Future

of the Nonprofit
Sector

Katherina, Lourdgenie, Sun

Definition & Importance
 Let’s Discuss!

What comes to mind when you

hear the word “future”?
Defining Future in the Non-Profit Context

Aspects of this competency:

❖ The nonprofit sector’s dynamic nature

❖ Continuous improvement
➢ Ex: Program Evaluation
❖ Trends & innovations
➢ Technology plays a key role
❖ Research is critical in shaping best practices
➢ What works? What doesn’t work? What
might work?k

Image Source: Clipground, clipground.com

 Defining Future in the Non-Profit Context
These methods of future-thinking can be applied to many
different aspects of the sector:

❖ Methods and strategies of leadership

❖ Strategic planning processes

❖ Volunteer recruitment and management

➢ Technology used in recruitment

❖ Implementation of program activities

❖ Program evaluation

❖ Economic practices
➢ Ex: Charity Water’s economic model
combining nonprofit and private sector
economic methods
Image Source: Charity Water, charitywater.org
The Nonprofit Sector’s Importance:
Why Focusing on the Future Matters

❖ Nonprofits:
➢ Understand the particular needs of the
people they serve

➢ Have an “on the ground” perspective

of the community

➢ Specialize in particular services

➢ Are catalysts of change

❖ The nonprofit sector has a unique and

important role in the world. Preparing for the
future allows the sector, and consequently
the people it serves in the world, to thrive.
Image Source: ATLAS.ti, https://atlasti.com/institutions/non-profit-discounts/
The Nonprofit Sector’s Importance:
Why Focusing on the Future Matters

“Charitable nonprofits embody the best of America. They provide a way for people
to work together for the common good, transforming shared beliefs and hopes into
action. They give shape to our boldest dreams, highest ideals, and noblest causes.
America’s 1.3 million charitable nonprofits feed, heal, shelter, educate, inspire,
enlighten, and nurture people of every age, gender, race, and socioeconomic status,
from coast to coast, border to border, and beyond. They foster civic engagement and
leadership, drive economic growth, and strengthen the fabric of our communities.
Every single day.”
- National Council of Nonprofits
Future Trends & Challenges
Future Trends - by look at the status quo

❖ The Continually and significantly growth of the nonprofit sector

➢ More than 1.5 million nonprofits registered in the U.S.
➢ Gone up by 20 percent over the past ten years
➢ Employees are leaving the for-profit world to work at nonprofits
❖ Recovery slow and uneven from pandemic
➢ 1 percent quarter-over-quarter decline in gross value-added to the economy — to 5.6 percent of
gross domestic product
➢ A 10.7 percent increase in gross nonprofit outputs
■ 20.6 percent drop among education nonprofits
■ 23.6 percent increase for health organizations
■ 95.6 percent jump for social services providers

The sector is growing continuously and significantly, but it is snowing down due to the effects of
pandemic.
Future Trends

❖ Donors’ habits & motivations changes

➢ Digital acceleration
■ the pace of digital adoption has accelerated by three years
■ at least 80% of customer interactions are digital in nature
■ Most email metrics — including open rates, click-through rates, response rates, and page
completion rates — went up
While detractors have been predicting the death of email for some time, the data says otherwise.
Specifically:

● Email list sizes grew 3%.

● Email volume increased by 17%, reversing a declining trend in recent years.
● For every 1,000 fundraising messages sent, nonprofits raised $78 — a 35% increase over 2019. The hunger and poverty sector
saw a 243% increase.
● Open rates increased 9% to an average of 21%. Not surprisingly, donors were more responsive than non-donors (22% vs. 18%);
click-through rates for fundraising messages were actually higher for prospect audiences (1.7% vs. 1.6%).
● Average response rates increased to 3.6% for advocacy email (0.5% increase) and 0.10% for fundraising email (41% increase)
over the previous year.
● Unsubscribe rates decreased. M+R attributes this, in part, to better list hygiene (especially in the UK which has GRDP). As a
general rule, unsubscribes average 8.8%; bounces average 7.2%.
● Landing page completion was 32% for donors, and just 8% for prospects. M+R attributes this to fact donors are more likely to
have payment information stored online, making the donation process simpler. Also, donation pages may lack sufficient content or
context to convert a prospect, while a donor arrives already convinced of the need to give. The landing page is critically important
in closing gifts; anything you can do to decrease friction is a worthwhile endeavor.
Future Trends

❖ Donors’ habits & motivations changes

➢ Digital acceleration
■ the pace of digital adoption has accelerated by three years
■ at least 80% of customer interactions are digital in nature
■ Most email metrics — including open rates, click-through rates, response rates, and page
completion rates — went up
■ Mobile engagement increased.
There was significant growth in both website access and messaging using mobile devices

