You just gotta love older people

By Sean Triner
On May 29, 2014 At 2:00 pm

Category : Best posts Q2 2014, communication, donors, Latest posts, strategy

Responses : 11 Comments

If you are a fundraiser, you just gotta love older people. Fundraisers, on average are pretty young.  Donors, on average are pretty old.  So we have an interesting gap to overcome in communication these fundraisers and donors.

By old I mean around 70.

One solution is to try and make younger people donate, like older people do. Many charities have a strategy to ‘get younger donors’. This is laudable, and the correct thing to do – after they have got as many older people as donors as they can get.

F2F recruit Year 1 Attrition by age

Not long ago, the best way to get young people to donate was to wait thirty years. This is still mostly the case, with only face to face cracking the trend on a strategic scale, and online giving scratching at the surface. But even x` face to face the older donors are better!

Online giving is beginning to have an impact, with more 50 year olds (ie younger people) giving online every year. Charities like Soi Dog (referenced later) have cracked the social media holy grail and actually got Facebook to work. But overall, online solicitation of donors is still a minor part of all giving.

The chart shows the small number of online regular givers and one off (cash) donors acquired by 60 charities.  These organisations raised over $1bn in Australia in 2013.  Note these charities give a statistically valid sample of total individual regular and one off giving.

New Cash Recruits by year and channel

 

There are three reasons charity staff want young people to give:

1)        they are young fundraisers and it is just how they think

2)        their database is ageing and dying and they are worried about it declining

3)        they are worried that if we don’t get them giving now, they won’t give when they get older

The first has no logic or data based reason to pursue younger people.

The second is relatively good news. Ageing databases give more, 70 year olds in NZ, Australia and UK have still got 15-20 years of giving left.  And they are good bequest prospects.

The third is a constant terror that has been with us for generations. Historically, every single generation gave less than their older peers.  Until they became older and then they gave more! Every time.

So far. Past performance is the best indicator of future performance.  But we can’t be sure that this will be the case in the future so we should be vigilant. We do have some cool, positive indicators though. For example, the millions of 40 year olds now supporting charity through regular gifts solicited on the streets and door to door. Hopefully these guys will be more generous in 2039 than current 65 year olds are right now.

Yes, we do what young people to give – but the responsible fundraiser absolutely must focus first efforts on older people.Exceptions would be using the now proven face to face, R&D or in some cases, a unique position.

One example of this unique position is the afore mentioned Soi Dog.  Soi Dog is a Thai charity that fundraises internationally. Soi Dog simply can’t market locally like US, UK or Aussie based charities so they have to fundraise online.  And they are bloody good at it.  Better, in fact, than any Kiwi or Aussie charity at acquiring donors through Facebook. But Soi Dog raise less money through their brilliant, world beating global online fundraising than the Lost Dogs’ Home does through direct mail and bequests in one state of Australia. Soi Dog and the Lost Dogs’ Home do essentially the same thing in Phuket and Melbourne respectively.

I will be blunt here: in strategic volumes:

  • older people are usually less expensive to get a first gift in the first place
  • older people are much more likely to give a second gift
  • older people are less likely to cancel regular gifts
  • older people give more
  • younger people are less likely to die and leave a bequest within a budgetable time period

The income in the chart is the average household personal income for people at that age.

Average income and gift amounts

This is not to suggest you shouldn’t ‘do online’ – an area usually associated with younger donors. Although online solicited donations are still not strategically significant as an average across charities in Australia and NZ, there are a few charities who are doing very well.

And guess what – the older donors picked up online will be better than the younger ones!

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Sean Triner (5 blogs on 101fundraising)

In 2002, Sean moved to Australia and joined forces with Australian data-expert, Paul Roberts, to form Pareto Fundraising. Their ambition was to apply what they had learned from years of pushing the boundaries in the UK to help Australia’s best charities increase their income and donor bases beyond their dreams. Challenging, fun and always practical, Sean is an energetic speaker who leaves conference, seminar and Masterclass attendees inspired, motivated and buzzing with brilliant ideas about how to take their fundraising to the next level. Sean is also a ‘trained’(!) stand up comedian, deadly snake rescuer and story teller. Useful skills for presenting and article writing.


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Comments

  1. Love your tongue in cheek tone here, Sean! We’ve been doing a lot of research on the impact Millenials will have in the fundraising marketplace as they age, and the common trend that we’ve been seeing is that this age group (seemingly more than any other before it) wants a personal connection as motivation to give. We’re coming to a place in fundraising where we’ll have to revamp the way things have always been done, don’t you think?

