It’s no secret that the year-end giving season is critical for nonprofits. Your organization may bring in anywhere from 24% to 47% of its annual revenue in November and December, and about 12% of all charitable donations occur in the last three days of the year!
When you see numbers like those, it can be tempting to dive straight into fundraising planning, setting ambitious goals and brainstorming creative ideas to achieve them. However, to maximize your success, you also need to consider the financial aspects of your campaigns to ensure a positive return on investment (ROI) and put your organization in a strong position as you enter the new year.
In this guide, we’ll walk through four strategies to help your nonprofit finish out its fundraising on a high note for the year, from GivingTuesday to December 31. Let’s get started!
1. Diversify Your Fundraising Channels
Your supporters like to engage with your nonprofit in various ways, and some only do so at the end of the year. So, offering many avenues to contribute will help you bring in more revenue from more donors. Plus, diversification provides a stronger safety net for achieving your fundraising goals, because even if one source falls short of expectations, you’ll have others you can rely on.
Here are a few ideas for fundraising channels you can add to your year-end strategy, organized according to the five major categories of nonprofit revenue:
- Individual donations: While traditional direct mail appeals and general online giving have their place, you might also try more creative ideas to engage donors during this valuable time. These might include crowdfunding campaigns, peer-to-peer fundraising, seasonal events, a special year-end text-to-give keyword, and in-kind donations of goods and services.
- Corporate philanthropy: Your supporters’ employers may also want to get involved in your last fundraising push of the year in various ways, from sponsoring events to matching employee donations to providing volunteer grants when supporters contribute their time to your efforts. Research local companies’ corporate giving programs and let supporters know how to check their eligibility as you promote your campaigns.
- Earned income: If your nonprofit has a membership program, you’ll likely send out many renewal reminder messages at the end of the year. You might also design and sell a special line of branded merchandise or offer specials on paid services at this time (for example, discounting adoption fees for the month of December at an animal shelter or running a “winter break” promotion on admission to a museum).
- Investments and grants: Investments and grants are generally focused on long-term funding. So, the only highly applicable revenue sources to year-end fundraising in these categories are marketing grants that can finance some campaign promotions and challenge grants, when a donor agrees to make a gift after you’ve hit a certain revenue target.
Make sure you’re prepared to track data on all of the fundraising strategies you leverage so that after the year ends, you can review each revenue source’s profitability and plan future campaigns accordingly.
2. Focus on Donor Retention
Prioritizing donor retention is one of the best ways to make your nonprofit’s fundraising efforts cost effective. On average, it costs $1.50 per dollar raised to acquire a new donor for your organization, but only $0.20 per dollar raised to retain an existing one. Retention is especially important at year-end because it provides your organization with a stable support base going into the new year.
To help you integrate this focus area into your fundraising efforts, NXUnite’s donor retention guide recommends the following strategies:
- Segment your supporters based on demographics, psychographics, past giving, and engagement history so you can send targeted communications to groups that share similar characteristics and would respond well to those messages.
- Demonstrate impact through data, stories, and photos that provide tangible insights into how you’re using donors’ contributions to further your nonprofit’s mission.
- Prioritize transparency by publishing financial information, gathering and implementing feedback, being honest when issues arise, and otherwise working to strengthen supporters’ trust in your nonprofit.
It’s also helpful to consider the specific reasons donors may stop giving to your organization so you can proactively prevent them from lapsing. For example, if you know some donors are facing personal financial setbacks that are making it challenging to contribute as they normally do at the end of the year, you could promote free activities like volunteering and advocacy to keep them engaged until they’re in a position to give again.
3. Balance Fundraising Activities With Financial Management
As Jitasa’s year-end giving guide explains, “With a few exceptions, most nonprofits’ fiscal year follows the calendar year. So, while your team is managing its year-end fundraising, you’ll also need to wrap up your financial activities for this year and prepare for next year.”
Some financial tasks you’ll need to add to your to-do list at year-end include:
- Recording any outstanding transactions in your accounting system
- Reviewing all stored data to ensure it’s accurate, complete, and consistent
- Performing a final bank reconciliation so your internal and external records match
- Managing outstanding financial obligations, such as those in your accounts receivable and accounts payable
- Checking on investments and assets to ensure they’re categorized correctly
- Compiling financial statements like your balance sheet, statement of activities, functional expense report, and cash flow statement
- Creating charts and graphs for the financial section of your annual report
- Finalizing next year’s operating budget and getting it approved by your board of directors
- Planning for tax season so you can file your nonprofit’s Form 990 on time
- Ordering W-2s and 1099s to issue to each of your employees and contractors
Many of these tasks can’t be finalized until the very end of this year or the beginning of next year because you won’t have complete revenue and expense data before your year-end fundraising efforts wrap up. The earlier you can start on fundraising planning, and the better you are at delegating duties to the staff members who are best equipped to handle them, the easier it’ll be for your team to keep your campaign on track while also working on financial activities.
While every nonprofit’s year-end fundraising approach will look a bit different, the tips above should provide a solid foundation for planning a campaign that’s both engaging and financially savvy. If your internal team has any questions or needs additional help to manage this busy time of year, don’t hesitate to reach out for the professional expertise that would be most beneficial to you, whether that’s fundraising consulting, technical assistance, or financial advising.
Also, if you’re looking for GivingTuesday templates, worksheets, calendars, checklists, emails, and Neon One product tips to kick off your end-of-year strong, check out the Neon One GivingTuesday Resource Center.
Since joining Jitasa in 2010, Jon Osterburg has helped hundreds of nonprofits around the world effectively manage their finances through tailored, outsourced bookkeeping and accounting services. He currently serves as Jitasa’s Chief Operating Officer, is a member of two nonprofit boards, and has earned a certificate for Executive Education from the Yale School of Management.
