EOFY 2021 will be a story of snakes and ladders

Garth Stirling, head of Services at ntegrity, dives into how this tax time is different to last year’s and what levers and barriers NFPs are facing.  

Are my targets inflated? Are they conservative? Are they just plain crazy? If you’re asking these questions this EOFY, you’re not alone. 

The fundraising world has turned upside down. The pandemic triggered emergency campaigns and emergency giving for some charities, while others struggled as people switched their giving or tightened their purse strings.

It’s changed the fundraising game. And this means that forecasting has become increasingly fraught, returns unpredictable – it’s almost like the industry is playing a game of snakes and ladders. We know of one charity who forecast $500,000 for a campaign and generated millions, while another saw a 50 per cent drop in campaign revenue despite no big strategic changes. 

Here’s how to play the game of snakes and ladders strategically for your not for profit.

Ladder: Giving remains steady

Giving behaviour in 2021 will see those increasing giving offset by those decreasing. Traditionally, we see giving slowly decrease after a recession. But recent research from McCrindle shows that giving will remain strong into the next financial year – 70 per cent of those that gave in 2020 are intending to give at the same or increased level this year. This is good news for all not for profits, whatever your cause. 

Snake: Emergency giving is out

Last year, wall-to-wall coverage of bushfires and COVID-19 created the case for support for those charities that were contextually relevant. This led to the shifting of big donations toward emergency giving and the entrance of new donors to the market – something that always happens with emergencies. 

However, this year we’ve seen a return to the previous order. Not for profits who experienced an influx of donations last year due to being contextually relevant will likely experience a decline in their tax appeals this year. 

Ladder: Medical research and children’s causes are back as top giving destinations

Source: McCrindle 2021

While COVID is still clearly causing challenges across the globe and driving up need (both locally and globally) research from McCrindle earlier this year shows that Australians are most likely to give to medical and cancer research, with children’s charities taking the second spot. Both top performers before 2020.

That means that those not for profits who experienced a decline in donations last year, due to not being contextually relevant to the emergency, will see donors “come back” to the usual causes they support as Australian giving re-stabilises.

Snake: Cost of advertising has increased

Last year, as big brands halved or stopped their digital advertising spend, paid reach went further as cost-per-mile and cost-per-click decreased across major ad platforms like Facebook during EOFY. 

But the story has changed. Every not for profit, irrespective of size will find it harder and more expensive this year because digital media is more competitive. This means you should forecast your appeal budget and KPIs to accommodate higher advertising costs, and lower ROI. 

Ladder: Mental health is an emerging giving area

A standout performer in 2020, which continues to grow as a top area for younger Australians to give to in 2021, is mental health. The convergence of two trends are driving this giving area. Firstly COVID made mental health discussions very relevant and one of the major ongoing effects of the pandemic. Secondly mental health is the top giving area of Gen-Z – as younger donors give more and in larger numbers, mental health causes are key recipients. Those not for profits that focus on this issue will thrive in 2021. 

Snake: Back to face-to-face

Face-to-face fundraising, from events through to new donor acquisition, is back – but it doesn’t mean its effectiveness is. Face-to-face donor acquisition has one of the highest churn rates, while the presence of COVID-19 (especially in Victoria) has forced many events to be rescheduled or cancelled once again. When it comes to EOFY in-person initiatives, we’re seeing many not for profits continue to redirect resources and budget into digital channels, rather than be at the mercy of face-to-face channels that may or may not be allowed. 

Ladder: Digital integration

Building and refining digital fundraising was a survival factor in 2020. With the return to face-to-face fundraising and in person events, the pressure doesn’t come off digital. The genie is out of the bottle and digital remains a major revenue channel. Its role is also crucial as a key touchpoint supporting offline channels.  We’re all used to googling a product before we buy it in store or checking a restaurant rating before stepping through the door, and fundraising is no different. 

39 per cent of Australian donors said integration of online and in-person aspects of the campaign were extremely or very significant motivators in giving to a campaign. This figure rises to 54 per cent when looking at younger Gen Z donors. 

Those that have taken the time to truly integrate digital at key moments of truth will reap the benefits this year. If this EOFY is a game, a smart digital approach is your chance to get strategic and weigh the dice in your favour. 

Ladder: Optimise, optimise, optimise

Your approach to your tax appeal should never be “set and forget”. Make sure you optimise to drive results in those final five battleground days. 

There are a whole range of things you can do in these last five days. Try reallocating budget to where you’re getting real time results and reserving budget to compete with the big guns. Or look at your audiences – separating out audiences is a great way to provide a more personalised approach. And don’t forget to switch in new creative assets that drive urgency.

Taking chance out of the equation

As we face EOFY, we need to ensure all channels – digital, in person events, DMs, above the line, etc – are all pulling their weight so as to maximise donations. While we are still in a COVID affected market, the clearing mist reveals we’re seeing a return to the previous order. Though there are a few big changes that clearly are here to stay. 

It’s more critical than ever before to be cognisant of current market forces and understand all the snakes and ladders at play. 

It’s a tricky game we’re playing, so best of luck for this end of financial year.