The last two years have without a doubt heavily affected the nonprofit industry, forcing organizations to get creative in their fundraising efforts and continually pivot with the ever-changing landscape amidst the COVID-19 pandemic.
It can be challenging and costly to stay up to date on the latest and greatest in the industry. Our nonprofit experts have put together the top innovative fundraising trends for 2022 so your organization can bring reimagined events and opportunities to new and existing constituents this year.
1. Cryptocurrency for fundraising
Cryptocurrency has been trending recently and for many people, it’s an overwhelming and intimidating topic. The popularity of Bitcoin has continued to grow since 2020 and the rise of cryptocurrency provided early adopters, such as UNICEF and Red Cross, the ability to quickly navigate and learn how to accept this type of currency as a form of donation. But what are the other aspects of cryptocurrency that your organization should be aware of? Here are some of the buzzwords explained:
- Blockchain technology: A specific type of computer database that stores data in blocks that are chained together. All sorts of data can be stored, such as personal identification, legal documents, and financial transactions.
- Cryptocurrency: Digital currencies that are secured by cryptography, a method of protecting information and communication. It’s not controlled by any central authority like a bank, business, or government.
- Bitcoin: The most popular cryptocurrency, that uses a community of computers to store its blockchain. It can be as private as a given user wants it to be. It’s traceable but can be strictly anonymous.
- Non-Fungible Token (NFT): An NFT is a unique asset that’s not directly replaceable with another asset (thus the name "non-fungible"). A fungible token, by contrast, is one that is replaceable with another one identical to it. Unlike Bitcoin or physical currencies, NFTs cannot be exchanged one-to-one, as each NFT is unique. Code is written into this digital token and recorded using the blockchain network it's based on to prove a list of historical ownership and the current owner of a unique digital asset. An NFT can represent any digital creation: music, videos, writing, etc.
- Cryptocurrency donation: There are three ways for nonprofits to accept crypto payments:
- Cryptoprocessor: find a platform that can convert to local currency.
- Personal wallet: allows management to buy/sell with ease.
- Donation platform: dedicated nonprofits providing other nonprofits with a safe and secure crypto donation mechanism.
If your organization is looking to attract younger donors, cryptocurrency may be a good place to start. Among Millennial and Gen-Z donors, there are 1 million Bitcoin owners and the user base is doubling every 18 months, with over 60% of cryptocurrency users being under the age of 40.
Cryptocurrency is also appealing as, much like stock donations, it’s a more tax-efficient way to donate because it’s classified as property. That means no capital gains tax and a fair market value deduction.
2. Gaming for good
Gaming for good is a new form of fundraising where gaming influencers partner with a nonprofit and use streaming services like Twitch to entertain their fanbase and ask for donations. Live streams are often co-branded with custom overlays and donation buttons.
In 2020 alone, over $83M was raised for nonprofits via Twitch using the popular payment processor Tiltify. Tiltify is the leading fundraising platform for streaming, however, since they charge a fee, more free out-of-the-box streaming software options are entering the market such as Streamlabs.
With the gaming industry predicted to grow to $218 billion by 2024, gaming for good partnerships are continuing to grow in popularity, becoming the modern-day telethon. And streaming for charity doesn’t need to stop at gaming–it can include other interactive experiences like a live performance, storytelling, baking, cooking, or arts and crafts.
If you’re looking to include gaming in your fundraising strategy for 2022, it’s also important to consider the pros and cons of the space:
- It’s a great way to attract the next generation of donors.
- The space is not yet saturated with other nonprofits.
- There are a wide array of streamers to engage, so do your homework on their brand, values, and audience to ensure the right fit.
- Reach a new audience that’s drawn to the host, but ensure your values are well aligned as authenticity is key.
- Funds raised come from far and wide and are not limited to a specific geography.
- Your current payment processor may not be able to accommodate this type of processing.
- You must have an internal team that understands the space in order to strategize, plan, and execute.
