Five fundraising priorities during the cost of living crisis

By Andrew Barton

I started my fundraising career in 2005 and this feels like the toughest environment that I’ve experienced. Inflation is driving up charities’ costs and the real value of giving – not least regular giving – is decreasing.

My feeling reflects surveys of how the UK public is feeling. For example, the latest PwC consumer sentiment survey (October 2022) recorded the most negative consumer sentiment score since the collapse of Lehman’s in 2008.

Let’s face it, the news seems to be relentlessly depressing. Government instability has been at a post-war high and there have been a series of shocks to our personal finances, not least those soaring energy bills.

But sentiment and reality aren’t always the same thing. For example, the PwC survey showed that the highest negative consumer sentiment scores were among the 55-64s and over 65s, yet these groups said they had more money left over for luxuries at the end of the month than the 35-54s!

One thing’s for sure: the impact of the cost of living crisis varies hugely. Yes, most of us have turned the heating down or not even switched it on yet, but for some families, the unpaid bills are mounting and they don’t know how they are going to afford the absolute essentials of life.

What about giving intentions?

There have been some excellent recent surveys of charitable giving by Britain Thinks and Open Fundraising. There’s no doubt that some donors have cut back their giving or definitely intend to. Britain Thinks reckoned that 19% of their sample had already cancelled or would definitely cancel charitable donations. Open Fundraising’s survey showed that 33% of their sample was less likely than usual to sign up to a direct debit and 19% were less likely than usual to make a one-off gift.

That survey evidence is confirmed by actual results: whether that’s increased cost of recruiting new givers or lower average amounts being raised by participants in Facebook fundraising challenges.

We can end up thinking that everything’s going down the pan and getting into a spiral of depression.

But on a positive note, remember the £180billion of increased savings that UK households set aside during the lockdowns of 2020 and 2021? It hasn’t all been spent on cruise holidays (although I have come across some people who seem to be making up for lost time on all those foreign holidays they missed!). The latest Bank of England data shows that household savings are back up. Some of that is precautionary saving for a rainy day that feels like it’s coming soon, but some of it can be tapped into if we fundraisers can make an urgent case for giving that will actually enhance donors’ wellbeing.

How might fundraisers respond?

First: create a sense of realism about the current situation within the organisation. Be honest with Trustees and staff. It is a tough environment. Returns on fundraising will dip. But equally, let everyone know that there are things that we can do.

Set realistic targets for the team. For example, recognise that the number of applications going into Trusts and Foundations is going up and up, so it’s sensible to plan for a drop in the percentage of positive responses.

Second: double down on supporter engagement. Tell compelling stories that help the supporter see how they can help. Tell compelling stories that demonstrate the difference that supporters have made and can continue to make. Tell compelling stories that make the supporters feel connected and special. Be authentic.

Don’t forget the personal touch: give your supporters a call. Invite them to a stewardship event. Make events easy to access – keep up the online opportunities to connect.

Put yourself in the supporters’ shoes. Recognise that they might be feeling the cost of living crisis themselves. Give them options (there’s nothing like a bit of autonomy for enhanced wellbeing). For example, let regular givers know that there are options to take a giving holiday or to reduce their regular gift. And create a sense of supporters’ being in it together: ask your regular givers to consider an increase in their gift at a time when others are having to cut back.

Listen to your major donors. Check in on them. How is the cost of living crisis affecting them? Maybe they have a business that’s struggling and now is not the time to give. But maybe they feel that they can help their favourite cause when things are so tough.

Third: ask supporters to consider ways of helping that won’t cost them right now. For example, it’s a great opportunity to check whether you are claiming gift aid on all donations.

Now is a great time to get supporters thinking about making a legacy pledge, especially if you can tell stories of other supporters who have made a legacy pledge when they’ve had to reduce their current giving. In other words, make legacy giving feel like the normal thing to do for “people just like me”.

Fourth: be realistic about investment in recruiting new supporters. Make sure you are on top of all the factors that drive return on investment. Take a leaf out of the best sports teams’ books: it’s all about making marginal gains across lots of different elements (or at least minimising marginal losses). For example, if you are involved in Facebook Fundraising Challenges, make sure you are totally focused on engaging the event community once they’ve signed up to fundraise. Keep them motivated and connected to the cause.

And finally, look after yourself and your team. Stay positive. And celebrate every success that comes from your efforts.

Keep going when it feels tough out there.