A recent study from EAB found that higher education, an industry already facing financial questions it never has in the past, has still yet to experience the true fallout of the COVID-19 pandemic. Many leaders are conscious of the short-term effects of the crisis with declines in enrollment numbers, increased maintenance spending to combat infections, and the recent hits to the stock market that leave endowments damaged. But how this will play out in the longer term is still yet to be seen.
The survey found that more than 40 percent of respondents expect to see double-digit declines in fundraising revenue for the upcoming fiscal year, and more than one out of every five respondents expecting losses of over 20 percent. What does this mean for the long term?
As many colleges and institutions ask the top of the donor pyramid to compensate for these losses, not all major donors still have the ability to give at previous levels. Being able to rely on your top 100 donors is now an obsolete strategy as the stock market downturn may have deeply affected their ability to give. During the Great Recession, colleges and universities saw a 33.1% drop in the three largest gifts between FY 2008-2009.
Reliance on major gifts will put many schools at risk long term, with more than 45 percent of survey respondents anticipating more double-digit declines in FY 2021. While one larger gift requires fewer resources to secure, a major donor’s inability to support at a high level could prove damaging for an organization with little or no major gift pipeline. Ultimately, fundraisers will need to reach more donors to offset these losses.
But in an ecosystem of staff reductions and hiring freezes, contacting more donors becomes a more difficult task. Only a few months ago, the term “innovation” was viewed in a negative light -- few saw the reason to change the way things worked. But, those that were willing to innovate now have a leg up. So much has fundamentally changed in fundraising that the way things used to work no longer exists, and the path forward is clear: innovate or risk your own ruin.
Innovation lies at the heart of necessity, in this case, the necessity to further saturate the middle of the giving pyramid, or the “rated but unassigned” donors. The traditional method of reaching these donors was hiring another gift officer -- a tactic that is not possible at a time of furloughs, layoffs, and budget cuts. Fundraising teams must be more efficient with the staff they already have.
Gravyty’s fundraiser enablement tools aren’t just for organizations looking to shake things up -- it’s to set the path forward. In fact, one organization looked to Gravyty for their very survival. According to Laura Willumsen, Senior Direct of Development at Shakespeare Theater Company, innovating with Gravyty was “the path forward to communicating on an individual, personalized basis…with a much larger group of donors, and a smaller staff.”
Institutions like The College of Charleston, for example, operate as if they were an organization with 2.6x more frontline fundraisers, by leaning into innovation for the sake of hitting a new level of giving results, with Gravyty.
In today’s world, meaningful innovation is the only way to take control of an unpredictable economy and environment. If you'd like to talk about ways to innovate around hiring freezes and staff reductions, donors unable to honor pledges in a bad economy, or being swamped with new donors and no path to engage them, then come talk to us.