5 Fundraising Trends to Watch in 2022
Click here to read on Classy.
By Chris Himes
In 2021, the social sector mastered the art of resilience. We saw countless organizations craft donation experiences that not only sustained a year-plus pandemic but set new standards for fundraising excellence.
This last year reinforced the need for us to continue offering tools that help the nonprofit sector connect to donors successfully without physically being in the same place. This includes reimagining events in a virtual or hybrid format, increasing the support nonprofits see from sustained recurring donations with more options to give, and overall innovation to make the experience easier for all involved.
So what's still ahead? I've taken a long look at the successes we've seen over the past year and gathered my own predictions on where the social sector is headed.
5 Nonprofit Fundraising Trends to Watch in 2022
1. Flexible Giving Options Will Unlock Generosity
Heading into 2021, we predicted that adaptability would be critical for nonprofits. That was immediately evident as the pandemic challenged the sector. I believe adaptability will continue to be a strategic imperative, specifically around donor preferences and their desire for more mobile giving options.
Data from our annual Why America Gives report shows that donors are not only starting but completing more donations on their mobile devices than ever before. There's also growing enthusiasm around giving through QR codes, smartwatches, and wearables.
Successful service-based software brands know they need to meet users where they are and anticipate where they're going. There is no doubt in my mind that nonprofits will advance their online fundraising experiences to meet the evolving needs of their donors if they incorporate these preferences when setting up their donor acquisition and conversion strategies.
5G and the reliance on smartphone transactions requiring only a face scan suggest that donations will remain mobile and mimic the elegance of strong in-app experiences to avoid the abandoned cart effect. At Classy, we're quickly working to deliver innovative ideas via solid and reliable technology.
Flexible Donation Options Will Include:
Below are a few methods I believe nonprofits will use to create a more nimble fundraising strategy.
- Convenient digital wallets, like Google Pay and Apple Pay, automatically populate payment information on a donation form through secure facial recognition, eliminating the need to leave the page or reach for a physical check or credit card.
- Hybridization of giving campaigns blurs the lines between fundraising actions to offer donors the opportunity to show their support in multiple ways. Ahead of an annual 5K or large event, donors could upgrade their one-time donation to a friend's peer-to-peer fundraiser into an automatic recurring donation to the organization.
- Cryptocurrency donations will soon make waves in the nonprofit world. With a marketplace worth over $3 trillion and more than 100 million users across the globe, cryptocurrency is an entirely digital payment method that is tax-deductible when donated directly to a nonprofit organization. Only a few hundred nonprofits have this option available to donors right now, but I anticipate this number will increase significantly over the next year.
- Trusted payment apps, like PayPal and Venmo, will drive increased action from supporters who have already established trust (and account balances!) with these platforms; they can quickly pull stored information from their phones to make a donation, which they likely already use for other online transactions.
Donating through PayPal or Venmo captures the interest of 55% of donors who share they would likely donate if nonprofits presented these options.
2. Donors Will Pave Their Own Path to Personalized Experiences
In 2021, Apple released several privacy updates that changed the way brands track consumer engagement, limiting email open rate data and activity tracking among IP addresses. We'll likely see more privacy updates in the coming year as additional companies choose to prioritize consumer data rights.
In light of Apple's privacy updates, I expect to see nonprofits adapt the ways they reach and connect with donors. There will be more focus on letting donors choose how and where their information is shared, and how they like to be engaged with as a result…but this is also a form of donor empowerment.
Personalization will be critical to build relationships that result in loyal donor bases. Nonprofit interactions with supporters will need to be tailored according to their stage of life, intent, and preferences for communication. We've tracked the most recent generational preferences, but there's a lot a nonprofit can learn from looking within their specific donor base.
We'll start to see nonprofits leaning into the data they collect first-hand from donors on subscription forms and surveys, focusing on opt-in permissions that will guide their outreach. For some, it may mean ramping up text message sends around key campaigns and even offering text-to-donate capabilities for donors who express a desire to get instant updates.
For others, it may mean that major donors receive more regular program updates in response to communication frequency preferences and trends for this specific segment of supporters. We could even see nonprofits pivot to a social media-only strategy for campaign promotion to meet donors where they prefer to engage.
3. Tech-Driven Experiences Will Advance Fundraising Events
Between 2020 and 2021, live streaming platforms became valuable tools to virtually connect with donors when in-person events weren't possible, but hybrid is so much more than that. Hybrid events in 2022 will benefit both in-person and virtual attendees with advanced, tech-driven experiences that take lessons from the many virtual events staged during the pandemic.
