November 1, 2008
By rating charities we endeavor to bring greater transparency to the charitable sector and in doing so, we strive to build productive, long-term relationships between donors and the charities they support. To that end, we thought it would be helpful for donors to hear from the charities themselves. So we asked various nonprofit professionals, charged with the task of generating contributions for their respective charities, to answer some questions about their fundraising practices.
Charity Navigator: As compared to last year, is giving to your charity up or down? If it is down, to what do you attribute the change – the economy or something else?
Boys & Girls Clubs of Metro Denver
"I'd like to encourage individuals to be selective and focused in making their charitable giving decisions... When donors make the choice to write larger checks to a smaller number of organizations, it allows them to be more connected with the organizations they support, and also allows nonprofit organizations to operate more efficiently and effectively."
Matthew M. Hoidal: Giving to Camp Sunshine is up significantly in our annual funding, up slightly in special events, and flat in endowment. Income being flat in endowment is fine, as last year was an outstanding year, so we are happy to continue on par with last year. And special events income increasing, if even a little bit, is good during this economy. Our real benchmark, however, is annual funding, which is the true foundation for the organization. It continues to build year after year. This is the real indicator of the health of the organization
Meryl Sheriden: At this point in our fiscal year, giving to HHC is up by 5% as compared to last year during the first quarter.
Kimber Leblicq: At the moment, the giving levels are generally tracking where they were this time last year. However, with the daily changes in the global economy and the uncertainty of the market, we are anticipating that this will reduce contributions to Seattle Audubon this fiscal year. We are concerned how this will impact our annual budget and the Board of Directors and staff are currently developing a contingency plan and adjusting the budget to adapt to outside issues.
Pamela Landwirth: Giving is down in 2008 primarily due to the economy, but other factors play a role as well. A significant portion of our contributions come from fundraisers held throughout the country with our wonderful corporate partners. Everything from the fires in California to the hurricanes that ravaged the Gulf Coast impacts those fundraising efforts.
Jennifer Wiemer: Our individual donations have been down sharply this year. Donations began to slow when rising gas prices were the big news story in the spring, and have continued to fall as the news on the economy has worsened. We also suspect that the large amounts of small donations raised by the presidential campaigns this year have siphoned off some donations to charity, particularly in a time when budgets are tight and people have a limited amount of money to give away.
David Glass: WWF completed its Fiscal Year ’08 in June and our membership program experienced revenue growth of 29% compared to FY’07. Online fundraising was the largest percentage driver of that growth.
Cynthia Allen Smith: Giving to our Annual Support Campaign is up 57% this year, and we have increased our number of donors by 36%. At the Central Florida YMCA, our members see our mission at work every day. Our Annual Support Campaign provides financial assistance and outreach to those in need. Typically, that can be a family in an underserved community who needs a place to spend time together in a wholesome atmosphere, or a child from a low-income community who wants to play in a YMCA basketball league. But in economic times like these, it can easily be your neighbor who just got laid off.
Amy Robinson: Thus far, giving to our organization is up this year, likely a result of greater investment in our resource development team and a greater investment of time in fundraising activities by members of our board of directors.
CN: Typically, what percentage of annual contributions does your charity receive between Thanksgiving and New Years? Do you expect to meet your goal for holiday giving this year? If not, what revenue generating strategies are you considering to offset the potential shortfall in donations?
Matthew M. Hoidal
“We just started using Facebook and it’s still too early to measure the results... at the very least, these sites offer a venue for our volunteers, families, and donors to connect with each other.”
Meryl Sheriden: 23% of donations come in between Thanksgiving and New Years according to data for the last 3 fiscal years and we expect it to remain consistent this year.
Pamela Landwirth: The percentage of contributions we receive during the holidays fluctuates, but historically it is around 13 - 15%. December continues to be our strongest revenue month as individual giving, year-end foundation grants and corporate gifts, and merchandise sales are significant sources of revenue. We do expect to meet our goal for this period.
Jennifer Wiemer: We typically receive around a third of all individual donations for the year in the month of December. We're expecting to take in less than the holiday season last year, but are hoping that with the election coming to an end, any effect that may have had on donations will be over and people will direct that discretionary spending back to charities. As always, we will continue to look for new ways to inform the public about the importance and urgency of our mission, and to engage people in the search for an AIDS vaccine.
