Recommendations for Philanthropy in the COVID-19-Affected Economy
The coronavirus (COVID-19) and its widespread impact continues to be the subject of intense interest, extending into the economic and philanthropic markets. We have diligently tracked the economy and philanthropy for the past 50 years and witnessed the steady increase in philanthropy in every year barring few exceptions.
This economic situation differs from those of previous economic downturns in that it is driven by health concerns over the spread of the coronavirus. Yet the end results are similar. We are faced with unique marketplace realities that have resulted in a loss of money and a loss of confidence in the ability of international production of marketable goods – and the cascade that follows. A level of discomfort permeates among organizations’ key constituents including staff, volunteers, board members, donors, and prospects.
The playing field, however, is the same as it was before. Every organization in the nonprofit arena is met with an equivalent landscape and there will be some economic Darwinism at work. Those that compete the best and with the most assertiveness will find the most success.
Compass’ recommendations for times such as this include:
Refining and Reiterating the Case for Giving
- Do not ignore the economy and the pandemic conversations. This year, donors will understand organizational challenges. Include in your narrative that you are taking measures to ensure their dollars are spent wisely.
- Be worthy, not needy. Demonstrate that while being prudent in preparation for a year that is very uncertain, you are staying the course because of the importance of your mission.
- Do not panic. Every other nonprofit organization is navigating the same issues. Crisis fundraising is rarely successful.
- Appeal to emotion. Even in tough economic times, gifts are generated from the “heart” and justified by the “head”. There is a societal need for what you do and a result that benefits the entire community. Your mission is worthy and has value so do not be shy. Being fiscally responsible strengthens that message.
Focusing on Annual Fund Appeals
- The Annual Fund is not about big plans for expansion or acquisition, it is about today. Keep focused on the basic mission and operation of your organization and how your donors can help.
- Focus on executing the basics well. Your environment is much more competitive, so focus on doing the right things and doing them as professionally as possible.
- Stay within your philanthropic culture. Do not be too fancy or too austere–just be you.
- Continue with your regular cadence of annual fund appeals. Your donors are used to it and will expect it, no matter the economic climate.
- Put your immediate needs out front right now. Adhere to your institutional integrity and understand that the economy might have an impact.
- Plan for slower returns and, possibly smaller gifts. Many are predicting that annual funds may not take a big hit because they are based on discretionary income and not appreciated assets.
- Ask. Action in the marketplace is infinitely better than inaction in times like these.
- Engage some of your loyal major donors to create a challenge to inspire others to give.
- Stress participation – keep your donors close and involved as much as possible while respecting travel regulations and social distancing mandates.
Continuing Capital Campaign Planning
- While the economy and current climate has a huge impact on the psychological state of your donors, your organization still has needs and plans. You must continue with your planning–and with the implementation of those plans. Stagnation is damaging and difficult to overcome.
- Spend time reviewing your prospect pool. Identify potential prospects, conduct prospect research, and identify influential relationships to ensure your pipeline is sufficient for future success.
- Cultivate your prospect pool and current donors. This is an ideal time to keep them close, get them involved, and let them know how important they are to you.
- Refine your message and build an urgent and compelling case for support. Spend time instilling confidence in your volunteers and ensuring they are speaking with the same voice.
- Train your solicitation teams. Use this time to prepare your volunteers for handling major gift asks in this environment.
- Be prudent, be cautious, and continue to move forward.
- Continue to cultivate and involve your best supporters. Some organizations will forego talking to their best donors in tough times–and this may be especially tempting given the current interaction limitations – do not make that mistake.
Soliciting for A Capital Campaign
- Acknowledge that your campaign may take longer, gifts may be smaller, in-person visits will be fewer, and fundraising may be harder.
- Assess your campaign timeline. You may need to adjust plans and timelines to account for solicitations that may take longer and volunteers more reluctant to solicit in times of discomfort.
- Strive to increase your prospect pool and re-validate your ask amounts.
- Train your solicitation teams to be more empathetic and flexible with their prospects and to continue to connect with prospects despite travel restrictions limiting in-person visits.
- Create opportunities to build stronger relationships with your prospects through phone and video calls, personalized notes, and additional means of connection during a time of mandated social distancing.
- Continue to ask.
- Utilize “Letters of Intent” for those prospects who feel uncomfortable about pledging over a 5-year pledge period.
- In a difficult solicitation, consider receiving 20 percent of your proposed ask amount now–this year–and asking to come back next year for a four-year pledge.
- Maintain your team. Your main job during times like this is to keep people working. It may not be along the original plan (everyone may need new campaign plans, timetables, and visitation metrics) but they need to know that there is a strategy in place.
- Be patient, be persistent, and be respectful to your prospects and donors.
- Remember that those donors with whom strong, confident relationships exist will continue to support you even in difficult times.
- Invest in those donors who understand and see their value to you as they will continue to give. Those donors who have experienced your productivity and understand your “value add” will not only stay with you, but will also set a leadership example for others to follow.
About The Compass Group
The Compass Group headquartered in Alexandria, VA, provides strategy, education, and coaching to organizations that must be successful in fundraising. In a working partnership with your staff, volunteers, and board, Compass will help you to enhance and develop the philanthropic culture of your nonprofit organization and achieve fundraising success. Our specialty areas include Arts & Culture, Environmental, Health Care, Higher Education, Human Services, and Independent Schools.
About Frank Pisch
Frank Pisch is founder of The Compass Group, advancing the mission of hundreds of organizations through capital campaigns, major gift fundraising, strategic planning, and fundraising counsel. In his more than 40-year career, Frank has secured more than $4 billion in philanthropic gifts for diverse organizations including colleges and universities, independent schools, hospitals and medical centers, human service and environmental agencies, youth groups, arts organizations, and trade associations.
Frank is an Industry Advisory Council Member for the Council for the Advancement and Support of Education (CASE); a Certified Board Consultant through BoardSource; and a frequent presenter at national conferences including CASE, the Association of Fundraising Professionals (AFP), and the Association of Governing Boards of Universities and Colleges (AGB).
Frank holds a Master of Arts degree in Organization and Management from Antioch New England Graduate School and a Bachelor of Arts degree from the University of Connecticut School of Education.