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Nonprofits are facing record inflation, workforce shortages, a potential recession, declining donations, increased demand for services and more. They hardly have time to keep up with the latest trends in the sector. That’s why NonProfit PRO has continued its annual tradition of asking prominent thought leaders in the sector to make nonprofit trend predictions.
We sought out experts from nonprofit organizations, agencies and technology providers to learn what’s on their minds and what might be 2023’s top nonprofit trends across eight categories. Here’s a preview sneak peek at eight of the 40 nonprofit trends of 2023 they shared with us.
1. Will There Be a Recession?
“The big question on everyone’s mind is whether or not there will be an economic recession in 2023 and what will that mean for fundraising. Discerning the answer is complicated by the mixed messages sent by financial data.
“Average wages increased 4.5% in 2022 but did not keep pace with the 6.5% inflation rate. The stock market lost 19% in 2022 but then started the first month of the new year with a 6% gain. The U.S. economy has 2.5 million more jobs than before the start of the pandemic, but six million people are still looking for work.
“Nonprofits should respond by creating at least three scenarios — no recession, mild recession, and recession — and then devise a fundraising strategy for each scenario. Remember: Charitable giving declines by an average of just 0.5% (after inflation) during a recession. However, nonprofits should err on the side of caution. Better to be wrong and raise more money than expected then to be overly optimistic and become insolvent.”
— Bill Stanczykiewicz, Ed.D., senior assistant dean for external relations and director of The Fund Raising School at Indiana University Lilly Family School of Philanthropy
2. Improving Gift Attribution
“Many organizations still operate digital fundraising programs at a level far below their potential, not because of a lack of ideas or interest in being successful but because of fundamental misunderstandings about their digital data. Mystification about gift attribution in a multichannel environment slows decision making or leads decision-makers to faulty conclusions, so focus on tracking “good enough” metrics that are repeatable campaign to campaign rather than holding out for perfect attribution and tracking tools.
“And too often, audience targeting is deferred to outside experts or to the digital platform itself, disregarding in-house marketing expertise and analytics that typically know more. Remember, a digital audience is one independent and critical piece of any campaign, and it can be targeted in a platform-agnostic way.”
— Cameron Popp, director of solutions and innovation at Wiland
3. Pandemic-Era Donor Retention
“During the pandemic, many nonprofits saw both an increase in donor acquisition and an increase in average gift among their existing donors. For whatever reason, these donors decided to give and to give generously.
“As donor acquisition falls off, successful nonprofits will engage this section of their donor file in a way that drives lifetime value while maintaining year-over-year retention rates. Prediction: There will be nonprofit winners and losers here, but action is required now.”
— Dan Reed, CFRE, senior director of digital fundraising at Media Cause
4. Board Expansion
“In such an ongoing and crowded marketplace for the social sector, boards will need to become more and more sophisticated to help govern nonprofits through the myriad of challenges they face. This year and onward, we may see many organizations seek out more board members with diverse skill sets. For instance, nonprofit board members may increasingly have backgrounds in areas like business, legal, technology, digital marketing and more.”
— Stacey D. Stewart, CEO at Mothers Against Drunk Driving (MADD)
5. Tell a Story
“Donors today, particularly millennials, are more likely to give if they can see how their donation is making an impact. They want to relate to your cause and will be more likely to give if they can see how doing so will make a difference for a group they care about. Millennials are less committed to specific organizations, and more committed to the causes they care about.
“This means your ask shouldn’t focus on you, it should focus on the lives of the people you’re helping. Plus, stories translate well to social media. Younger donors are more likely to get involved if they see your message reinforced by their peers.”
— Mike Geiger, MBA, CPA, president and CEO for Association of Fundraising Professionals
6. Celebrating Everyday Philanthropists
“Historically, we have seen high-net-worth philanthropists receive recognition for their major gifts to nonprofit organizations across various news platforms and social media. However, out of the nearly $160 billion in donations from individuals contributed in 2021, only 5% can be attributed to that donor cohort. This means that the majority of donations made were from everyday individuals, who should also be considered philanthropists.
“These everyday philanthropists have consistently provided the majority of funds to nonprofits over the last several years, and that trend is only expected to continue. And, because of this, we will see more and more nonprofits publicly celebrate those donors (if they so choose) and their gifts (regardless of their size) as well as engage with them in real-time — whether it be through social media or even their websites — in the next year and those to come.
“By acknowledging these contributions and showing the impact they are having on causes, nonprofits will be able to further engage everyday donors and ultimately create a steady funnel of donations that will enable them to sustain their work over time.”
— Dr. Keith Leaphart, founder of Philanthropi and board chair for The Lenfest Foundation
7. Diversity, Equity, and Inclusion Work Continues
“It’s time to put action against our DEI strategies. We must become aware of what informs our choices and align those choices with DEI goals that are important to us ….
“Specifically, this means we need to recognize choice points and how to have informed conversations about them. And we must innovate, test, and report on our findings from using DEI-informed techniques, such as adjusting the reading level of our materials, working to engage more impacted communities in outreach, or testing urgency in an appeal.”
— Jackie Biancolli Libby, senior vice president and director of client service at Avalon
8. Message Personalization and Digitalization
“Donors appreciate when their giving history and preferences are recognized. With only so many hours in a day and large-dollar donations on the decline, it’s important for fundraisers to be supported with technologies that they can utilize to personalize communications to better secure funding, relay mission impact, and gain supporters.
“Using your organizational data, you can segment different audiences, understand their motivations, and deliver relevant communications that connect donors to your cause. Artificial intelligence and machine learning can be applied to your data to precisely identify target audiences and deliver messaging and engagement opportunities that best align with their areas of interest.
“The more organizations [that] utilize these technologies, the more intelligent the predictive outputs will be. There are several different digital fundraising tools to explore that support donor management, prospect research, and stewardship, which means less time spent managing donor portfolios and more time connecting with supporters.”
— Allyson Fryhoff, Managing Director of Nonprofits and Nonprofit Healthcare at Amazon Web Services
For more trends from our thought leaders, download NonProfit PRO’s free resource, “40 Nonprofit Trends for 2023.”
Missed last year’s trends? Download “40 Nonprofit Trends for 2022” as well.Return to Insights & Events