October 8, 2019
The Tax Cuts and Jobs Act (TCJA) has had a dampening effect on charitable contributions, especially from low-to-moderate income donors. Under the TCJA, it’s more advantageous for many taxpayers to take the standard deduction than itemizing deductions as they might have in the past. Claiming the standard deduction means they receive no tax benefit for their donations … if they’re still making them. That’s why it’s important to exploit every potential channel, particularly those online.
Engaging Donors in a Difficult Environment
Early indications are that charitable donations have fallen since the TCJA took effect. This is on top of longer-term trends. Giving USA’s 2018 nonprofit industry report shows that while giving in dollar terms has increased dramatically in the 21st century, the percentage of all households donating between 2000 and 2014 dropped from roughly two-thirds to about 50% of households. After adjusting for inflation, median amounts donated per household have also declined.
So how can your not-for-profit organization increase gift-giving from a potentially dwindling donor base? The key may be to boost revenue online, where many younger donors can be found. Young adults may only be able to make small gifts now, but small gifts can add up. And engaging donors while they’re just starting out in the world enables you to build a long-term relationship.
10 Ways to Attract Donations
Here are 10 ways to boost your online fundraising efforts:
- Go mobile. Donations are increasingly being made through mobile apps. If you don’t offer one, you’re turning money away. Tools such as Google Analytics can tell you where your traffic is coming from, including the percentage from mobile users.
- Be direct. Unfortunately, visits to your website don’t always translate into contributions, no matter how engaging your site is. Make it easy for donors to contribute. For example, feature a large “donate now” button on your site’s home page and in a prominent position on social media pages.
- Support your brand. It takes time and effort to build an identifiable brand. Make sure that the name, logo, image and content on your site — and in other online locations such as social media pages — are in line with your brand. This tells donors that they’re “in the right place” and helps reinforce a connection with your organization.
- Rely on imagery. Many people are more visual than verbal. They like to see what they’re getting, so provide them with a view. If you can use images to explain your mission and programs, and infographics to illustrate the impact of their donations, you may reach more donors.
- Keep it simple, stupid (KISS). Does your website have too much going on? If it does, visitors may not even be able to find your donation form. What about the form or app itself? If they’re hard to navigate, some potential donors will simply abandon ship.
- Don’t be intrusive. Along the same lines as KISS, the less you ask, the better. Typically, donors want to provide as little personal information as possible. Limit entries on your donation form to only the fields you absolutely need.
- Suggest giving amounts upfront. Research indicates that listing several possible giving amounts leads people to donate more than they would otherwise. It can’t hurt to aim high, so start at perhaps $25 and work your way up to $1,000 — or more, depending on your charity and donor base. Just be sure to provide a blank field for donors who prefer to name their own amount.
- Encourage repeat donations. There’s nothing wrong with getting a big one-time donation from a donor. But your organization may do even better over time if it facilitates periodic contributions. You may even offer gifts to donors (see below) who sign up to make monthly donations directly from their bank accounts.
- Stay in touch. New donors don’t just contribute money, they also provide you with a valuable new contact. Don’t squander this opportunity to solidify the relationship. Make it easy for people to opt-in to your digital and paper communications and encourage them to “friend” you on various social media platforms.
- Give swag. Donor gifts shows your appreciation while providing supporters with a branded item that reminds them of your organization every time they pick it up. Providing swag that aligns with your charitable mission reinforces your objectives. For example, if your organization promotes kids’ sports programs, thermal water bottles could be ideal. Of course, the cost of such gifts must fit your nonprofit’s budget.
Other Ideas
Depending on your organization’s scope and targeted donor base, there may be other ways to encourage contributions. Look around at the “competition” for ideas and ask your professional advisors for suggestions.
© 2019