© Ask the Fundraiser.com 2006
Despite the largest single relief effort in history for Hurricane Katrina, nearly two-thirds of charities in the United States managed to raise more funds in 2005 than in 2004.
The Association of Fundraising Professionals' (AFP) State of Fundraising Survey 2005 found that 63 percent of U.S. charities raised more money in 2005 than in the previous year, while 13 percent raised about the same amount and 24 percent raised less. The 63 percent figure is only two points lower than the 2004 survey, when 65 percent of U.S. charities raised more money that year than in the previous year.
More than 66 percent of surveyed charities reached their fundraising goal, and 61 percent set 2005 goals that were higher than their 2004 goals. Putting the numbers into the context of the American charitable sector, it is estimated that more than $250 billion was raised by charitable organizations in 2004 (source: Giving USA, Giving USA Foundation) and that number is expected to be higher in 2005. The total assets of the charitable sector exceed $1.76 trillion, and that number has doubled over the past ten years (National Council of Nonprofit Associations).
"The figures from the last two AFP State of Fundraising Surveys certainly complement these statistics and show a very positive trend in fundraising levels over the past two years since a slight trough in 2002-2003," said AFP President and CEO Paulette V. Maehara, CFRE, CAE. In 2002 and 2003, only 49 and 54 percent of charities raised more money than in the previous year, respectively.
While some charities conjectured that the relief efforts for Hurricane Katrina would dramatically affect giving to non-relief charities, the survey results did not bear that out. Two-thirds (67 percent) of respondents reported no immediate impact on their organization's fundraising from the relief efforts, and 94 percent believed they would experience no long-term effects.
"We heard the term 'donor fatigue' used a lot in 2005 to describe how donors might be feeling weary of charitable solicitations and not interested in giving to non-relief organizations," said Maehara. "However, it's clear that a large majority of organizations didn't experience donor fatigue, and we've also seen this in previous years -- with Sept. 11 in 2001 and the Southeast Asia tsunami in 2004. These sorts of tragedies bring out the best in people and frequently lead to gifts from people who have never given, as well as additional giving from established donors."
The survey also examined different types of fundraising and found a mixed bag of results. Direct mail, online fundraising and special events experienced decreased success rates (the percentage of organizations raising more money in 2005 compared to the previous year) of seven to nine percent compared to the 2004 survey. Major gift fundraising dropped three percent and telefundraising two percent, while planned giving saw a three percent increase.
"In general, it was a very mixed year for fundraising techniques," said Alphonce Brown, Jr., ACFRE, vice president of development for the National Association of Public Administration and chair of AFP. "It's important to remember that 2004 was the best year for U.S. charities in the five-year history of the survey, so a slight drop in 2005 performance is not surprising. Overall though, a majority of charities fared very well."
The single biggest challenge U.S. fundraisers cited for 2005 was "too many nonprofits and increased competition for the charitable dollar" (16.8 percent). Other issues cited included "the economy" (13.6 percent), "staffing issues in the development office" (12.6 percent) and "brand awareness of charity and mission" (10.1 percent). 2005 marked the first time that increased competition was ranked as the biggest challenge, supplanting the economy.
Despite these challenges, U.S. charities continue to be optimistic about their fundraising success for 2006. Nearly 70.0 percent believe their organization will raise more funds in 2006 than in 2005, while 21.9 percent think they will raise about the same, and 8.1 percent believe they will raise less funds.
The preliminary results of the AFP State of Fundraising Survey 2005 were released during AFP's International Conference on Fundraising, the largest gathering of fundraisers in the world. A final report with more detailed information will be available in May 2006 at http://www.afpnet.org.
The Association of Fundraising Professionals (AFP) represents more than 27,000 members in more than 180 chapters throughout the world, working to advance hilanthropy through advocacy, research, education and certification programs. The Association fosters development and growth of fundraising professionals and promotes high ethical standards in the fundraising profession. For more information, go to http://www.afpnet.org.
© Ask the Fundraiser.com 2006
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