If nonprofits are national, hybrid is a way to stay frictionless. For local organizations, hybrid can open new opportunities to enhance live events. Technology-driven experiences will continue to bring causes beyond their physical city borders. Even when we're in person, there are innovative capabilities that can be used during events to shape the way we connect with donors.
Technology-Driven Experiences That Will Shape Events
Here are several technology-driven experiences I see nonprofits exploring in the year to come:
- Creative NFT auctions will bring even more value to event attendees and nonprofits as these non-fungible tokens are sold by NFT artists in exchange for donations. Imagine an environmental nonprofit that can connect with their donors to actually own a representative piece of that environment they are protecting (like an NFT representing a square mile of Amazon rainforest or the Great Barrier Reef)? It's impactful and engages donors in a new way that makes them want to stick around and promote the organization to others.
- Mobile bidding on cell phones allows participants to engage in an auction alongside a virtual audience, increasing competition and tracking every transaction in one place. This also means you can incorporate a direct appeal like Pro-Choice Washington did to bring in 30% of their total donation volume during their annual gala and silent auction.
- Widely-available event recordings turn key moments or specific speaker presentations into on-demand videos to repromote and collect registrations long after the live event date passes, like 65.9% of event organizers who make their virtual events available on-demand after the fact.
- Native streaming to host live or existing content through Zoom, YouTube, or Vimeo as part of an engaging speaker experience during events.
- Text communication to chat, poll or update attendees throughout the event.
- Instant engagement through push notifications before, during, and after an in-person event to capture every moment and opportunity to make a donation appeal in real-time.
The goal of our recent acquisition was to offer a robust virtual and hybrid event solution that supports donor engagement promotes fundraising and enables admins to run their events with ease. Classy Live will make fundraisers more effective in engaging their supporters and forming relevant connections that last.
4. Recurring Giving Will Expedite the Move to Fundraising Entirely Online
Recurring giving is already a valuable tool for nonprofits, accounting for 26% of online revenue for organizations that raise over $50 million in total donation volume on Classy, as noted in The State of Modern Philanthropy. There are still over $400 billion of offline donations that nonprofits process, many of which could be transferred online through recurring giving programs to save both time and resources.
Recurring giving is for any size organization. Just like the trends we see in FinTech to bring high-grade tools to smaller organizations, recurring donor management through fundraising technology will allow any nonprofit to get more donations online.
The technology is simple, and the impact of just a handful of recurring donations made, tracked, and nurtured online can mean sustainable income for years ahead without requiring additional resources.
In the year to come, I believe there's an opportunity to turn every check-writing donor into a monthly ACH donor. The rise in QR code usage to promote donation pages and information sharing will also be a way for nonprofits to transform their physical mailers and transition donors into the online system for simpler tracking all around.
5. Workplace Giving Will Evolve and Grow in Importance
Workplaces are often collections of individuals passionate about causes they relate to. Approximately $5 billion is raised through workplace giving annually.
Employee engagement programs and the heightened desire to make an impact (alongside the Great Resignation) are leading people to look for more purpose in their day to day. Nonprofits can meet the moment by bringing their missions to workplaces knowing that donors are likely to find out about new causes through word of mouth within their close circles.
As workplaces continue to operate remotely in some fashion, employees can connect through their charitable interests or introduce new people to a cause they care about through the workplace. It'll be how nonprofits introduce a giving experience at work that matters.
Potential Is High for Workplace Giving
- Internal communication through platforms like Slack will fuel organic employee outreach and fundraising opportunities.
- Giving recommendations could give employees curated suggestions for causes they'd connect most with, the same way Spotify builds a playlist.
- Corporate donation matching will play a more significant role in enticing employees to support causes that their employers feel connected to.
- Designated time to give back will rise in importance as more employees seek companies based on values. Classy, for example, designates October as a volunteer month to empower employees with charitable opportunities nationwide, in addition to their year-round volunteering.
The Future of Fundraising Is in Our Hands
We've learned a lot in the past year about what fundraising trends to expect in 2022 as technology and convenience come together as top priorities. We've found that online fundraising that prioritizes personal connection and donor choice will be at the core of why people choose to give.
Nonprofits will ultimately need to be adaptive, flexible, and fluid with the presented opportunities to build enhanced experiences with technology. Generosity is unlocked when donors feel fulfilled, understood, and connected before, during, and after the donation process. To do this, nonprofits need to give donors the choice of how they want to donate and how they want to be engaged with.
There's no way to know exactly what the future holds, but with an open mind and a focus on delivering experiences that quickly mobilize supporters around causes support, there's no doubt we have a lot to look forward to. I hope these predictions help you take on the new year with a critical lens to identify new ways to elevate your own experience in response to your donors' needs and preferences.
There's so much more ahead.