Page 38 - 2025 Nonprofit Industry Trends

KEY FUNDRAISING
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TRENDS FOR 2025
DIGITAL AND MOBILE-FIRST INTERACTIONS
With younger generations being digital natives, there is a significant shift towards
digital-first fundraising strategies. This includes leveraging social media, email,
F undraising is more important than ever as nonprofits navigate a challenging texting, and crowdfunding platforms to engage donors. Traditional methods like
phone calls and direct mail are becoming less effective. Nonprofits must adapt to
landscape marked by inflation, increased competition, and evolving donor these changes by optimizing their online presence and ensuring that their digital
expectations. communication is engaging and user-friendly.
COMMUNITY-CENTRIC FUNDRAISING AI AND AUTOMATION
Building and nurturing a sense of community is becoming increasingly important. AI is playing a pivotal role in enhancing fundraising efficiency. From AI-powered
Nonprofits are focusing on intimate community events, supporter circles, and personalization of donor outreach to using predictive analytics for donor behavior,
local engagement to foster long-term relationships with donors. This approach AI tools are helping nonprofits streamline their processes and improve donor
not only helps in immediate fundraising but also lays the groundwork for sustained engagement. AI is also being used for grant writing, donor retention strategies,
support over the years. By creating a strong community, nonprofits can ensure a and fraud detection. However, it is essential to balance AI’s efficiency with the
loyal donor base that feels personally connected to the cause. need for a human touch in communications to maintain donor connections.
HYPER-PERSONALIZATION INFLUENCER FUNDRAISING
Donors expect personalized experiences similar to what they receive from Collaborating with influencers can amplify a nonprofit’s reach and impact.
commercial brands. Using AI and data analytics, nonprofits can create hyper- Influencers, whether they have a large following or a dedicated niche audience,
personalized communication based on donor interests, behaviors, and giving can help spread the word and attract new donors. This trend is expected to
histories. This trend is crucial for building stronger, more meaningful relationships grow as more people turn to social media for information and engagement. By
with donors. Personalized messages and targeted campaigns can significantly partnering with influencers who align with their mission, nonprofits can reach
increase donor engagement and retention. new audiences and build credibility.
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Donors are increasingly interested in seeing the impact of their contributions. MACHINE LEARNING, PREDICTIVE MODELING,
TRANSPARENCY AND IMPACT REPORTING
AND ARTIFICIAL INTELLIGENCE
Providing detailed impact reports and being transparent about how funds are used Advancements in AI are revolutionizing fundraising strategies. Nonprofits use
can build trust and encourage continued support. This is especially important for machine learning and predictive modeling to automate donor segmentation and
engaging younger donors who value transparency and accountability. Clear and optimize outreach. AI helps answer critical fundraising questions, such as who to
honest communication about the use of funds and the outcomes achieved can contact, how to contact them, and what messaging to use. However, nonprofits
strengthen donor relationships and boost fundraising efforts. should balance AI’s efficiency with the need for human touch in communications
to maintain donor connections.
PEER-TO-PEER FUNDRAISING
AUTOMATION IN FUNDRAISING
Peer-to-peer fundraising continues to be a powerful tool. By empowering
supporters to fundraise on behalf of the organization, nonprofits can expand their Emerging technology tools are increasing automation in nonprofits, freeing up
reach and engage new donors. This method leverages the personal networks of staff for mission-based work. Automation tools can handle online donations,
existing supporters, making it a cost-effective strategy. Encouraging supporters donor management, email marketing, event management, and more. While
to share their personal stories and reasons for supporting the cause can inspire automation improves efficiency, it’s essential to have human oversight to ensure
others to donate. accuracy and maintain a personal touch.
SUSTAINABLE AND ETHICAL PRACTICES SOCIAL MEDIA:
BROADER COMMUNICATION AND DEEPER RELATIONSHIPS
There is a growing emphasis on sustainability and ethical fundraising practices.
Nonprofits are expected to adopt environmentally friendly practices and ensure Social media remains a vital tool for nonprofit fundraising. Engaging with donors
that their fundraising methods align with their values and mission. Demonstrating on social media can lead to significant actions, such as donations, volunteering,
and event participation. Nonprofits should leverage social media to reach a
a commitment to sustainability can attract donors who prioritize ethical and
responsible giving. broader audience and deepen relationships with supporters. Regular updates,
engaging content, and interactive campaigns can keep donors connected and
PLANNED GIVING involved.
The Great Wealth Transfer is a transformative moment for nonprofits, with GENERATIONAL POWER SHIFTS
between $11 and $12 trillion expected to flow directly to charitable organizations.
Planned giving allows nonprofits to build lasting donor legacies by encouraging As Baby Boomers retire, Millennials are stepping into leadership roles within
bequests and other estate gifts. Additionally, with $106 trillion being passed nonprofits. To ensure smooth transitions, nonprofits should incorporate
to heirs, nonprofits have a growing opportunity to cultivate relationships with generational diversity into their leadership teams now. This approach facilitates
potential major donors, ensuring continued support and impact. continuity and prepares organizations for future leadership changes. Engaging
younger leaders can bring fresh perspectives and innovative ideas to the
MORE NONPROFITS, LESS GIVING, AND INFLATION organization.
Inflation has significantly impacted charitable giving, with 47% of Americans INVESTING IN GEN Z
reducing their donations. In 2022, Americans donated the smallest amount in
30 years, representing only the fourth decline in charitable giving in four decades. Gen Z, the largest generation yet, is passionate about change and social causes.
This decline, coupled with the increasing number of nonprofits (about 100,000 While they may not be ideal donors now, building relationships with Gen Z can
new organizations each year), means more competition for fewer donations. pay off in the future. Nonprofits should engage with Gen Z early to be top of mind
Nonprofits need strategies to do more with less and attract and retain donors when they become financially capable of giving. Creating opportunities for Gen Z
despite these challenges. to get involved, such as through volunteer programs or social media campaigns,
can foster long-term loyalty.
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