When Fundraising Best Practices and Experimentation Work Together: The 2021 Spool to Sphere Comparison
The Spool to Sphere Comparison is Thread's annual research, analysis, and action report focused on End-of-Year giving, the most lucrative and busy time for nonprofit fundraising.
We are very excited to share with you the 2021 Spool to Sphere Comparison. We are especially excited because this year marks the third anniversary of this report, meaning we are now in place to see how our Spool is evolving over time.
Every coin has two sides. In nonprofit fundraising, those two sides are best practices and experimentation.
On the best practices side, there are certain tried and true methods to strategizing and executing the work of cultivating, soliciting, and stewarding your donors. Ignore these best practices and you make the work harder for yourself while imperiling your revenue outlook.
On the flip side, there’s experimentation. Fundraising is a discipline that rewards creativity and new ideas, and there’s always a new trend to learn and put your own spin on. Ignore experimentation and your fundraising performance is likely to get stuck in a rut.
To help our nonprofit partners look equally at both sides of the fundraising coin, each spring Thread produces the Spool to Sphere Comparison. This is our annual research, analysis, and action report that focuses on End-of-Year (EOY) giving in September – December, the most lucrative and busy time for development each year.
Our goal with the Spool to Sphere Comparison is twofold. First, we want to see and share how smaller, community-based nonprofits, like the organizations that largely comprise the Thread community (our “Spool”!) fare in the planning and performance of their EOY campaigns compared to best practices across the larger sphere of nonprofit fundraising. Second, we want to surface new trends and ideas so that our Spool can join in on the experimentation.
We are very excited to share with you the 2021 Spool to Sphere Comparison. We are especially excited because this year marks the third anniversary of this report, meaning we are now in place to see how our Spool is evolving over time.
See below for three high-level takeaways to get you excited about the Comparison, and go ahead and download your own version of the report!
#1: Campaign Planning Prowess
One of the most significant trends we could see from the three years of Spool to Sphere data we now have is that our partner organizations have heard our message and heeded the call to begin EOY planning EARLY. No more waiting until October to figure out EOY fundraising; we’re seeing the majority of partners get their campaign strategy going in August or September. This longer runway into EOY fundraising season is so helpful and important to setting yourself up for success!
We’re also more sophisticated goal setting (hello sweet spot goals!) and more robust donor segmentation (yes!). The other big best practice adoption we’re seeing is more and more organizations increasing the total volume of EOY communications they send, including incorporating cultivation-exclusive communications. It’s so exciting to see all these best practices falling into place for our partners.
#2: Dollars Were Up, Unique Donors Were Not
2021 was another record-breaking year for total philanthropy contributed. GivingTuesday raised over $2.7billion. Classy, the online donation processing platform, transacted $1.143billion in donations, its greatest year ever.
While the larger nonprofit sector was celebrating a banner year, so too were many partners in Thread’s spool. In our survey, we saw that:
76% of respondents saw their 2021 EOY campaign outperform 2020
48% of respondents saw their 2021 GivingTuesday fundraising outperform 2020
48% of respondents raised more dollars via digital fundraising than they did in 2021
52% of respondents raised more dollars via direct mail than they did in 2020
The raincloud over this parade is that while total philanthropic dollars were up, the number of participating unique donors was not. Household participation in charitable giving fell 17% percent from 2000 to 2018 according to a study from the Indiana University Lilly Family School of Philanthropy at IUPUI, and data specific to 2021 from both the Association of Fundraising Professionals and M+R back confirm the trend.
The lesson to learn from these data is that stewardship of your small and mid-size dollar donors is more important than ever. You literally cannot afford to let these donors go unrecognized, unappreciated, and unsolicited because it is getting harder and harder to replace them. If you need help developing a plan for how to increase stewardship at all levels, let’s talk.
#3: Digital Fundraising is Pushing Both Best Practices and Experimentation
Digital fundraising is continuing to grow as a percentage of total philanthropic activity, with the Blackbaud Institute reporting a 42% year-over-year increase in 2021 and that 12% of total fundraising came from online sources. As digital continues to grow, nonprofits need to be ready by doubling down on best practices AND getting creative.
Now is the time to return to the basics, such as optimizing your donation page and tailoring your fundraising copy for different platforms.
It’s also the time to look into and start offering different payment methods such as Venmo, PayPal, ApplePay and other digital wallet options, as younger donors prefer these modes of giving to their credit card. Cryptocurrency is another opportunity to at least start learning about, if not preparing the capabilities to accept donations in this form.
To download the full report and get the full Spool to Sphere scoop, click here.
Have questions or want to talk about your ideas for EOY 2022? Let us know! Email us at hello@threadstrategies.com so we can get the conversation started.