How to Build Trust and Engage Millennials and Generation Z Donors

Build Trust Engage Millennials and Gen Z Donors

For some time, the charitable sector has faced a number of challenges and hurdles to its long-term future and success. One of those recognized challenges has been developing the ability to attract and retain younger donors. Enter COVID-19 and the strain on organizations and their donors has become more pronounced. Even prior to the pandemic, the sector had been experiencing a gradual decrease in the number of individual donors and an overall decrease in individual giving. There also exists a gap between how much donors want to trust charities before giving and how much charities are actually trusted. The sector needs new relevant ways to attract and engage younger donors: models that meet these donors where they are, earn their trust, and meet their privacy and security preferences.

The Charitable Sector: A Decrease in Individual Giving, a Trust Gap, and COVID-19

GivingUSA’s 2019 Report outlines that over the last 40 years the charitable sector has seen giving by individuals decline as a percentage of inflation-adjusted total giving. It has dropped from 83 percent during the five-year period beginning in 1979 to 70 percent during the five-year period beginning in 2014. The financial crash, stagnant or falling disposable incomes and lower levels of job security has had the knock-on effect of charities becoming ever more dependent on older donors and large corporations. Changes to the tax law and the standard deduction has removed some tax incentives for medium-sized donors and could potentially reduce individual giving.

Findings from our 2019 Donor Trust Report series show that while 69.8% of respondents rated the importance of trusting a charity before giving as 9 or 10 (Essential) on a 10-point scale, only 19.0% of respondents say they highly trust charities. This is despite the sector being the most trusted institutional sector: donors trust charities more than the government (79%-21%), the media (78%-22%), business (68%-32%), banks (68%-32%) and organized religion (65%-35%).

In 2020, COVID-19 has upended traditional charity fundraising models. A survey of our accredited charities (who meet all 20 BBB Standards for Charity Accountability) taken a few weeks in to the pandemic (March 2020) showed that 80.5% of the charities anticipated lower than expected revenue in 2020, and 60.9% anticipated that they will be unable to host some fundraising events. Only 19.6% reported that they were likely to lose less than 10% of their budgeted revenue. 61.2% of charities surveyed are very concerned about the impact of COVID-19 on the charitable sector. It is worth noting that the surveyed charities may be larger and sturdier than the sector as a whole and, since March, we imagine that charities’ projections may have only gotten even more dire.

Meeting Millennials and Generation Z Donors on Their Terms

GivingUSA’s 2019 Report outlines that over the last 40 years the charitable sector has seen giving by individuals decline as a percentage of inflation-adjusted total giving. It has dropped from 83 percent during the five-year period beginning in 1979 to 70 percent during the five-year period beginning in 2014. The financial crash, stagnant or falling disposable incomes and lower levels of job security has had the knock-on effect of charities becoming ever more dependent on older donors and large corporations. Changes to the tax law and the standard deduction has removed some tax incentives for medium-sized donors and could potentially reduce individual giving.

Findings from our 2019 Donor Trust Report series show that while 69.8% of respondents rated the importance of trusting a charity before giving as 9 or 10 (Essential) on a 10-point scale, only 19.0% of respondents say they highly trust charities. This is despite the sector being the most trusted institutional sector: donors trust charities more than the government (79%-21%), the media (78%-22%), business (68%-32%), banks (68%-32%) and organized religion (65%-35%).

In 2020, COVID-19 has upended traditional charity fundraising models. A survey of our accredited charities (who meet all 20 BBB Standards for Charity Accountability) taken a few weeks in to the pandemic (March 2020) showed that 80.5% of the charities anticipated lower than expected revenue in 2020, and 60.9% anticipated that they will be unable to host some fundraising events. Only 19.6% reported that they were likely to lose less than 10% of their budgeted revenue. 61.2% of charities surveyed are very concerned about the impact of COVID-19 on the charitable sector. It is worth noting that the surveyed charities may be larger and sturdier than the sector as a whole and, since March, we imagine that charities’ projections may have only gotten even more dire.

A Time to Take Action: GiveSafely.io as a Tool for Charities

Donors want to give to trusted charities but some also worry about their personal information being hacked, stolen, misused and improperly monetized. On the other side, charities have been searching for new ways to make up for decreases in the number of people donating. While younger donors express a willingness to be approached, charities still search for the right ways to connect with them. The COVID-19 pandemic has upended many charities’ traditional outreach methods and charities are being challenged to move engagement online.

Responding to these challenges, BBB Wise Giving Alliance launched its GiveSafely.io donation platform on July 4th. Targeted at younger and tech-savvy donors, GiveSafely.io uses blockchain technology (Ardor) to arrange peer-to-peer relationships where donations and data flow directly from donors to the intended charities while securing donor information. All charities on the platform are trustworthy: they meet the 20 BBB Standards of Charity Accountability. There is no intermediary: GiveSafely.io has no access to the donations or data, and will receive no transaction fees. There is no cost for charities to participate.

To promote and deepen donor-charity engagement, and acknowledge the growing awareness that personal data is someone’s property and should be valued as such, when a donor gives and shares their data, they are rewarded with GivingPoints. GivingPoints are redeemable for online experiences with any of the participating charities. The 15-30 minute reward experiences are designed to connect the donor more intimately to the charity’s mission in a conversational, low-pressure format. They include offers like interactive video chats about ethics in the charitable sector, surprises while working in the field at a particular charity, career advice for entering the charitable sector, and AMAA (Ask Me Almost Anything) conversations with charities’ leadership or staff members. All BBB WGA Accredited Charities are eligible to participate. Trusted charities involved with the launch include: Save the Children, Easterseals, Humane Society, Physicians Committee for Responsible Medicine, Population Media Center, RedRover, Wild Animal Sanctuary, Cure Alzheimer’s Fund and World Emergency Relief. This list will expand in the weeks ahead.
The charity sector in the USA has for some time been facing considerable challenges related to an ageing donor base, reliance on larger corporations and declining allegiance to established institutions. Today’s youth are demonstrating an increasingly proactive approach to how institutions act on their behalf and shape the society they are living in. GiveSafely.io was designed to embrace these values and perspectives ensuring people are engaged and feel included when making a donation. When people feel they are on equal terms, informed about where their money is going and how it is being spent and that their personal data is secure, participation and donations from Millennials and Generation Z will finally reflect the activism and expressed wishes of this already very influential demographic.