‘Things will get worse before they get better’

The latest Fundraising Futures Report is bittersweet for charities

A new report looking at the state of fundraising in a COVID-19 world suggests things will get worse before they get better, but there is still cause for optimism.

The Fundraising Futures Report, commissioned by peak body Fundraising Institute Australia, found that 61 per cent of fundraisers reported better than expected income performance in the months since March. 

But the impact of physical distancing on a sector that relies heavily on events has been enormous – with an overall decline of 72 per cent in events income since the start of the pandemic. 

The situation is expected to worsen with fundraisers being warned to plan for a decrease in income of at least 15 per cent in the next year – this could be even greater for smaller organisations. 

Those responding to the survey also believe the downturn will be longer than initially thought, with 64 per cent saying they expect the recovery to take two years or more – up from 43 per cent in March.

Yet in spite of this, fundraisers were found to be feeling considerably more optimistic in July than in March – only 36 per cent expressed pessimism while 42 per cent gave an optimistic response, compared to three quarters of people who cited feeling pessimistic in March and only 7 per cent who were optimistic.

Katherine Raskob, FIA CEO, told Pro Bono News that when they started the benchmarking with More Strategic in March things looked really dire and the expectation was that it was going to get worse. 

“So on the one hand it is a little bit more optimistic in the sense that things didn’t pan out quite as badly as fundraisers might have thought back in March, so that is encouraging,” Raskob said.

“But on the other hand we’re looking at a drop of fundraising income of 15 per cent, potentially there will be an even greater impact in the next 18 months as opposed to what we’ve seen in the last six, so bittersweet is a good way to describe it.”

But she said she continued to be surprised at how resilient the sector was and said fundraisers were “a very special breed”.

“Despite a projected decrease in revenue, and more people needing more support – this is going to be a time when ironically budgets might be cut and fundraising revenue might be cut but there are more and more people who need support – fundraisers still have a very optimistic nature and feel a bit of resilience,” she said. 

One of the more positive outcomes to emerge from the report has been a rise in support-centricity with 73 per cent of organisations reporting increased communication and connection to their supporters. Something Raskob encouraged organisations to continue into the future.

The crisis has also prompted an acceleration of the digital revolution, with most organisations forced into a rapid shift towards digital fundraising and communications. 

Looking ahead, one of the big challenges for the sector will be the end of JobKeeper, with the report finding 75 per cent of respondents are reliant on it. 

The sector is also facing a “talent-led recovery conundrum”. 

At the same time fundraisers are expected to deliver in new areas of digital fundraising and innovation – which require greater risk and new skills – training has been reduced and external support is expected to decrease. As well, 36 per cent of organisations claim to have had to reduce staffing hours or force staff to take leave, and 27 per cent have had to let staff go.

But Raskob said the report showed that necessity was the mother of invention.

“When March and April unfolded, a lot of charities had to scale back on their face to face events, and they found new digital opportunities. They found new ways to connect with donors and supporters, or they found reserves of innovation and ways of doing things that they hadn’t thought of, and that’s good for all of us, to know that despite a really challenging time, there are positive things that can come out,” she said.

“One of the keys to fundraisers’ success in future will be the ability to adapt and innovate, particularly around digital innovation.” 

You can find the full report here.