     — Reply
    • Hi Heather
      Thank you for the feedback.
      I am not sure we need to revamp – it just depends if what you are doing is good. Personalised, relevant, story driven direct mail which follows best practice (long letter, great illustrative case study, no statistics, personalised ask amounts, appropriate thanking, good and clear proposition, deadline etc) doesn’t need revamping.
      This is how I think we achieve a ‘personal connection’. Finding donors who have a an actual physical personal connection (eg relative with Cystic Fibrosis) is too restrictive.
      Sean

       — Reply
  2. Hi Heather
    Thanks for the feedback! I think that may well be the case in what Millenials say, but what people say is often not matched with their behaviour – best measured through transactions.
    At the moment, it is hard to measure Millenials’ donations because they don’t really donate in a big way. As current older people didn’t when they were their age.
    We have to be practical about priorities which haven’t really changed much (young = fun, dating, peer pressure, travel, drink, party etc: old not those things) and disposable income (young = not much).
    Sean

     — Reply
  3. Thank you for this excellent information and advice, Sean.

    As fundraisers, we should always be pragmatic about our approach and not make decisions when developing fundraising programs based on feelings alone.

    I see this as nothing but opportunity – continue to focus on the group that is giving the most, and will continue to do so over the next decade or two, and build channels to engage younger donors who will eventually have shifting priorities, including increasd charitable giving. Just don’t expect them to give at levels beyond their means or psyche right now.

    I think the main win with younger donors is their ability and inclination to share with others using technology – this can help get the message of giving to your organization out to a larger audience.

     — Reply
  4. Fascinating how culture can influence fundraising methods and success. While the importance of face-to-face e.g. in Germany has been growing over the last two decades, too, direct mail is still very important, even for recurring donors. Interesting that the online-channel does not play a bigger role yet. Working in an online-based campaigning organisation in Germany, I recommend: it’s worth going for! People use the internet to explore non-profits – as they are willing to donate online – when we prove that we are trustworthy. We recruited 80 % of our 22,000 regular donors online (average age: 57) …

     — Reply
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  6. Excellent, Sean. So glad to hear that us “older people” are valued – even by you “younger people!”

    And congrats that The Agitator picked this up and focused on you and your article in its 06-03-14 blog. Yippee!

    And, Heather… I don’t think the “personal connection” desire is a revamp at all. Building loyalty is about relationship building – which is about personal connection.

    It is definitely time to focus on personal face-to-face solicitation (not street fundraising) in the North American sense of the phrase: Meet with the person face-to-face and solicit. This is a personal meeting between people who are connected, know each other. (I rarely say anything positive about the U.S. Lots of positive about Canada and elsewhere!). I believe all nonprofits should do personal face-to-face solicitation for larger gifts (whatever the donor considers large – and what’s good ROI for the organization) for annual support every single year. As a chief development officer, my institution conducted 500 individual and corporate asks each year, using board members and other caring volunteers. And the institution whose board I currently chair conducts dozens of personal face-to-face asks each year with donors asking for operating gifts. Talk about personal connection!

    Thanks Sean. Off to client work.

     — Reply
    • Hi Simone
      Good points, and thank you for the feedback. Face to face (as in meeting key donors) is definitely the most effective method of fundraising but is difficult to scale up, hard to find the right people to do the asking and expensive. Estimates from my clients are around $500-$700 per ask.
      So, of course, we apply the Pareto principle – 80% of donations come from 20% of donors. But for many charities, that is still too many people to visit personally.
      However, a little quirk of maths shows that Pareto squared also applies (on a large database, or over ten years). By this I mean that of the top 20% of donors, the top 20% of them give 80% of the top income. In other words, 20% of 20% of donors (4%) in theory, give 80% of 80% of income (64%).
      If, in theory, you visit these people and double the money they are giving from face to face, you end up with 128% of the donations.
      So, yes! Visit!

       — Reply
  7. Thank you for this blog post, Sean. The pursuit of the young donor is a constant topic at the US, faith-based, international development nonprofit where I work so this discussion is applicable. I had a question on the last chart that you shared. Can you give a little more background on the source of that data? Also, is it average income and gift amounts in Australia and NZ for charities based in those countries? And then I would assume the $ would be Aussie Dollars? If so, how applicable do you think that chart would be for us in the US working within the US marketplace? Thank you!

     — Reply
    • Hi
      No worries.
      It is Aussie dollars. One Aussie dollar is about one US dollar.
      The chart is almost certainly applicable for US, UK, Canada, Ireland, France, Germany, Belgium…. but to know for sure I would need to do the analysis there.
      The big difference between Aussie/Europe/Canada versus the USA is the success of face to face (regular giving solicitation on the streets & doorknocking) in Aus/Europe/Canada.

       — Reply
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