● Half of all nonprofit website visitors used mobile devices. Even so, desktop users still accounted for the majority of
transactions and revenue. The balance of traffic, transactions, and revenue continued to shift toward mobile users.
● Mobile audiences for bulk text messaging (similar to email or direct mail) grew by 26%. On average, nonprofits had 50
mobile subscribers for every 1000 email subscribers. Mobile lists are still much smaller than other mailing lists, but they
grew faster than email (3% growth) in 2020. The click-through rate was 6% (vs. 1.7% for email).
● Mobile P2P messaging stayed steady. Recipients may have received more texts however, as more nonprofits used this
type of messaging tool. Response rate was 9.8% (i.e., sending a return text message to the message sender). Opt out rates
increased however. M+R thinks this may lead to some restrictions from carriers.
● There is a trend towards contactless mobile payments. Apple Pay, Google Pay, PayPal Express and other ways to make
donating easier.
Future Trends

❖ Donors’ habits & motivations changes

➢ Digital acceleration
■ the pace of digital adoption has accelerated by three years
■ at least 80% of customer interactions are digital in nature
■ Most email metrics — including open rates, click-through rates, response rates, and page
completion rates — went up

■ Mobile engagement increased.

➢ Generational shifts

■ older generations- organization’s credibility — trust, familiarity, and prior giving history

■ Younger generations- more flexible, their loyalty to a brand is not automatic, heavily

influenced by the political and social identity of the nonprofit.

Challenges

❖ Fundraising
➢ Increasing Competition
■ Resource distribution- Money flowing to larger nonprofits
➢ Lack of Government Funding
➢ Maintaining trust
■ Economic pressures and remote work environments made fraud in the
nonprofit sector both more tempting and harder to keep in check.
■ Even only one Fraud, Theft, and Embezzlement news will led to the loss of
faith and trust from the supporters and audience.
Challenges - cont.

❖ Recruitment and Retention employees and volunteers

➢ lack a formal retention strategy
➢ Limited resources/funds - causes low salary compare to for-profit
business
➢ Employee Engagement
 * Charitable nonprofit organizations shine a light on
Challenges - cont. what’s possible when people come together for the
greater good.

❖ Diversity, Equity, and Inclusion (DEI)

- As our population becomes increasingly diverse, the sector is not keeping up.
➢ 30 percent of the U.S. population is Black and/or Latino. Yet only 10 percent of
nonprofits are led by Black or Latino individuals.
➢ Only 4 percent of all philanthropy goes to organizations led by persons of color.
➢ only three of the top 50 charities in the nation have leaders of color.
Sample Case 1
A Native American-led nonprofit organization was recently up for a grant renewal. Its CEO

had hoped the process would be routine. After all, his organization had been a grantee of the

foundation for 25 years and part of the program officer’s portfolio for almost eight years. Yet he still

found himself having to defend his organization’s approach and its demonstrated success.

Meanwhile, one of the CEO’s white peers ran into the same program officer in a bar after a

conference and sketched out a three-year project plan on the back of a napkin. The white CEO

secured funding in three months. The Native American CEO’s turnaround time? Eighteen months.
Sample Case 2
Among organizations in Echoing Green’s Black Male Achievement fellowship, which focuses

on improving the life outcomes of black men and boys in the United States, the revenues of the

black-led organizations are 45 percent smaller than those of the white-led organizations, and the

unrestricted net assets of the black-led organizations are a whopping 91 percent smaller than the

white-led organizations—despite focusing on the same work.

Challenges - cont.

❖ Adopte of digital acceleration

➢ An increasingly crowded digital-first
environment.
➢ Limited resources/funds
Address the Challenges
 Solutions: Recruitment & Retention
● Formal recruitment & retention strategy
● Compensate employees fairly
● Improve employee training & development
programs
● Provide lateral and vertical growth
● Acknowledge & recognize employees for
their work
● Ensure work-life balance
Solutions: Finance

● Have appropriate methods of finance

tracking
● Prepare for & develop audits
● Attract & retain great employees
● Fraud prevention protocol
● Protect security of donors
● Increase awareness & support
 Solutions: Technology

● Embracing Technology:
○ Employee benefits
○ Social media, digital media and
data analytics
○ Engage volunteers
○ Supportive partnerships
○ Customer-centricity
Other Resources
 Resources

www.nonprofithub.org
www.freetechfornonprofits.org

www.councilofnonprofits.org

www.supportcenteronline.org www.impactfoundry.org
References

National Council of Nonprofits. (2021). What is a “nonprofit”?.

https://www.councilofnonprofits.org/what-is-a-nonprofit
The Future of Customer Engagement and Experience. (2020). https://www.the-future-of-
commerce.com/2018/04/16/how-technology-can-benefit-non-profit-organizations/.
ASU Lodestar Center for Philanthropy and Nonprofit Innovation. (2019).
https://lodestar.asu.edu/blog/2019/08/how-can-nonprofits-embrace-technology-achieve-social-impact.

https://donorbox.org/nonprofit-blog/nonprofit-employee-retention/
https://www.botkeeper.com/blog/how-to-overcome-top-nonprofit-financial-challenges
Activity
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1. Go to kahoot.it
2. Enter the Game Pin
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