The Changing Face of the Donor – A New Generation

The changing demographics of donors pose continual opportunities, as well as challenges, for nonprofit organizations. In light of the pandemic, many older adults have been rushing to rethink and refresh their estate plans. They’re thinking more strategically about the welfare of our community as a whole and less about simply earmarking gifts to their favorite non-profit organizations, and they are eager for guidance.

Our traditional volunteers and donors, by and large, older adults and retirees, understandably needed to cut back or simply discontinue their service hours. Many probably won't return to us. Just as employers across the country are struggling to find workers, so are nonprofit organizations. We are working quickly to replace longtime volunteers with a combination of staff and younger volunteers who approach this type of work very differently.

How to Engage the Next Generation of Donors

The Pandemic has accelerated our need to appeal to a younger audience. Gone are the days where we can track down new donors by simply relying on our traditional practices. We need to expand our recruitment tactics to appeal to the next generation of donors—millennials.

THE MILLENNIAL PERSPECTIVE

Each new generation of donors has its own perspective and it’s important to take those things into consideration when designing a new donor strategy. It is helpful to be mindful of what millennials have experienced while coming of age. We often think about the technological advances that have been part of their lives since birth, but they also grew up witnessing horrific violence in their personal spaces, such as school shootings and teen suicide. Their generation will also be dealing with worldwide challenges for years to come, such as global warming.

As a result, they are ready to engage in difficult conversations on topics that would previously have been avoided, such as mental health, and they want to make a meaningful difference. They are very willing to give their time and resources, much more so than my generation, the Baby Boomers, which has been the least charitable generation on record. They also like to engage their family and network of friends and colleagues in the charitable causes that are important to them. This opens the door for peer-to-peer fundraising and other forms of engagement which we, as non-profit leaders, should begin considering how to adjust our approach.

We need to begin by understanding and embracing how the younger generations make decisions regarding the use of their time and resources.

According to a national poll, 84% of millennials made at least one financial gift to a non-profit organization in 2020. This statistic offers me much encouragement about the future of non-profits and is something positive upon which we can all begin building.

Social conscience is one of the driving factors behind that percentage. Millennials and younger generations have a strong social conscience, and they prefer to support real change over simply maintaining the status quo. This has real implications for how we plan and talk about the work of our organizations. For example, a millennial may appreciate the need to house and feed the homeless, and they may readily give their time and money to help in a moment of crisis. To keep them connected to that mission, however, they will likely want to know more about the next step. How are you helping those individuals and families achieve long-term stability and how can their donations and continued service help to achieve that goal?

CHARITABLE NETWORKING

The younger generations prefer to blend their charitable service and their social time with friends. This is one of the ways in which they enjoy fulfilling two personal goals simultaneously while using their time efficiently, and it opens the door for non-profit organizations to engage them in peer-to-peer fundraising and recruiting volunteers on your behalf. If you can successfully get a core group of young donors and volunteers on your side, you can rely upon them to bring other people to the table to participate in the activities of your organization together. They also view all of their personal assets, including their time, money, their talents, and their personal networks, as equal and our acknowledgment of those gifts need to reflect that value.

A FAMILY AFFAIR

Social change is extremely important to this generation and it is equally important to instill that into their children. Whenever possible, create activities that are family-friendly and you'll stand a better chance of engaging those young families.

THE SHORT-TERM

Although millennials are invested in social change for the long haul, they are likely to only be personally invested in most projects for a brief period of time. They prefer short-term projects with clear outcomes versus indefinite time and donation commitments. Consequently, they are willing to quickly move from one project to the next and one organization to the next. For example, you'll likely find them unwilling to volunteer for ongoing Meals on Wheels assignments, even if that only requires a commitment to serving one day each week. You’ll find them more inclined to adopt a single week, or even a month, to take charge of filling individual route assignments with their family, friends, and colleagues.

They may also quickly express their interest, but may not fully commit until the last moment, and they have the tendency to either not RSVP, but show up, or to RSVP and not show up. I’m sorry to say, from what I’ve seen, this trend is not going away. So, we all need to hedge our bets in terms of numbers and practice patience.

IF AT FIRST, YOU DON’T SUCCEED

The younger generations are very entrepreneurial and have a high tolerance for trying new things, knowing that that may fail. We can expect them to push us out of our comfort zones. Our default response shouldn't be to immediately push back. We need to embrace the merits of their ideas and give them room to test them while taking our budget and time constraints into consideration.

CHANGE-DRIVEN

Since this generation grew up with the adoption of the Benefit Corporation, socially responsible investing and impact investing, younger generations readily blur the line between for-profit and non-profit sectors.

Their quest for social change flows relatively seamlessly between the sectors. Therefore, whichever sector seems to be doing a better job with innovating and achieving the change that they're looking for is most likely to capture their time and their resources.

Steps that non-profit leaders can begin taking right now

1. Long-time donors
   For our long-time donors and volunteers, we need to be talking to them about planned giving. We also need to have a plan for how estate gifts can transform our organization and community impact. This may mean directing an estate gift to a specific strategic expenditure or simply an endowment for the long-term financial stability of our organization.
   
   
2. Gig Economy
   I recommend that we also begin incorporating elements of the gig economy into our engagement strategy. This may take the form of many short-term, impactful projects that offer us and millennials a series of quick victories. This practice may consume more time and effort but should develop relationships that can stand the test of time.

3. Entrepreneurial Mindset
   We need to adopt a more entrepreneurial mindset to how we fulfill our non-profit missions. This includes a willingness to allow younger volunteers and donors to push us out of our comfort zone. However, don’t be afraid to push back when something pushes beyond your limits.

4. Educate and Engage
   We can't expect donors to be aware of the regulations that we need to follow, as well as the day-to-day realities of struggling families, so we need to help temper their ideas with information.

5. Reimagine Board Service
   The days of expecting our supporters to readily commit to 6 to 8 years of service, in my opinion, are numbered. The future of the nonprofit board has yet to be defined but may take the shape of a much smaller governance structure focused primarily on fulfilling the legal responsibilities of a board. That structure may then be complemented by many short-term, task or project-oriented ad hoc groups populated by non-board members. Those short-term engagements could prove to be a great way to identify and cultivate our future board members.
   
   
6. Embrace Uncertainty
   My final recommendation is to embrace a higher level of uncertainty, which we can keep to a manageable level if we commit to listening to and evolving with each new generation.

Click here to read part two of this series, The Changing Face of the Donor – Donors of Color.

You can watch my full presentation by visiting the Brown Edwards YouTube channel and download additional resources below.

Additional Resources:

The Millennial Impact Report
How to Engage Different Generations of Donors
Engaging the Next Generation of Philanthropists
Engaging the Family in Your Philanthropy
The Boundaries are Blurring between Philanthropy and Business