Amy Robinson: We typically generate 35 to 40 percent of our contribution revenue during this time period. We do plan on meeting our goals this holiday season, but expect we will have to spend more in order to do so. We will be investing more time and financial resources in marketing, relationship building with individual donors, and pursuit of corporate sponsorships. We are also investigating non-contribution fundraising strategies such as raffles as a means of generating funds during this time of economic change.
CN: Although we continue to advocate that the best way to support a charity is to make a direct financial contribution, we also recognize that this year many Americans will have less money to spend on their charitable endeavors. So, this holiday season, we’re recommending that they buy holiday cards and gifts directly from their favorite charities as a way to be philanthropic even if they can’t afford to write a check to charity. Does your organization offer such products? What is/ has been the interest in these? How critical to your bottom line is the revenue from these items?
Cynthia Allen Smith
Central Florida YMCA
“Just as the economy is forcing a shake-out in the for-profit sector, I believe this climate will push many charities to become lean and efficient. Competition for donors, dollars, and public awareness will lead to more mergers and partnerships -- and that's healthy for all of us.”
Matthew M. Hoidal: We actually offer paper cards, and eGreetings. We have been particularly pleased with the success of our eGreetings, which donors can order at, and send through, our website. eGreetings are available for all holidays, birthdays, anniversaries, etc. The cost of the eGreetings to Camp Sunshine was a one time cost in the set up, but beyond that there is no cost to our organization, and the program requires no staff time (unlike paper cards that cost money to print, and require staff time to mail them out). eGreetings require a minimum donation of $10 and can be mailed to as many as 6 people at once.
We also offer bricks in our brick walkway, which donors can buy as gifts for people, and have the name of the gift recipient or a special message for them laser engraved in the brick. Bricks cost $100 or $250 for a 4” x 8” brick, and $1,000 or $1,500 for a 8” x 8” brick.
Bricks and eGreetings collectively raise as much as $50,000 for Camp Sunshine each year. Anything that raises this kind of money is critical to our bottom line. However, we have a plan in place, and a tentative donor in agreement, to sell $250,000 worth of bricks in 2009, in celebration of our 25th Anniversary. The donor will match all brick purchase up to $250,000, bringing our total to $500,000. Obviously this will have a huge impact on our bottom line.
Kimber Leblicq: I always encourage supporting a charity through “philanthropic shopping”. I think this is an admirable and important way to support nonprofit organizations while spreading their mission. Seattle Audubon does have a retail component, a Nature Shop “where profits are for the birds”. We sell bird- and nature-related merchandise and the profits provide essential funding for Seattle Audubon’s activities and programs. Nature Shop sales account for 61% of Seattle Audubon’s earned revenue and over 18% of the organizations’ total revenue. The Nature Shop accommodates 10,000 customer interactions per year including an online store.
World Wildlife Fund
“Direct mail has been a successful medium for WWF for many years. While its growth in the past few years has not been as strong as the growth in online revenue, direct mail still provides opportunities to connect with new and reinstate old members and donors.”
David Glass: WWF has an online gift center that provides several ways for someone to combine gift giving and charitable giving at once. Many of our donors had asked for a way to combine gift giving - especially at the holidays - with a charitable donation. A few years ago, WWF launched symbolic animal adoptions, where for a pre-defined donation amount, the donor would receive an animal plush as a thank you.
For this holiday season, WWF will have more than 90 animals available for symbolic adoption, ranging from a blue-footed booby to a koala bear. Notably, many of the animals available are listed on the IUCN Red List of Threatened Species™, including Critically Endangered species such as the Amur Leopard, Sumatran Rhino and Darwin’s Fox. Last year, to provide more gift-giving flexibility, WWF launched a gift adoption card that allows a contributor to make a donation and give the card as the gift. The recipient is then able to chose whichever animal adoption he or she wants.
The WWF online gift center also makes available apparel and sustainable crafts for those who are looking for something besides a symbolic animal adoption.
The online gift center has seen strong growth in the past few years, as fundraising has grown nearly ten-fold from FY’06 to FY’08. It has been one of the stronger factors in our online revenue growth.
CN: There are more than 1.5 million nonprofits in America and new ones are founded every day. Many of these offer duplicative programs and services. Do you think that the current economic climate can support this many charities or will the recession force more organizations to collaborate or merge? Does your charity have any plans in this area?
