The Long-Term View Wins Again

Once again, solid information indicating nonprofits that focused on the long-term during the recent economic crisis came out ahead.

This from Pareto Fundraising who has released the results of their 2010 benchmarking study looking at trends in the Canadian charitable sector. The analysis looks at data through to the end of December 2009 from 14 Canadian charities.

The results were mixed as to how charities in Canada have fared. While income overall fell in 2009, there were certainly some positive signs for the sector, again reinforcing that those organizations that have taken a long term view to growth have come through the financial downtown relatively unscathed and in a strong position heading into and beyond 2010.

The analysis, covering $2.2b of gifts from 4.7m donors, found that:

  • Income from individuals fell in 2009, down 10% to $158m. The key driver of that was a drop in onetime cash gifts donated, which decreased $17m last year (this is due to a decline in the number of cash gifts – the average cash gift actually rose).
  • Monthly giving continues to provide a tremendous stream of ongoing income for charities. At the height of the recession, monthly giving grew 9% in 2009, now providing $48m annually for the 14 organizations involved in the cooperative. Based on the current growth trajectory, monthly giving looks set to overtake cash giving in the next year as the major source of individual funding for Canadian charities.
  • Income from planned gifts increased last year (8%) despite the average value of realized bequests falling from $35k to $32k (though it still remained well above the 2007 level of$27K). This represents a huge area of growth for Canadian organizations. Despite the fact that the number of bequests left each year is on the rise, these levels are still lagging behind other developed fundraising nations.
  • The level of income and number of new cash donors from direct mail fell in 2009 by 15% and 22% respectively. This decrease in income was despite the increase in average gift levels via direct mail overall. This decline in income was offset partly by the shift in focus for many organizations to recruiting monthly donors. The fall in new donors being recruited is both a reflection of less prospecting activity being undertaken overall, as well as a fall in the number of new recruits coming on board.
  • Online giving continues to grow, an increase in income of 17% from 2008. However giving online remains a relatively small chunk of the pie, accounting for just 2% of all individual income versus more traditional means like direct mail which represents closer to 20%.