Each generation comes with their own set of unique quirks and habits: Boomers don’t understand why someone would text when they could call, millennials are all about their avocado toast, and Gen Z kids are born with the ability to use an iPad. Broad generalizations like these can be useful in your audience targeting strategy, but beware – if you find yourself relying on them too much, you may be missing out on quite a few fundraising opportunities. Here’s what you need to know about generational giving:
Myth 1: Boomers Give More Than Any Other Generation, So They Should Be The Primary Focus Of Generational Giving
This one is partially true. According to 2013 study from Blackbaud Institute, Baby Boomers are responsible for over 40% of all charitable giving. That’s a pretty impressive statistic, but it shouldn’t cause you to devalue donors that belong to other generations. The reality is that the majority of Americans give, regardless of age.
The study also found that Gen X-ers make up 20% of all giving, with a donation average of $732. That number is only expected to go up as they continue to head into a more dedicated career route. The Silent Generation (meaning Americans born before 1945) also gives in impressive numbers. Their annual average gift totals out to a whopping $1,327. That’s well above the industry standard for what is defined as a major gift.
The truth is, if a person wants to give, they should be important to you and your organization. If you dedicate all your attention and resources to Boomers, you could potentially be missing out on some huge fundraising opportunities with everyone else.
Myth 2: Millennials Prefer To Do Everything Online, So Don’t Bother Them With Direct Mail.
Online donations may be rising in popularity, but they still only make up less than 8% of all charitable giving in total. Direct mail, on the other hand, makes up 60-80% of giving, and many of those gifts meet or exceed the major gift standard.
Why is direct mail still so effective after all these years? Because it’s the most personalized method of communicating with your constituents, aside from hosting an in-person meeting.
Regardless of age, people like to be thanked and thanked again online and IRL. The key is to zero in on those that have shown they care about your organization by thanking them repeatedly, in every way you can.
Consider sending them a personalized thank you email or giving them their own personal shout-out video. If you have the bandwidth, a handwritten thank you note will always be the gold standard.
Myth 3: Using Generational Giving To Segment Your Audience Is The Most Effective Targeting Method.
Yes – generally speaking, people from different generations do have different preferred methods of communication. It may sound wise to segment your audience based on these facts, but in reality, it’s time consuming and it doesn’t yield the highest possible return.
Instead, segment your audience by recurring donors and major donors, with the goal of nurturing your casual donors into recurring donors and your recurring donors into major donors.
The rise of the subscription model business has made people of all ages more comfortable with signing up for recurring donations. On top of that, the American culture of philanthropy makes it so that people genuinely enjoy giving, even if they can’t do it one large lump sum. If you’re trying to identify potential recurring donors, nurturing casual donors with personalized thank you’s can be a very powerful tactic.
Try acknowledging constituents by name, and mentioning when and how much they gave. Then share a bit about how you will be allocating those funds. It’s a lot of information to keep track of, so this is where a comprehensive donor database that tracks these specific pieces of donor information can come in handy.
End your message with a call-to-action for your recurring donation program and watch your new donors roll in. Eventually, when they have the financial ability to make a larger donation, you’ll be the first organization on their mind.
Research has shown that there are definitely differences in generational giving, but they aren’t as stark as what you might think. If you’re trying to figure out how to segment your constituents for higher returns, we wouldn’t advise segmenting by generation.
Instead, focus on identifying those that have given before and nurture them into repeating the action. It’s a proven, effective way to excite your audience regardless of their thoughts on avocado toast.
So Why Is Everything Wrong?
As the numbers show, the facts behind generational giving don’t match up with these myths that nonprofits have heard for years. It turns out those coveted Millennials are actually donating on par with older generations, and the generational giving divide may not be as sharp as we thought.
Changes In Media Consumption
According to Deloitte, changes in media consumption habits — mainly streaming services — have blurred the lines between generations. They’ve even gone as far to rebrand Gen X, Millennials, and Gen Z as one segment: “MilleXZials.”
Even though each generation may have its own unique preferences, it turns out that people of different ages aren’t all that different. Ultimately, everyone appreciates convenience and personalization.
Appeals & Generations
Although online giving is only about 13% of all giving, it’s often touted as the #1 strategy for reaching younger generations. To be fair, online giving is rising every year, driven by Millennial preferences — and an optimized online donation form definitely won’t hurt your organization’s fundraising. But research shows that more traditional strategies still work for all donors, regardless of age.
Direct mail fundraising is responsible for 60 – 80% of all fundraising revenue. Yup, direct mail is definitely not dead. In fact, 37% of donors cite receiving direct mail as the reason they gave, regardless of what they gave. (Source: USPS)
Events are also huge, especially for younger generations. According to the Chronicle of Philanthropy, 90% of donors prefer to give in person. But don’t start planning your gala just yet. Donors are shifting more toward peer-to-peer, DIY fundraising — and revenue from this type of fundraising has increased by 84% in just two years.
Action Items: Concrete Steps We Can All Take
1. Multi-Channel Campaigns
As we saw above, all generations consume media in many different ways. Your nonprofit can leverage this with a multi-channel campaign. These campaigns include touch points across several channels, from email to direct mail to social media to in-person. According to NextAfter, these types of campaigns can lead to a 204% higher conversion rate.
2. Two Segments
To help create more effective fundraising campaigns, think of your donors in (at least) two basic segments: recurring donors & major donors. Regardless of generation, these groups are fundamentally different audiences who have different engagement needs.
In general, segmenting donors by action (like major vs. recurring donors) will help you build better supporter relationships than segmenting by demographics (like age).
3. Keep It Donor-Centric
No matter what strategies you use to engage donors, remember to keep it focused on each donor and their needs. You might have a Gen Z donor that prefers print mailings, and a silent generation donor that only wants to be contacted via email.
Generational giving statistics can help point us in the right direction, but listening to our donors and giving them options for personalized engagement is key to success. Think about how your organization is engaging supporters, and how you can leverage your tools to create more personalized experiences at scale.