International AIDS Vaccine Initiative
“I personally think it is better for people to join forces with existing nonprofits rather than create new organizations if their services truly are duplicative, to cut down on administrative costs and free up more money for the programs that they exist to implement. Depending how long the recession lasts, it may force some smaller organizations to merge.”
Meryl Sheriden: I think that some of the smaller charities may have difficulty staying afloat and may need to merge. We are not planning to merge with another organization at this point, but it is always something to keep in mind if it would strengthen the ability to of the organization to meet its goals and remain financially viable. We are always willing to collaborate in ways that make sense.
Jennifer Wiemer: I personally think it is better for people to join forces with existing nonprofits rather than create new organizations if their services truly are duplicative, to cut down on administrative costs and free up more money for the programs that they exist to implement. Depending how long the recession lasts, it may force some smaller organizations to merge.
IAVI is the world's only global non-profit organization focused solely on AIDS vaccine development. As a public-private-partnership, IAVI partners with more than 40 academic, biotechnology, pharmaceutical, and government institutions around the world to speed the development of an AIDS vaccine. IAVI has a very diversified donor base, and is in a sound fiscal position to make it through these difficult economic times.
Cynthia Allen Smith: Just as the economy is forcing a shake-out in the for-profit sector, I believe this climate will push many charities to become lean and efficient. Competition for donors, dollars, and public awareness will lead to more mergers and partnerships -- and that's healthy for all of us. Over the past ten years, the Central Florida YMCA has been very pro-active in pursuing collaborations in both private and public sectors. These relationships with like-minded partners have produced dynamic results for our community, and we continue to view these as opportunities to expand the breadth and depth of our mission. We've established a full-service YMCA in a county park, created the first YMCA co-located with an Elementary School, and partnered with a community college to develop a YMCA on campus, each of which allows us to accomplish more for less.
CN: How has online giving to your charity changed in the last 3-5 years?
Matthew M. Hoidal: Online giving to Camp Sunshine has increased dramatically over the last 3-5 years. Part of this can be attributed to the tendency for folks to execute more transactions online vs. vial mail. Another reason for the increase is our move to making giving more convenient via online transactions.
David Glass: WWF has seen very strong growth overall in online giving in the last 3-5 years. In our most recent Fiscal Year, FY08, total online revenue increased by 80% from FY07 and about 325% from fundraising levels in FY06.
Online giving for WWF has four main components, with single online donations as the oldest form of online giving. The four categories are:
- The online gift center for symbolic animal adoptions and other gift items
- Recurring monthly donations
- Membership renewals
- Single donations
CN: Many of our users are opposed to receiving solicitations from charities that they’ve never heard of. They’ve also expressed their aversion to receiving numerous appeals from their favorite groups. In fact, some recent studies indicate that direct mail isn’t as effective at bringing in donations as it was in the past. Does your organization use direct mail and if so, have you seen a decline in giving via this method? Is there another fundraising strategy, such as an online giving campaign, that is replacing your direct mail campaigns?
Give Kids The World
“December continues to be our strongest revenue month as individual giving, year-end foundation grants and corporate gifts, and merchandise sales are significant sources of revenue.”
Meryl Sheriden: Yes, HHC does have a Direct Mail program that has been very successful in past years and instrumental in helping us reach our goals. Recognizing the value of online giving and the benefits of going green, we are slowly but surely leaning in that direction. Eventually, our hope is to do more online solicitation than direct mail.
Kimber Leblicq: Seattle Audubon uses direct mail, which generates approximately 6% of our annual revenue. We send 4 appeals per year to subsets of our donors and members; each appeal is sent to an average of 4,000 households. Our response to appeals has been relatively stable over the past few years, with an average response rate of 7%. We do not solicit outside of our organization and we do not share, trade, or sell our donors and members names to other organizations. We respect our donors and members requests to discontinue or limit the number of solicitations they annually receive from us. Being an environmental organization, it is our responsibility to walk our talk and reduce our use of paper products. Direct mail is one of our largest uses of paper, although we do use Forest Stewardship Council (FSC) certified paper. We are currently migrating to a new database system which will support an online giving campaign, reducing the use of paper and streamlining our administrative systems. This will ultimately make us a more effective and sustainable organization.
