Donors Remain Faithful during Hard Times

We see it; we feel it; we anguish over it. It's present in our personal lives and among our business and non-profit acquaintances. A monetary storm of rare proportions has dealt our nation's economy—and the charitable sector in particular—a difficult blow. After several months of harsh financial conditions, we have data from Giving USA, the most comprehensive report on US giving patterns, to help us understand how donors are responding and how charities are coping.

Here's a summary of a few key facts from 2008:

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Total giving at $307.65 billion, down 2% (-5.7% adjusted for inflation)

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Individuals (incl. bequests) remain the single most important source: 82% of total giving.

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Three sectors: individuals: -2.7%, bequests:-2.8%, and corporations:-4.5% saw modest declines in giving attributable to the economy.

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Foundation grantmaking rose 3%, the only sector to increase in 2008.

While declines in giving were not surprising, there is some optimistic information buried in the data. Over the years, charitable giving among individuals has roughly tracked upward with the movement of the Dow Jones and S&P 500 averages. In 2008, both of these indicators experienced steep plunges by year end, far exceeding donors' pullback in giving. Knowledgeable donors seem to understand that this is a period of time during which their support is more important than ever. Charities that keep in touch with donors and thank them for their support will be appreciated by those who have dug deeply to sustain their giving in 2008.

Visit: Giving USA | Giving Institute

Letter from Russ Hodge

I'm pleased to introduce The Hodge Group, a new resource for the philanthropic community. As Managing Partner, my vision for The Hodge Group is to provide both a continuation and an expansion of support and expertise that the nonprofit community has come to expect over the years from my involvement as principal of R.L. Hodge & Associates and CEO and Partner in Hodge, Cramer & Associates.

Based on rich experience, The Hodge Group will offer services delivered by some of the most talented individuals in the industry. We will call on our vast inventory of successes from the past 25 years and merge them with the freshest, cutting-edge thinking about philanthropy and consulting in today's unique environment. We will continue our focus on donors and face-to-face contact while adding a new emphasis on social media and volunteer engagement that will help non-profit organizations improve competencies in management, entrepreneurship, and effective fundraising.

In the end, we know that some of the oldest philanthropic traditions are still valid principles... personal contact with donors and ongoing commitment to service. The Hodge Group is Setting the Stage for Giving.

Russ Hodge, CFRE
russhodge@hodge-group.com


Four Ideas for Keeping Donors Attention during the Summer

Stay connected with loyal donors and major gift prospects by planning face-to-face visits. This can be done with much less expense than large mailings of expensive newsletters or brochures and your focus stays where it should be…on loyal donors. The purpose of your visit might be to inform donors how your organization is using creative strategies to weather the economic storm. Be prepared to tell about areas of greatest need whether you are making a cultivation or solicitation call.

Host one or more small group receptions with a facility tour for promising prospects. Take advantage of summer weather to hold the social part of the event outdoors. Choose a Monday or Tuesday late afternoon (tour first then cheese and wine) or choose a weekday 8 a.m. continental breakfast followed by a tour. Limit events to no more than 90 minutes and be sure to have enough staff present to attend personally to all the guests.

Send a postcard to special donors and prospects with your carefully crafted message. The postcard should also be designed to drive recipients to your website where they can find information on a variety of topics from program or campaign updates to planned giving information.

Recruit new volunteers. Most donors are sensitive to the realities of the economy. If you organization can use additional volunteers while staffing is minimized, take the summertime to engage new people or reach out to existing donors for their hands on support. While volunteer activity is not typically a revenue producer, remember that donor volunteers are likely to become more knowledgeable, invested, and engaged with your organization because of offering their time. The next gift will be easier and larger.

Want more great fundraising ideas? Let The Hodge Group help your organization! Contact us here!


Is the Recovery beginning? What should you do to be on top of the wave?

Throughout the past 18 months of economic downturn, little public attention has been paid to the toll that has been taken on the health of non-profit organizations. The US non-profit sector employs 10 percent of the workforce, more than auto and steel industries combined. Since early 2008, revenues to non-profits have fallen as funders – foundations, corporations, and government – have cut back and as individual donors have pared down their charitable support. But, there is a bottom to this slump and we may well have reached it.

Bank stocks leapt and led a broad-based market rally Monday amid bullish analyst comments, new efforts to raise capital, and signs of life in the housing market. Source: The Wall Street Journal, May 19, 2009

Now, as we approach the end of the second quarter of 2009, within the business press and analysts we find signs of hope and predictions of a recovery that is already underway. Investors are slowly gaining confidence and seem willing to get off the sidelines and take more risk. Overseas markets are reflecting the still new but increasing confidence coming from Wall Street and the US financial sector. Housing starts are up and existing home inventories are down. Unemployment figures are not increasing at the same rate as in previous months. Government stimulus funds from the Recovery Act are finding their way into states and communities to produce jobs and spur economic activity.

It is widely expected that the non-profit sector will play an important role in the economic recovery which is now on our doorstep. Assistance with job training and education, health care, emergency shelter, food banks, and many other services to individuals and families make up the non-profit safety net that American have come to rely on. As for the beauty and creativity of the arts, they are what make our lives worth living. As the recovery expands, here are a few things that your organization can do to stay on top of the wave:

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Develop a 'lean-and-mean' but realistic budget and live by it.
Clients, donors and volunteers will not only understand and forgive your economies, but actually expect you to make practical, cost-cutting modifications to your day-to-day operations. Some of these cuts can become long-term cost savers for the organization.

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Explore opportunities for obtaining economic stimulus funds
Organizations are most likely to be successful grant seekers when they look for funds in areas in which they already deliver services. Funds are dedicated to Education and Training, Health Care, Energy, Protecting the Vulnerable and other areas. Check www.Recovery.gov for information about grant opportunities, jobs, and programs in each state.

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Consider hiring a temporary worker
As demands for your services increase, a temporary worker may provide a solution for delivering services without making a long term budget commitment to staffing. Temp hiring in the business community is always one of the early harbingers of an economic recovery. Why not use the same strategy to serve your clients without breaking the budget that is already stretched.

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Focus on legacy commitments rather than major gifts during the downturn
In your regular contacts with donors, an economic downturn is actually a very good time to talk about legacy gifts. After all, you are experiencing the proverbial 'rainy day' right now. It's a great time to make the case for endowment or legacy giving that will ease the financial burdens of the inevitable economic downturn of the future.

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Communicate with your constituents
Communicate with your constituents about how you are weathering the economic downturn and what plans you have to move forward when 'the storm' is over. Be sure to inform them that you are taking advantage of opportunities available through the American Recovery and Reinvestment Act. Explain what economies you have made in your budget. Thank them for their continued faith in the organization and ask them to continue their support, even if they must modify the amount this year.

Let us help you with Board Leadership Training. Contact The Hodge Group.


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