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AFP State of Fundraising 2008 Final Report Released

Less than half of charities raised more money in 2008 than in 2007, and fundraising gains dropped significantly across the board, according the final report of AFP’s State of Fundraising Survey. The full report is available in the Members Only section of the website (login required) and has data about different types of fundraising, board giving and key issues affecting fundraising.

AFP’s eighth annual State of Fundraising Survey asked charities to compare their fundraising totals in 2008 to their figures in 2007. Overall, just 46 percent of organizations raised more funds in 2008, a new low in the eight-year history of the survey. In a typical year, about 60 percent of respondents raise more money compared to the previous year. The previous low was reported in 2002 when just 49 percent of organizations raised more money that year than compared to 2001.

In addition, the percentage of organizations raising less money in 2008 compared to 2007 (40 percent) was an all-time high. Another 14 percent raised about the same amount of money in both years.

The amount of money raised also dropped substantially. Of the organizations that did raise more money, nearly two-thirds saw increases of 20 percent or lower. In addition, just five percent of respondents reported fundraising increases of 50 percent or more. In comparison, just two years ago, almost one quarter (23 percent) indicated increases of 50 percent or more.

“Based on the survey results and anecdotal evidence from our members across the country, this is probably the most challenging environment that most fundraisers have seen in their lifetimes,” said Paulette V. Maehara, CFRE, CAE, president and CEO of AFP. “The dip in fundraising is particularly discouraging given the increased demand for services as many people suffer from the economy.”

Fundraising Predictions

Looking ahead to the rest of 2009, just 27 percent of fundraisers believe their organizations will raise more money this year than in 2008. About one-third of respondents (36 percent) estimate they will raise less in 2009. Thirty-seven percent predict they will raise roughly the same amount in 2009 as they did in 2008.

That level of optimism is the lowest by far in the history of the survey and represents almost a 30 percentage point drop from last year's survey where 57.5 percent of respondents predicted they would raise more money than the previous year. This continues a decline that began last year with a 10 point dip over 2006 survey responses where 67 percent of respondents expected to raise more money.

The number of respondents expected to raise less money than the prior year has increased almost three fold to 36 percent compared to 13.3 percent in last year’s study. The number of respondents who expect to raise roughly the same amount has also increased by seven points from 29.2 percent in last year’s study.

Most respondents pointed to the uncertain economy and their donor’s perceptions about the economic slowdown as a major cause for concern for future fundraising. “I think the most significant challenge to my organization's fundraising efforts will be consumer confidence in spending as a whole, but particularly the stock market trends and the overall economic woes facing many people,” said one respondent. “Even those whose incomes have not been affected by the economic crisis are being much more conservative in their spending, and philanthropy is one area that people can cut back.”  

In terms of strategy for 2009, a large percentage of organizations will be increasing their activities in major gifts, planned gifts, online solicitations and corporate and foundation grants. These activities are typically less expensive and/or focus on existing donors who already have strong connections to a charity. In contrast, very few organizations said they would be increasing their direct mail, telefundraising and special event efforts, which are typically more expensive and typically are used to attract new donors.

“Charities have been through difficult times before, most recently after the events of Sept. 11, 2001, and many weathered that storm,” said Maehara. “We must learn from those lessons and ensure that we don’t panic, but focus on the long-term and emphasize donor cultivation and stewardship. Make no mistake, this is a very challenging economy, but charities should remember that they still retain control over their circumstances. With the right planning, strategy and implementation, charities can overcome these challenges, and AFP is committed to providing resources to the sector to help organizations find success.”

Click here to access the full report (member login required).

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