Nonprofits Expect Fundraising Results to Decline in 2020
Fundraising Down

July 27, 2020 — More than half of all nonprofits nationally forecast a decline in the amount of funds they will raise in 2020, compared to last year, according to a recently completed survey, with local experts saying the fundraising landscape for Massachusetts nonprofits will be tied to what they have done during the crisis.

The survey of 850 fundraisers, conducted in May by the Association of Fundraising Professionals (AFP), which released results this week, found that:

  • 56% believe they will raise less money in 2020, compared to 2019
  • 21% said they anticipate raising more money in 2019, compared to last year
  • 23% reported they expect to raise about the same amount this year as they did last year
  • 64% of respondents said their organization canceled at least one event
  • 51% switched at least one in-person event to a virtual event
  • 74% submitted a grant for funding through the CARES Act, with 66% receiving funding
  • 20% of respondents reported laying off staff, 23% instituted furloughs, and 18% have cut staff pay

The gloom extends to next year, with 72% saying they expect to raise less money in 2021 than they do in a typical year, AFP reported. Only 12% said they anticipate raising more next year.

To reach their 2020 fundraising goals, 48% of charities said they will increase their fundraising activities this year because of the COVID-19 pandemic, while 44% said they are maintaining fundraising efforts at normal levels.

Among those that are increasing their fundraising activities this year, 82% are boosting their donor retention and stewardship activities, according to AFP.

Seventy-eight percent said they are increasing social media outreach. The same numbers said they are increasing reliance on virtual events, as well as boosting their use of online fundraising.

While results were not broken out by state, fundraising pro Robin Cabral, principal of Development Consulting Solutions based in New Bedford, said fundraising success this year and next for Massachusetts nonprofits will likely be tied to whether they have continued to raise funds during the crisis.

For nonprofits that continued to raise funds, some are even ahead of where they were last year at this time, she said. Those who did not continue fundraising have experienced severe losses, in some cases.

"So, to me, it all comes down to whether or not an organization decided to continue to move forward with their fundraising or whether or not they were a group who decided to freeze," Cabral said. "Also, it depends on whether a group is investing more in its fundraising efforts, or deciding to lay off or furlough its key revenue-producing staff."

Sarah Lange, principal and founder of New Era, said that the nonprofits she works with expect their 2020 revenue to drop from last year's level, with many hesitant to solicit funds in the current environment. However, many are engaging in long-range planning

Rita Fuerst Adams, who counsels on charitable and philanthropic management, said some individuals and families are increasing their giving to nonprofits that "have been more vocal, and clearer, about how the pandemic is impacting their work and their need for gifts."

At the same time, business sponsorships have declined with live events either going virtual or being canceled, she said.

"The organizations with the best financial operations at the beginning [of the pandemic] are most probably the organizations with the strongest and most compelling cultures as well," she noted. " The successful organizations have been streamlining operations and pulling administrative functions into central systems. The next step is joining with other programs to expand their services and to serve other market places."

Christina Yoon, vice president of Campbell & Company, reported similar recent experience, recounting that a nonprofit client exceeded its fundraising goal for the year that ended in June, raising more than the year before.

"They also raised a significant amount in major gifts as part of their campaign that is just getting started," she said, noting that solicitations occurred pre-pandemic, but donors did not ask to adjust their pledges.

Other findings from the AFP survey included the following:

  • 64% of respondents said their organization canceled at least one event
  • 51% switched at least one in-person event to a virtual event
  • 74% submitted a grant for funding through the CARES Act, with 66% receiving funding
  • 20% of respondents reported laying off staff, 23% instituted furloughs, and 18% have cut staff pay