the vast majority of them (97%) still giving to
charity.
Overall, our respondents clearly felt charity giving was still important and were overwhelmingly still giving.
As the questions about were about what was happening now, we wanted to take a look at what respondents felt
might happen in the future, so we next asked people to look forward to the next three months and consider how
their giving might change, regardless of whether they’d reviewed it previously or not.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 12

13. Do you think you will have to reconsider your charity giving in
the next three months?
Figure 12
This question was to try to ascertain how people might give in the short term. We asked if people were likely to
reconsider their giving over the next three months.
On average the proportion of respondents who said they may consider stopping giving to charity was less
than 2%. The average for those that considered they may cut back a lot was 5.5% and never rose higher than
January/February 2009, when it was just shy of 7%.
Those that don’t think they will reconsider their giving levels throughout the year account for at least 61%,
steadily increasing as time went on. Obviously this is excellent news, showing again that people do think charity
giving is important.
The key for charities is to ensure that they retain this continued support and when times get better, hopefully
increase it. At JustGiving we constantly hear supporters tell us that they want to know what charities do with
their gifts, before they’re asked to give again.
The proportion of people who think they may give a little less generally decreases throughout the year, but on
average they make up just over a quarter of all respondents at 27%.
Overall it’s good news again, with people more likely to keep giving as they are and less likely to cut back on
their giving in first two months of 2010.
So, if people are generally not cutting back on charitable giving, are they cutting back on anything else?
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 13

14. Are you considering cutting back on any of these household
expenses?
Figure 13
We wanted to compare charitable giving to other expenditure, so we asked if people were thinking about cutting
back on common, discretionary, expenses.
The good news here is that people were less likely to cut back a lot or stop their charitable giving than any of
these household expenses (see Figure 12).
There are some interesting results in figure 13 though. The majority of respondents, on average 73% were
considering cutting back on eating out and over half – 54% – were thinking of cutting back on holidays.
However, as previously noted above, an average of 27% people said they might consider giving a little less to
charity, higher than the average considering cutting back on gym membership (24%), satellite TV, mobile phone
and savings accounts (20% each).
Research by nVision and the Future Foundation suggests that mobile phone upgrades and HDTV are seen
as barely discretionary – more necessities than luxuries and put charity giving in the same category. For some
people, opting out of TV and mobile phones are seen as opting out of society, whereas charity giving is arguably
more discretionary.
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 14

15. Observations and Recommendations
While the fundraising landscape seems to be getting better, there are still tough times ahead. Charities are still,
increasingly competing against each other for discretionary spending in a time of financial insecurity.
To attract donations, it’s clear that having great reasons to donate is still vitally important. The online donations on
JustGiving are generally different to other donation channels in that the request for gifts has come from people doing
events to benefit the charity. It’s hard to refuse a friend or colleague, especially those passionate about the cause or
those undertaking an impressive feat for charity.
Charities should also make sure they have a presence in channels that people are still using; only 20% of our
respondents were cutting back on mobile phones or satellite TV, so these seem like good channels to consider as part
of the marketing mix. DRTV has become more popular with charities taking advantage of the reduced media costs.
Mobile is emerging as an important new channel; people have their phones with them all the time and the popularity of
smart phones make the possibilities for fundraisers virtually unlimited.
Having a seamless supporter journey helps too, people are, in the main, happy to donate to charity but it needs to be
part of everyday life – something we, at JustGiving, are tirelessly working towards. To that end, we’ve just launched a
new iPhone application, allowing fundraisers to update, share and view their pages on the go. They can also instantly
see donations and messages made to their page – they can then send a quick text message to say thanks and see
how close they are to their target.
Sources
1 Dow Jones and FTSE index chart and http://news.bbc.co.uk/1/hi/business/8242825.stm
2 Reported redundancy figures Personnel Today.com
3 National Office of Statistics www.statistics.gov.uk
4 Nationwide Consumer Confidence Reports
http://www.nationwide.co.uk/publicaffairs/briefings/EconomicBulletinFebruary2010.pdf
Useful sites:
http://www.ft.com/reports/
http://www.barclays.co.uk/commercial/turningthecorner/insight/
http://www.futurefoundation.net/nvision.php
And of course – www.justgiving.com
For our latest news, research and insight, visit our blog at http://blog.justgiving.com/charities/
You can also join in the conversation with us on Twitter and Facebook – let us know what other research we could do
to help you.
http://www.facebook.com/justgiving
http://twitter.com/justgiving
JustGiving - Donor Attitudes to Giving in the Credit Crunch
Page 15