24 May Are We Panicking Yet?
24 May 2022
By David Allen, Development for Conservation
Last week, I promised you a blog about strategies for recruiting new donors. I’m still going to post that, but I’m putting it off a week.
Because the stock market is down 20%.
And I’m sensing a level of concern about it. Someone even hit me with the “we can’t be tone deaf” card. Ouch.
The implication of this concern, in all of its various forms, is that we can’t or shouldn’t ask for money now because people have lost money in the market. In my opinion, this is just boneheaded.
It more likely represents a deep discomfort with asking than a real concern about people’s stock portfolios.
Let’s start here:
- The first reason people give money is that they want to see something done. The reason they give it to us is because we are doing that something, and they trust us to get it done.
- What we are doing – in most of our cases protecting land, conserving natural spaces, providing access to Nature, “producing” clean air and water, mitigating climate change, and so on – is IMPORTANT work, URGENT work, and TIMELY work.
- The FODs (Forces of Darkness) are also working – converting farmland into housing, stripping off and selling topsoil, splitting large tracts into smaller and smaller tracts, spreading nutrients and poisons, and so on.
- The most important limiting factor for us is the amount of money we have to work with. Money translates into staff capacity and land acquisition capital. Contributions – of all sizes – are important, urgent, and timely as well.
- We ask for money from people who believe what we believe. Because people will give more when we ask. Because some people will give at all because we ask. Because NOT asking sends a message that giving IS NOT important, urgent, and timely. Because NOT asking is the same as saying NO for them – taking their choice away.
ALL of those things are true. NONE of those things change because the market is down.
About 15% – one in seven – of Americans are directly invested in the market. That’s DOWN from 2001 as the wealthiest Americans have continued getting wealthier. Another 40% are indirectly invested through retirement funds, mutual funds, and so on. All of these investors will experience the market drop differently, depending on their individual situations. Some will over-react. Some will give less money away.
Inflation is another concerning factor. Gas and groceries are costing more and more just in time for summer vacations. Some people will experience inflation differently, depending on their individual situations. Some will over-react. Some will give less money away.
All of those things are true. They just shouldn’t affect our behavior.
Because what we’re doing is important, urgent, and timely. And that doesn’t change with the market.
What can we learn from past periods of economic stress?
- Some people will reduce their giving. They tend to give less by giving to fewer organizations – not by giving less to everyone.
- One of the areas to watch particularly closely is the monthly giving donors. When donors feel stressed, one of the places they look at is what’s coming out of the accounts automatically. Cancelling those auto payments helps people feel more in control.
- Organizations with strong connections – strong engagement – with donors tended to be the ones least affected.
- Foundations are a different story. Many foundations reacted to the recession in 2008 and 2009 by halting all new grants.
- Business giving was not quite as predictable. Business giving was related more to the specific industry than to the state of the economy.
What can we do?
- Increase the frequency of all donor communications, but especially tangible communications like paper newsletters. Frequency is more important than weight. Fill the pages with messages of importance, urgency, and timeliness. Touch, move, and inspire through storytelling.
- Call people to say thank you right after they’ve given.
- Use the land – create additional engagement opportunities this summer and fall to get people out onto the land – to see firsthand that their giving is producing real results. Things they want to see done.
- Ask people – sensitively – to give, to renew, to invest, and to increase their commitment.
- And if they can’t or won’t for any reason, be thoughtful and gracious in response.
In other words, now that the market is down, we should keep doing all the things we know work. All the things we should be doing anyway.
And if it takes an extra week, month, or even year to meet the goals because of the economy, so be it.
Cheers, and Have a great week!
PS: Your comments on these posts are welcomed and warmly requested. If you have not posted a comment before, or if you are using a new email address, please know that there may be a delay in seeing your posted comment. That’s my SPAM defense at work. I approve all comments as soon as I am able during the day.
Photo by KIMDAEJEUNG courtesy of Pixabay.