This year’s survey focused on four key areas: General Operations (including staffing, budgets, and organizational challenges); Fundraising; Technology and Internet Usage; and Accountability and Stewardship.
With 1,140 nonprofit professionals responding, the survey once again found that demand for services, revenue, expenses, charitable donations, and staffing are all projected to rise.
- Increased demand for services was projected by 80% of respondents (compared to 72% in 2006), with an even greater number (82%) seeing this trend continuing next year.
- Increased revenue was seen as a result, with 77% of the nonprofits noting this outcome. Correspondingly, 83% saw the trend continuing in 2008.
- An expectation for increased staffing in 2007 was reported by 47%, compared to 44% a year ago. Increased staffing in 2008 was foreseen by 48%.
Another key finding was that the demand for accountability continues to rise as donors become more involved in the business process. There was a 3% increase this year to 34% of respondents who have experienced a rise in demand from donors to report how contributions were spent.
Similarly reported in 2006, of those who have experienced an increase in restricted funds, almost half claim that they are having trouble getting funds for general operating purposes and that they are specifically seeking unrestricted gifts. As expected, donor retention and managing supporter relationships are viewed as high priorities—both of which are areas where survey respondents believe they have performed well.
Recruiting new donors remains a challenge and is being addressed, in part, by increasing online marketing and fundraising activities. Still, less than half of respondents rated their performance in recruiting new donors as “good” or “very good.”
When asked about fundraising, 74% of survey respondents reported that they expect individual donations (especially via major supporters) to continue to increase. This is a large jump as compared to the 51% who reported individual donations would be a primary source of growing income last year. Corporate donations, foundation grants, and special events were also believed to be the areas of greatest revenue improvement.
One-on-one solicitations of major donors remains the top driver of contributions. Direct mail and special events were the next most effective drivers of raising donations. Online and email solicitations were expected to increase as well from 2006 to 2007.
Nonprofits most often communicate with their donors via direct mail, with 59% saying it is their most common communication channel. This continues a downward trend over the past three years, from 68% in 2006 and 74% in 2005. Direct mail is most commonly used for fundraising appeals, event invitations, and newsletters. Online/email communications are growing, with fundraising and newsletters being the primary strategies.
The use of the Internet continues to evolve for nonprofits. Almost all of the respondents (98.5%) have a website, the direction for which is most often driven by the marketing department. Its primary purposes are for marketing the organization and educating the public. Only 29% see their websites as effective (or better) in achieving their Internet goals.
A consolidated database that contains all information on donors and other constituents is critical to nonprofits’ operations, and 60% of respondents believe they are making good progress in achieving it. Of the respondents, 67% believe that it is important (or more) to use email and other online means to communicate with donors and constituents. Email is considered the most important online tool, with fundraising and newsletters the next most important.
With the heightened usage of technology, it was noted that utilization of technology budgets, plans, and strategies generally showed declines compared to 2006, with only data services budgets being more prevalent than last year. It is possible that some of the “in place” planning was possibly “in process.”
To summarize:
- 88% use their website to market their organization/educate the public
- 50% have data services budgets as compared to 31% in 2006
- 92% believe a unified database is very important
- 68% use online fundraising tools
- 48% actively use online fundraising strategies (compared to 43% in 2006 and 35% in 2005)
- 59% use electronic newsletters
- 38% plan to implement online surveys or polls
As noted above, Internet usage for fundraising continued to increase. The percentage of contributions raised online remains relatively small but is likely to grow. The leading ways that nonprofits drove online contributions were using a “donate now” button on their websites and emails to current donors. While the top two drivers are the same as last year, nonprofits are becoming less dependent on the "donate now" alternative and are moving more toward direct emails. This proactive approach appears to be gaining more traction.
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