- Consider if and how you will provide tax receipts to the donor; if you don’t have access to the payments database, this is not possible.
- Depending on the payment processor, you may not receive donor information.
- Gaming donors should not be treated as traditional donors; don’t expect to move them to annual giving, monthly donors, or major gift donors.
- You may need to incentivize the streamers’ fans to watch the live stream, which can mean additional costs.
3. Artificial Intelligence (AI) for fundraising
Automation is an essential part of a digital transformation that leads to more efficient and effective fundraising. AI can increase efficiency, provide growth, and help minimize costs within your nonprofit, so why not put it to work?
The nonprofit industry is still in the early stages of incorporating AI into fundraising strategies, but there are ways to start small. You can start with automating your marketing communications or use Salesforce Flows to minimize the administrative work required from your team and improve your constituents’ experience.
Another option is to add a chatbot to your website. A chatbot is a computer program that simulates and processes human conversation, allowing humans to interact with digital devices in real-time. You may have interacted with a chatbot while shopping online or via mobile for catching a ride, as they can help free up staff time and provide answers around the clock. However, chatbots can go beyond administrative assistance. Crisis Text Line’s application of mission-based AI used chatbots with an impressive algorithm to predict suicide risk by analyzing online conversations. Their Machine Learning model analyzed 65 million text messages and recognized the conversations tagged with “Suicide” by the organization’s Crisis Counselors to pick up what words were associated with a high risk of suicide. As a result, this tool helps the organization prioritize high-risk messages and serve 94% of high-risk texters in under five minutes.
AI can also assist your organization to create more personalized communications that better engage your constituents. Tools like Salesforce Nonprofit Cloud can help analyze donor databases to send personalized emails and convert donors via customized landing pages. By reaching the right person at the right time, in a way that is meaningful to them, you can build stronger relationships and engage constituents throughout their journey with your organization.
4. Mega philanthropy
The impact and recovery of the COVID-19 pandemic have been uneven, with nonprofits seeing a decrease in the number of donors while still exceeding their fundraising goals. Overall charitable giving reached a record of $471 billion in 2020, galvanized by the racial justice protests and response to the coronavirus pandemic. This was primarily driven by the dramatic increase in mega-giving from individuals.
Mackenzie Scott has become the biggest name in mega philanthropy recently having donated $8.5 billion to hundreds of nonprofits since 2020. Scott has disrupted the philanthropy space with the speed at which she is unloading her fortune without the team and traditional structure of a foundation, and with her “no-strings-attached” approach that allows the organizations to spend the funds as they choose. Scott often announces her donations with little fanfare via her blog on Medium, recently stating she hoped “to de-emphasize privileged voices and cede focus to others.”
Donors are thinking big right now, and so should your organization. If you don’t currently have a major gifts strategy, now is the time to create one. These are our top tips for preparing for and attracting major gifts.
- Determine who your current biggest donors are and consider how you can nurture those relationships.
- Demonstrate your plans for the future and how your organization is going to make a large-scale impact. Donors are looking to make big changes, so showing them you’ve got a plan and are up to the challenge is key.
- Consider how you deliver your message, and by whom. You likely want to have your CEO or President there for a big ask, or perhaps include a connection to your board.
- Ensure that the prospective donor has been nurtured throughout their experience with your organization.
- Once you’ve landed a major gift, continue to interact with the donor, showing them how they’ve made an impact and continuing their positive experience.
Get creative with your fundraising in 2022
Gone are the days of solely relying on direct mail, telethons, and banquets for fundraising. If your organization wants to remain competitive, engage new donors, and make an even larger impact—keeping up with the latest trends in fundraising is key to success.
While most nonprofits have prioritized digital transformation over the last two years, you shouldn’t stop there. Now is the time to put those digital tools to work in order to explore the latest trends in fundraising and how they can jumpstart your 2022 strategy. Don’t be afraid to start small and see what works for your organization in order to become more efficient and effective in reaching a larger audience to ultimately fuel your mission.