How Are Recurring Donors Doing in This Economy?

You may know that I used to work at an international nonprofit, where we focused on monthly giving in some seven countries. The number of recurring donors, or committed givers as they call it in the U.K., was the largest.

That’s why, to this very day, I still like looking at trends in other countries, like Australia, Canada, and the U.K., as they are great indicators of what we may expect to see here in the very near future.

I know everybody is especially anxious to see what’s happening with the second quarter of 2022 results, especially because of the war in Ukraine, higher gas prices, and higher food prices.

You’ve probably read my updates based upon the Enthuse reports before. This time I looked at Wood for Trees, which published the “State of the Sector Report 2022 (January-June).”

It’s based upon the raw data from donor databases from various nonprofits in the U.K. that are fed into Wood for Trees’ Insight Hub.

Here are a few highlights:

1. One-time gifts are noticeably down, although they’re still above 2019 levels.
2. Regular giving had been rising again, especially because of the return of canvassing. However, now attrition rates are rising (and thus retention rates are going down).
3. Levels of giving are still higher than before the pandemic and people are still giving where they can.

When I look at the trends for recurring giving, overall, the income for regular giving from the charities participating in this study is ahead 5% compared to the first six months in 2021. However, while the first five months were still ahead, there was a drop in June 2022, as the cost-of-living increase had a bigger impact.

The attrition rate for regular giving donors is now up to 30% for the year (was 22% in 2021), which means retention is now down to 70%. It’s important to realize that in the U.K. this is largely due to the increased number of new recurring donors generated by canvassing/face-to-face fundraising. However, there are early signs that drop-off was spiking due to the economy.

I am not discouraged at all by this, and I hope you aren’t either!

Remember, in a down economy, recurring gifts may be the best way for donors to continue their support as they can afford smaller gifts. Donors want to continue to help. The more you do to let them know this is an option, the more donors will consider it. And the more you tell them how their gifts are making a difference, the less likely they will stop their recurring gifts.

Of course, that’s only possible if you can communicate with your donors. In the U.K., with its GDPR privacy guidelines, consent is key. The percentage of supporters giving consent for email, phone and text communications are all up compared to 2021, with mail remaining steady at about 50%.

I’ll be on the lookout for other trends here in the U.S. M&R Benchmarks and Blackbaud’s donorcentrics Sustainer Benchmarking are only looking at full years, but Integral and donor database vendors are running reports on a more regular basis, so stay tuned.

First published on Nonprofit Pro on September 29, 2022.