How to Cope with the Struggling Economy by Embracing Trends within the Nonprofit Sector

Despite some recent positive signs, it’s no secret that the economy is still in bad shape.  It’s also no secret that the current economic recession has taken its toll on charitable foundations and nonprofit organizations.  The purpose of this post is to share with you some recent trends in the nonprofit sector that may represent valuable opportunities which could help your organization avoid feeling the effects of the recession.

Social Networking

Everyone is talking about it—but how can nonprofits make use of social networking in carrying out their charitable purpose?  Here’s one example.  A new video sharing site launched this month, called World Flix, is using the power of online video to bring personal messages from places like Uganda and Haiti directly to the laptops of prospective donors.   Donors can browse video messages, viewing messages and making donations in just a few clicks.  World Flix’s founder, Laika Grant Mann , is excited about the prospect of using online video sharing as a fundraising tool.  As Mann told the San Jose Mercury News, “[…]by bringing together video clips, grassroots organizations and online donor pools, World Flix can be the means to changing the world through micro grants one video clip at a time.”

So which social networking tools should you use?   The answer depends largely on your organization’s mission.  If your message contains strong visual components, online video sharing sites such as YouTube would make be a good fit.  If you are concerned with expanding your range of contacts, consider using Facebook or LinkedIn.  If your organization wants to provide regular updates to others, a blog or a Twitter account would help you achieve this.

Which tools are members of the nonprofit community currently using?  The nonprofit resource group, idealist.org, recently published results from its survey of idealist.org users’ social media habits.  The survey found that 27% of respondents were on Twitter, and 21% were on MySpace.  55% of respondents actively post to these networks, compared with 44% who were passive observers.  Between 51% and 48% of respondents indicated that they read blogs.

Cause Related Marketing

Chances are, if you don’t own a Livestrong® bracelet or a (RED)™ branded product, you know someone who does.  Cause related marketing continues to grow in popularity and is showing no signs of slowing down.  According to a report from IEG, a company specializing in sponsorships, North American companies are expected to spend a total of $1.55 billion on cause-related partnerships in 2009.  This amount represents a 2.2 percent increase from 2008.

In the current recession, cause related marketing could be especially beneficial to basic need charities.  According to a recent article in the Philanthropy Journal, basic need charities such as Share our Strength, an anti-hunger group, have had particular success with cause marketing.  Share our Strength has seen its cause-related revenue jump 15 percent through partnerships with companies such as AT&T and Hickory Farms.

Cause related marketing is a great way to boost your organization’s revenue by reaching out to charitable consumers in a way that resonates with them.  How can your organization take advantage of cause related marketing?  You can start by taking a look at the Foundation Center’s introduction to cause related marketing, which is full of valuable information and resources.

Micro Giving

When it comes to fundraising, many nonprofits tend to “think big,” pursuing large grants from private foundations and governments.  Recently, however, there’s been a trend toward “thinking small.”  This small-scale “micro giving” takes a couple of forms.

First, many nonprofits are forging strategic partnerships with retailers that allow the retailer’s customers to make very small donations to the nonprofit in a convenient manner.  For example, Petco, the large pet supply chain, created a program that encouraged customers are able to “round up” their purchase to the nearest whole dollar.   All proceeds from the program went to local spay/neuter focused animal welfare organizations.

Other nonprofits are partnering with social networks such as Facebook that enable users of the social networks to make small donations online to a charity of their choice.  Facebook allows users to give online “gifts” to one another, with the majority of the nominal fee, often around $1.00, going to the selected charity.

Although a July 14 info graphic in the Economist observed the good news that charitable giving among wealthy individuals has not been hurt by the recession, if your organization is like most organizations, not all of your donors are wealthy.  Micro giving provides an extraordinary tool for reaching out to these donors where giving is convenient and affordable to them.

Conclusion

Despite the tough economic times, it is clear that there are still a variety of opportunities for your organization to generate more revenue and expand your capacity.  Which of these trends holds the most opportunity for your organization?  The answer depends on many factors, including your organization’s needs, goals, and expertise.  As always, we are happy to consult with you about any questions you might have.

Advertisements

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: