Gen X and Millennials are set to inherit $30 trillion over the coming decades.
The wealth transfer coincides with a rapid shift from traditional forms of giving (direct mail and physical checks) toward online and mobile experiences, and top charities are looking to tap it. Since this demographic represents the first population of true digital natives, their behaviors are increasingly out-of-sync with existing fundraising infrastructures comprised of clunky online registrations, donation forms, and mail-order appeals.
A “subscription economy”
This generation has fueled the rise of the subscription economy and a wave of consumer conveniences ranging from one-click purchases (Amazon), micro-investments (Acorns) to peer-to-peer payments (Venmo and Zelle). Adaptations of online philanthropy will require similar solutions and experiences that are contextual to the industry and also meaningful to the modern donor.
Nonprofits looking to engage donors in today’s world should be building and implementing strategies to meet these trends, before falling too far behind. But don’t fret, there are plenty of opportunities out there to get started in this effort.
A micro-recurring model
Nonprofits leverage innovative tools like American Cancer Society’s spare change donations to engage and cultivate their communities in a fresh yet familiar way. The micro-recurring giving model allows donors to link a card directly to a nonprofit cause, then automatically round up and donate the spare change on their purchases to the nearest dollar.
With an average gift of $20/month per donor and over 90% monthly retention, it only takes 100 spare change donors to raise up to $20,000 per year. Its innovation contains all the benefits of a recurring model, but with a lower barrier to entry. The psychology of the “spare change” gift also satisfies the Gen X and Millennial preference for longer-term involvement in creating social change without the fixed commitment of a traditional monthly donation.
The ‘Change to Spare’ campaign by American Cancer Society launched over National Survivors Day weekend. To kick off the campaign, ACS is activating a few hundred Millennial women on Instagram to share stories and make lifestyle commitments to invest their spare change toward a future without cancer.
Spare change can be a powerful micro-recurring model for nonprofits of all sizes. Small, local organizations are raising thousands of dollars by enrolling board members, staff, and volunteers to start. Making micro-giving a part of the team’s culture drives growth through direct word-of-mouth which in turn, organically extends to family, friends, and the broader donor community.
Some nonprofits believe in the concept so much, they’ve opted for their own fully branded mobile apps to leverage a rich-media news feed and push notifications. These features delight donors with updates about their impact and provide a hub for volunteers and members to receive communications straight to their mobile devices.
The landscape shift
Today, virtually every desire can be fulfilled on demand from our mobile devices in just a couple of short keystrokes. While this may appear to fuel a culture of instant gratification and social meritocracy in younger generations, it also presents upsides when observing how the ‘better angels of our nature’ behave online.
In the face of crippling student loan debt, stagnant salaries, and increased costs of living, the average Millennial gave $580 to charity in 2018. According to social fundraising data, Millennials and Gen X made up nearly 50% of all GoFundMe donors in 2017 and 82% of Millennials reported giving to a nonprofit in the previous year. Despite having less to give than previous generations, their donations create real impact en masse, especially considering that each social share raises $15 on average.
In our hyper-connected world, ideas and movements spread and flourish with astonishing force and speed. The most notable examples include the #MeToo Movement, March for our Lives and the unprecedented outpouring of generosity for victims in the wake of Hurricanes Harvey, Irma and Maria.
Nonprofits like American Cancer Society refocused on providing mobile-forward experiences to capture the support of younger donors who believe in their cause. Does it meet the high standards of mobile natives?
For other non-profits, are they providing meaningful follow up and tools for social engagement? If not, now is the time to transition to a donation process that includes these modern frameworks.