By Jacqueline Brennan
Blackbaud has been sharing trends and insights from their data on charitable giving for much of its 35-year history. Beginning in 2011, they took their sharing on nonprofit fundraising performance up a notch with their first report on charitable giving.
The 2016 Charitable Giving Report is both the fifth of its kind, and the first. Although it’s the fifth report put out by the cloud software company, it’s the first published by the Blackbaud Institute for Philanthropic Impact. To discuss what the 2016 report indicates about the present and future of fundraising in the social good community, we enlisted Steve MacLaughlin, vice president of data and analytics at Blackbaud.
IS: Tell us a little bit about the history of the Charitable Giving Report? When did you start releasing this information and why?
SM: Blackbaud first published the Charitable Giving Report in 2012 in response to our popular Blackbaud Index. While we had been publishing trends and blogging about insights from our data for years, it was the right time to start doing a formal report each year. Beginning with this year’s report, the Blackbaud Institute for Philanthropy Impact is publishing the findings.
IS: What most surprised you about the findings in the 2016 Charitable Giving Report?
SM: One surprise was that the combination of a strong U.S. economy, increased consumer confidence, and other positive trends had minimal impact on giving growth. Despite very positive economic and consumer conditions, charitable giving growth was just 1 percent. Gone are the post-recession larger growth rates. The new normal in fundraising may become low single-digital growth rates unless a broader spectrum of nonprofit organizations embrace the importance of donor engagement, retention, and stewardship.
IS: Who should be using Blackbaud’s data on online giving and why?
SM: The data and insights in the Charitable Giving Report are useful for nonprofits of all sizes and missions. In particular, it is a way for nonprofits to benchmark their own performance against thousands of other organizations. We break down the overall giving and online giving trends by both size and sector to make it more meaningful to organizations.
IS: This year’s report shows an overall upward trend in online giving. What factors led to this?
SM: Blackbaud continues to see growth in online giving with nearly all sub-sectors that we analyze. The shift to digital giving channels continues and this year-over-year growth is a positive sign. This is especially important because online giving grew nearly 8 percent in a year without significant international disasters or episodic giving that has occurred in past years.
IS: We’ve seen many headlines about record high giving to groups like ACLU and Planned Parenthood as a response to the current political climate. At the end of January, one article coined the phenomenon as “The Rise of the ‘Rage-donation.” Is there a connection between that and the surge in online giving specifically?
SM: Yes, several organizations have reported a sharp increase in giving following the 2016 U.S. presidential election. While there were numerous reports of increased giving to a number of nonprofits after the election, there is no evidence that this resulted in a significant rise in overall giving.
IS: Is there sense of what the continued rise in online and mobile giving could mean for nonprofit operations?
SM: There are three major factors that will introduce the growth in digital giving. First, over 17 percent of online donations are made on a mobile device and this is expected to increase every year. Second, as more Gen X and Millennials increase their charitable giving, the preferred method of giving is likely to be a digital experience. Finally, the growth in digital giving should eliminate a lot of friction and costs associated with traditional gift processing.
IS: What’s the next opportunity for innovation in online giving?
SM: The biggest opportunity for innovation in online giving is for a broader set of nonprofits to implement proven best practices. The first online gifts were made about 20 years ago and we have learned a tremendous amount about what works and what doesn’t. There is still a tremendous amount of growth potential if organizations begin using more proven strategies and techniques.
Jackie Brennan is the associate for social media and web at Independent Sector