Pamela Landwirth: For many reasons, Give Kids The World has chosen never to use direct mail as a fundraising strategy. At this time we do not have an online giving campaign; however there is an online donation button on our website and we offer the ability to support our mission through internet-based resources such as Network for Good.
David Glass: Direct mail has been a successful medium for WWF for many years. While its growth in the past few years has not been as strong as the growth in online revenue, direct mail still provides opportunities to connect with new and reinstate old members and donors.
In the past two years, WWF has launched more integrated online and direct mail campaigns with good success. These campaigns have helped drive both direct mail and online growth. Many WWF donors are giving both online and by direct mail and we expect this group to grow.
Cynthia Allen Smith: For the YMCA in general, direct mail has never been our primary acquisition strategy. As a member-based charity, we have access to our donors and potential donors every day as they walk into our facilities! It's the personal relationships that allow us to be successful. Our appeals are geared toward "members asking members to help members." We only use direct mail as "clean-up" at the end of our annual support campaign, targeting only our members and former donors.
CN: Does your organization use social networking sites like Facebook and MySpace to promote your charity and fundraise? If so, how successful have those efforts been?
Seattle Audubon Society
“I always encourage supporting a charity through ‘philanthropic shopping.’ I think this is an admirable and important way to support nonprofit organizations while spreading their mission.”
Matthew M. Hoidal: We just started using Facebook and it’s still too early to measure the results. However, in just a few weeks on Facebook, our events have been attracting a lot of attention. Time will tell whether and how this attention translates into benefits for Camp Sunshine. At the very least, these sites offer a venue for our volunteers, families, and donors to connect with each other.
Pamela Landwirth: We do not use social networking sites to either promote or fundraise, but do appreciate the wonderful, inspiring stories found in blogs and the personal social sites created by our guests and volunteer Angels. While we do not encourage the use of these mediums, the positive experiences our guests and volunteers share provide the best possible advocacy for our Mission.
Jennifer Wiemer: Yes, IAVI has both a Facebook fanpage and a MySpace page. The pages have been moderately successful at promoting our organization and attracting fans and friends, but so far have not had an impact on fundraising. We're hoping that the pages will continue to grow in popularity so we can keep our supporters engaged and continue to spread the word about our mission to new groups, particularly young people.
David Glass: WWF has a presence on many social networking sites, including Facebook and MySpace. Our primary goal on these sites is to engage with current and potential donors “where they are” and share a variety of conservation content to educate, inspire and promote action. Facebook Causes has helped WWF generate a small amount of donation revenue and the WWF Cause has nearly 1 million members affiliated with it. Specialty applications like SocialVibe also provide more direct fundraising opportunities to non-profits like WWF.
Amy Robinson: We recognize the amazing potential that social networking sites bring to nonprofit organizations like Boys & Girls Clubs of Metro Denver and have begun including such sites in our fundraising strategies. We currently have and maintain a Facebook page, but have not fully explored its potential, largely because we have not had a specific individual with time to focus on these initiatives. At this point, we are doing very little fundraising using social networking sites, but would like to explore this option in the future.
CN: If you could change the giving habits of individuals, what would be the number one change you'd like to see?
Horizons for Homeless Children
“We are not planning to merge with another organization at this point, but it is always something to keep in mind if it would strengthen the ability to of the organization to meet its goals and remain financially viable.”
Kimber Leblicq: Seattle Audubon is fortunate to have the support of active and generous donors. I would like to encourage and see more donors consider multi-year pledges and monthly giving. It is our responsibility as a nonprofit organization to communicate to donors how important this is for supporting ongoing programs and for budgeting for the future. We also need to earn the trust from donors that our organization is worth the long term investment.
Cynthia Allen Smith: Whatever cause you choose to support, commit your gift early in the year! Expenses for printing and postage keep going up, up, up, and our donors don't think about how successive mailings drain resources. They have good intentions and plan to give, but the procrastination diminishes our ability to put their gift to work efficiently.
Amy Robinson: I'd like to encourage individuals to be selective and focused in making their charitable giving decisions. Many donors write a small check to every organization that sends something in the mail. While these donors mean well, this approach doesn't really accomplish much for the organization…or the donor! Donors should spend time identifying causes they care about and then support just a handful of organizations doing good work in these areas. When donors make the choice to write larger checks to a smaller number of organizations, it allows them to be more connected with the organizations they support, and also allows nonprofit organizations to operate more efficiently and effectively.