Managing fundraising through Covid-19 and other crises
Updated: Apr 14, 2020
(We hope everyone is staying safe and helping to save lives by socially distancing!)
CSG has been working with clients through the current C-19 crisis (one of many to hit Hong Kong recently, including the recent widespread protests), and wanted to share our experience with the wider community in the hope it may be of some value.
Covid-19 has brought about never before seen impact to the not-for-profit sector and their beneficiaries. Fundraising has been an early casualty with many charities unsure how they can or will manage through the situation.
We have seen charities having to postpone, then cancel major annual fundraising events. Corporate and major sponsorships have been falling through and we expect Government sources of funds to be tight given the stimulus spending most Governments have had to commit in trying to stabilize the economy. Many charities that rely heavily on these sources of revenue will struggle to make up the loss in the financial year, threatening their projects or even their ongoing viability.
Charities with the backing of Foundations, and those who have diversified into fundraising from the public (so-called Individual Giving), should fare better, experiencing a smaller dip in donation revenue.
Even then, many fundraising initiatives have been cancelled or stopped, especially those acquiring new individual donors from street fundraising teams.
Boards and Senior Management may be tempted to stop fundraising altogether in an effort to save costs and reduce exposure to risks. Whilst it may be pragmatic to pause some activity for a period of time, not all fundraising channels are non-performing. Some initiatives are still delivering results and providing much-needed donations for the charities which take the initiative - and possibly even some risks.
In our experience, the longer the pause in fundraising, the bigger the financial impact on the charity down the track.
How the crisis impacts or relates to your cause could offer an opportunity to fundraise
CSG have had inquiries from Corporate, Institutional and Major donors looking to donate to charities working on the front lines of major crisis and disasters, including COVID-19. As with most emergency or disaster situations, there will be donors who are willing to support on humanitarian grounds, despite the prevailing negative sentiment. This also applies to public/individual donors where we have helped some of our clients to issue emergency appeals to individual donors to support their disaster relief work, raising significant levels of funding for the organisation’s work.
Whilst considered slightly out of fashion when compared to digital platforms, we have successfully utilised direct mail to raise significant sums as well as to acquire new supporters for the charity. More significantly, this less trendy form of fundraising was able to side-step the impact of online disruption most Hong Kong charities were experiencing during the months of protests – direct mail as a means of communication is a personal, one-to-one communication piece, not open to disruption or distraction by other online campaigns.
Having said that, we have found that digital campaigns continue to generate donations from the public, though they may experience lowered efficacy during the crisis period.
Other areas of potential include having data scientists develop an algorithm targeting model to identify donors with highest propensity to support, and developing a bespoke initiative around these identified high potential donors – usually referred to as good donor engagement. Such approaches can even be applied to charities not working on the prevailing crisis or who are just impacted as a result of overriding sentiment.
Consequences of cutting fundraising or stopping for too long
A consistent, observed trend has been that charities which are more willing to adapt, experiment, test and take some risks even through crisis periods have generally gained new understanding on the changed context brought about by the crisis – and be first to market in using those new insights. In this way, the decrease in initial performance can be more than made up for by application of these insights in subsequent initiatives, gaining positioning advantage versus more conservative peer charities. This translates into significant revenue margins when accumulated year on year.
Even when performance may be consistently lower than expected, organisations which persist would likely still net revenue which would otherwise be lost from total inaction. And those who adapt first to the new parameters of operation will likely be in a better position to evolve their financial model and sustain their operation vs those who don’t.
Some additional tips:
- Donors want to continue to feel connected. Think of ways you can engage with them, so they feel like they are still part of a valued group of supporters – part of a community that cares.
- Donors also want to feel empowered – many will have lost control over their day to day lives (when they can leave the house, where they can go), so giving them a tangible call to action – something they can DO that will make them feel good – will be a relief to many.
- While many donors will be impacted financially and temporarily (or indefinitely) unable to give or reluctant to commit at this time, many more will not be impacted or will understand that there are others worse off than them (eg refugees, the homeless, people already dealing with a chronic illness for instance). And there will still be causes they are passionate about that they want to support no matter what. Even if your cause is not obviously directly related to COVID-19 (eg environment, cancer research), people still care about these things and understand that they are still important – they will want to give if they can.
- Calling people to ask them how they are – or to thank them for their gift – is an incredibly powerful way to keep in touch (esp with higher-value donors) at a time when people may be feeling isolated. Having an opportunity to talk to them personally about how your charity is impacted right now is also too good to pass up! You’ll also be able to answer their questions and gauge the situation they find themselves in so you can adjust your asks and engagement activity accordingly.
- Be authentic, direct and honest. If your charity is in crisis, don’t be afraid to say so. Being personal, honest and authentic has never been more important. People will feel like they are a trusted member of your community, and will trust you more in return.
- Related to the point above re trust is making sure you’re very clear with donors about where their money is going. Now more than ever they want to know that they are having an impact – and with so many causes putting out great appeals at the moment with incredibly compelling arguments, being transparent is absolutely key at this time.
- Clients who have paused fundraising are now planning for initiatives in a few months which can help make up for lost revenues. Consider using this time to work on pre-production for coming campaigns or capacity build in preparation for when the crisis ends.
©Rodney Heng. CSG Catalyst for Social Good.