Mid-Year Look at Nonprofits: Innovating through Stormy Seas

My summer soundtrack so far should include songs like: "Here Comes the Rain Again", "Rain on Me", and "Who'll Stop the Rain" as much of the country gets battered with thunderstorms.

Sailing for nonprofits has been equally stormy as we're confronted with a myriad of challenges that test our resilience, adaptability, and innovation. Yet, each wave gives an opportunity to learn, grow, and fortify our organizations. Here are the top challenges our fellow nonprofit leaders say they're facing along with some inspiration from organizations that are successfully navigating these waters.

Donor Retention: The Elusive Catch

Retaining donors is akin to trying to hold onto a slippery fish. According to the Association of Fundraising Professionals, less than half of donors make repeat gifts. That's quite a concern, considering it's more cost-effective to keep a donor than it is to reel in a new one.

What Some NonProfits are Doing...

1. Developing Regular Communication: The Trevor Project, a national organization focusing on crisis intervention and suicide prevention for LGBTQ youth, introduced "Trevor Lifeline," a monthly giving program. This initiative keeps their donors engaged with regular updates on the impact of their contributions, resulting in increased donor retention.
2. Offering Membership Benefits: Associations of smaller or regionalized nonprofits are reevaluating membership benefits to retain members and donors. These benefits can range from exclusive updates to special event invitations.
3. Recognize your Community: Showing the love to your donors and fundraisers makes all the difference in encouraging them to donate again. One of the biggest reasons donors repeat is because they weren't thanked the last time they gave. This can be as simple as a thank you note or as elaborate as a donor appreciation event.

Leveraging Technology: The Digital Wave

We're living in an exciting time for technology! With AI alone, there will be a sea-change of how organizations and people work and communicate just over the next couple of years. Yet, a study published by NTEN showed that nearly two-thirds of nonprofit professionals feel they don't effectively use tech. This issue limits our efficiency, outreach to our communities, and goal achievement.

What Some NonProfits are Doing...

1. Embracing Virtual Reality: Pencils of Promise, an education-focused nonprofit, developed a virtual reality (VR) film showcasing their impact in Ghana. This VR experience increased engagement and donations, offering supporters a unique way to connect with their cause.
2. Utilizing Social Media: Many nonprofits are turning to social media platforms to reach a wider audience, share their stories, and drive online donations.
3. Investing in Your Tech Stacks: Effective donor management software can help nonprofits track donor information, manage fundraising campaigns, and automate communication tasks and soon will be able to predict donation patterns and write solicitation templates.

Economic Uncertainty: The Stormy Weather

Economic volatility can make us feel our sneakers are filled with water. Stuck! Inflation has everyone jittery and anxious and is disrupting the financial stability of nonprofits, impacting individual fundraising efforts, and -- for some -- program implementation.

What Some NonProfits are Doing

1. Launching Emergency Drives: Feeding South Florida, a hunger-relief organization, launched an Emergency Pantry Drive to collect non-perishable food items from the community amid increased demand due to the pandemic.
2. Diversifying Funding Sources: Many nonprofits are exploring different funding sources, such as grants, corporate partnerships, and crowdfunding, to mitigate the impact of economic volatility.
3. Boosting Advocacy Efforts: Nonprofits are ramping up advocacy efforts like adding allowing taxpayers to claim more toward charitable donations. Such laws could ease funding cuts and provide more to increased service demand.

Recruit and Retain: The Skeleton Crew

Recruiting and retaining skilled staff is a persistent challenge for nonprofits, much like sailing with a skeleton crew. A survey by Nonprofit HR recently revealed that most nonprofits lack formal recruitment and retention strategies.

What Some NonProfits are Doing...

1. Implementing Volunteer Management Programs: Habitat for Humanity Greater San Francisco developed a robust volunteer management program, offering training, recognition, and skill development opportunities.
2. Offering Competitive Benefits: While nonprofits may not always be able to offer high salaries, they can attract and retain staff by offering competitive benefits, such as flexible work arrangements, professional development opportunities, and a positive work culture.
3. Culture: Some nonprofits are revamping their culture as studies continue to show staffers rank having a supportive and collaborative culture is more important to them than salaries.
4. Universities: Nonprofits are partnering with universities to offer internships and co-op placements, injecting needed diversity into the sector and providing a pipeline of passionate and skilled workers.

Cyber Threats: The Hidden Iceberg

With the increased reliance on digital platforms, nonprofits are at an elevated risk of cyber threats. Shockingly, over half of nonprofits experienced a cyberattack in the past year, according to The NonProfit Times.

What Some NonProfits are Doing...

1. Investing in Cybersecurity Measures: When Direct Relief, a humanitarian aid organization, fell victim to a cyberattack, they strengthened their IT infrastructure and implemented strict data protection protocols.
2. Training Staff on Cybersecurity: Regular training on cybersecurity best practices can help staff identify and respond to potential threats.
3. Conducting Regular Audits: Regular audits of IT systems can help nonprofits identify vulnerabilities and rectify them before they can be exploited.

Inflation and Rising Costs: The Rising Tide

High inflation rates and rising costs can affect everything from purchasing supplies to covering operational costs, much like a rising tide limits access to certain routes.

What Some NonProfits are Doing

1. Implementing Revenue-Generating Initiatives: Goodwill Industries of Greater New York and Northern New Jersey set up more retail stores than ever - selling donated goods, generating a significant portion of their revenue and offset cost-centers within the organization.
2. Exploring Cost-Saving Measures: Partnerships are more critical now than in recent memory. Linking up with other organizations for shared services or negotiating discounts with suppliers is paying off.
3. Advocating for Policy Changes: Some nonprofits are advocating for policy changes that can alleviate the impact of inflation and rising costs, such as tax exemptions or subsidies.

Donor Communication: The Message in a Bottle

Effective communication with donors is crucial for fundraising and donor retention. However, many nonprofits struggle to keep their donors informed and engaged.

What Some NonProfits are Doing

1. Implementing Regular Communication: The National Military Family Association (NMFA), used creative campaigns, social media engagement, and regular impact reports to keep their donors invested in their mission.
2. Active Listening: Do a survey with your donors and find out the top adjectives they use to describe themselves as a supporter of your cause than use those words to communicate back to them.
3. Sending an SOS: Writing a personal thank you makes donors and fundraisers feel valued and appreciated.
4. Leveraging Storytelling: Sharing stories of impact can help donors understand the difference their donations are making, fostering a deeper connection with the cause.

Let's keep the conversation going and learn from each other on how to successfully navigate these waters and strive towards our mission.

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Jamie Bearse is the CEO & Founder of Build a Better NonProfit and a nonprofit CEO and executive over the last two decades.