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October 18, 2010 
 
 
The Religion Effect

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There's a strong connection between philanthropy and religious conviction. Yet, younger generations are less and less religious. Fundraising guru and Cygnus Research president Penelope Burk suggests this could have significant consequences for non-profits unless they find ways to compensate for the quiet impact religion has on giving habits.
 
Fundraising guru, author and Cygnus President Penelope Burk
In a Cygnus study looking at 15,000 donors, Penelope found that people who claimed to be actively religious tend to give at a higher level and sustain their philanthropy in tough economic times. They're also more likely to volunteer, including in positions of authority. At the same time, being younger makes people less likely to be actively religious. About 58% of donors over 65 say they're actively religious vs. 40% of donors under 34. "While the impact hasn't been felt yet, it's coming," Penelope says. The problem is that the impact may not come until 50 years down the line, and fundraisers are too concerned with what's going on right now to address such long-term issues. "There isn't anybody working in fundraising today that thinks they'll be working 50 years from now," Penelope says. "They're saying, 'Well, that's not my problem.'"
Fundraising guru, author and Cygnus President Penelope Burk
The current fundraising model is falling behind philanthropic trends, Penelope says. Part of the reason is that fundraisers focus the most attention on those who give the most generous contributions, who tend to be older. In the process, they unintentionally neglect those who give less, including younger donors with very different habits and preferences. Penelope tells us that people over 75 tend to have a more "equitable" view of philanthropy, meaning they're more likely to support a lot of causes and stay loyal no matter how they're treated. That kind of giving is what makes mass marketing like direct mail and telemarketing work. But anyone younger than 75 is moving to reduce the number of organizations they support so they can make larger gifts to the few causes that are most important to them. Yet, non-profits still put most of their budgets and employee resources toward mass marketing. "They keep thinking we can make a profit off direct mail, but it's decreasingly so," Penelope says. "It's not the fault of the people running the direct mail program. It's the fault of overall fundraising design not adapting to the change in thinking patterns among donors."

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Are There Too Many Non-Profits?
 
Alice Rivlin
Brookings Institution Senior Fellow and economic wizard Alice Rivlin took on that question at a Young Nonprofit Professionals Network event last week. She says she's astonished how many non-profits there are in the DC region. (That's more than 38,500, of which about 9,500 are public charities focused on serving the region, according to 2008 IRS data released earlier this year.) While many of them are doing very worthy things, there is a lot of duplication and inefficiencies, particularly among smaller organizations, she says. Not to mention that they're raising money from the same foundations and wealthy people, and there aren't enough of them to go around. In this economic climate, Alice says it's probably a good idea for non-profits to find ways to work together or even merge. "There will be a shakeout," she says.
Alice Rivlin
Alice says she's surprised at the surprise of others that the economy is not back to normal: "I don't think there was a concept of how far off track the US economy had gone. It was an explosion of excess, and now we're having to get back to more reasonable types of economic growth." She adds that there is still room for the federal government to help states and localities, but it will be a hard sell now because of deficits and spending over the last two years. The result is that state and local governments defer—often "stupidly"—things that need to get done: "Eventually, it catches up with you."

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Sponsor Spotlight:
Avectra (and NFi Studios)
 
Avectra’s Howard Pollock and NFi Studios’ Taylor Henry
Avectra’s Howard Pollock and NFi Studios’ Taylor Henry joined us at our recent CTO/CIO breakfast, and the two could technically be considered co-workers now that web-based association management software provider Avectra has acquired Orlando-based NFi (which builds member communities). Avectra marketing VP Patrick Dorsey tells us the acquisition doesn’t mean the end of NFi, which had been an existing business partner. “We will leverage their technology to help build our own community and member-facing features and functionality. However, NFi will be an independent division of Avectra and continue to build, develop, and sell its own products.” Already with its own social community product, NFi’s technology and knowledge will accelerate the innovation that Avectra can put into its offerings. “It makes us both stronger, so we can enter new markets such as international and not-for-profit.” More info on the acquisition here.
 
 
 
Ridgewells Catering 11.1
 
 
Cardinal (10.19) AssocLeg
 
 
Cordia
 
 
Argy (Embrace) ASSOC
 
 
JLL (Soar)
 
 
 
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