The less than good fundraising news continues to roll in. There was a small increase in total dollars donated (0.9%) for the first three quarters of 2024 but there were significant declines in donor participation, particularly among smaller donors (gifts less than $100), which had a 12.4% decline. Donor retention continued to decline (4.6%), marking the fourth consecutive year of year-over-year negative activity. 

These are among the data release by the Fundraising Effectiveness Project. The FEP is led by the AFP Foundation for Philanthropy and GivingTuesday. The data is contributed by 10 of the most active fundraising platforms. The data comes on the heels of a record-breaking $3.6 billion during GivingTuesday, which will impact the fourth quarter report.

“If we want to change outcomes, we have to change our practices. The sector remains too focused on large donors at the expense of broader engagement,” said Woodrow Rosenbaum, chief data officer of GivingTuesday. “The ongoing decline in donor numbers and retention signals an urgent need for strategic recalibration.”

The FEP tracks five levels of donors from “Micro” ($1 to $100) to “Supersize” ($50,00 and more). The number of Supersize donors, those fundraisers crave, dropped 4.9% with Small donors ($101 to $500) taking the largest plunge at 7%.

One-time donors, who contributed just less than half of the total dollars raised, had a year-over-year decline of 6.2%. Donors making multiple donations had smaller declines in dollars raised year-over-year, suggesting greater stability amongst these engaged donors, said Rosembaum. Although the decline in retention has been decreasing in magnitude during the past three years, the third quarter of 2024 marked a reversal of this trend, underscoring continued difficulty in re-engaging past donors in this quarter. 

New donor retention declined significantly (9%) year-over-year, with only 13.8% of new donors retained year-to-date. This underscores the persistent challenge of engaging and retaining first-time donors, he said. 

Repeat donor retention decrease 4.6%, but at 50.3% year-to-date, it remains significantly greater than retention rates for new and recaptured donors. This suggests that repeat donors are still more likely to give again compared to other groups.

Both the Micro organizations (less than $100,000) and medium-sized nonprofits ($250,000-$1 million) had improved fundraising performance compared to 2023. Dollars declined by 10.3% for the largest organizations ($5 million-$25 million) and 5.2% for Small organizations ($100,000-$250,000). This marks an increased decline compared to 2023, when the decrease was 9.9% and 1.5% for the largest and small-sized organizations, respectively, the data showed. 

Education organizations represent a significant portion of fundraising dollars at 19.6% and had growth of 2.7% year-over-year. However, the median year-over-year dollar growth across these organizations was negative 2.2%, indicating that the increase in total fundraising dollars was driven by a relatively small number of organizations, while many education organizations actually experienced a decline in funds raised. A similar pattern was observed for International, Foreign Affairs organizations. 

Arts, Culture, and Humanities sector experienced significant year-over-year declines in dollars raised, a result driven by large negative outliers, as evidenced by a more modest median decrease. This outcome is probably due to the sector’s relatively small total dollar size, which makes it more vulnerable to the impact of outliers, according to Rosenbaum. 

The data shows that environment & animals sectors reported median increases (up 2.7%) despite overall declines in total dollars raised across the sector.

Fundraisers need to change the way they think because the data shows missed opportunities, said Rosenbaum. “A scarcity mentality leads to practices that result in scarcity,” he said.  

The full Q3 2024 report is available here.

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Source From Non Profit Times