Nonprofit Hub Radio
Whether starting a nonprofit or taking an existing cause to the next level, The Nonprofit Hub Radio Podcast is about breaking down how nonprofits can grow. Each episode features an interview with a sector star with insight, stories, or ideas that can take your nonprofit from good to excellence. Join host Meghan Speer every week to make your good go further!
Nonprofit Hub Radio
Unlocking Philanthropy's Future: Engaging Generations and Elevating Nonprofit Impact
Discover the untapped potential of modern philanthropy with Meghan Speer featuring Rick Dunham, founder and chairman of Dunham Company, as we unravel the myths surrounding generational giving trends. Contrary to popular belief, younger generations, including Gen Z, are showing a vibrant engagement in philanthropy, though in diverse and innovative ways compared to their predecessors. Rick shares fascinating insights from the Generosity Commission's report, shedding light on how nonprofits can harness the synergistic power of giving and volunteering. He offers practical strategies that can help organizations, especially those like food banks, drastically cut operational costs and increase donor involvement by engaging them as volunteers.
For over four decades, Rick Dunham has been at the forefront of marketing and fundraising for Christian nonprofits. In 2002, he founded Dunham + Company, which has become a global leader in providing multi-channel strategies across some of the world’s most influential sectors. Through radio and television, local churches and overseas missions, medical relief and philanthropic initiatives, Dunham + Company is multiplying the reach of the gospel. The company currently serves nearly 100 clients in the United States, Canada, United Kingdom, Australia, and New Zealand – whose collective effort is reaching nearly every corner of the globe. He serves as a member of the board of The Giving Institute and is a former chair of the Giving USA Foundation, which publishes the most widely respected annual report on giving in the U.S. He has been published and quoted in the Wall Street Journal, USA Today, Washington Post and more.
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Speaker 2:Welcome back to the Nonprofit Hub podcast. I'm your host, megan Spear. Host Megan Spear joined today by Rick Dunham, who's the founder and chairman of Dunham Company and who brings decades of experience to helping organizations increase their impact across all of their channels, especially through fundraising. Super excited to have Rick on today with all of his wealth of information, but specifically in his role with the Generosity Commission, to talk about the new report that they've just put out. So, rick, welcome to the show. Thanks for being here.
Speaker 3:Thank you, great to be here.
Speaker 2:So tell us a little bit about the Generosity Commission, for those who might not have heard of it, and then we'll dig into the report of what you all have found recently.
Speaker 3:Sure. So the genesis of this is there's an association called the Giving Institute. Next year it'll turn 90. It started as the American Association of Fundraising Council back in 1935. And the Giving Institute is the group that ultimately started publishing GivingUSA and then set up the GivingUSA Foundation. So GivingUSA is the longest running report on philanthropic giving in America. It's the gold standard for a lot of practitioners to understand the longitudinal data around giving in America. Dunham Company has been a member of the Giving Institute since 2010.
Speaker 3:I served as chair of the foundation board and during that time we began conversations around the need for a new commission on looking at philanthropic giving. Back in the 1970s the Filer Commission did something very similar to this. So, really coming out of we set up a working group and that working group eventually became the steering committee for the Generosity Commissioner and there were a number of leading thinkers around and practitioners around philanthropy. So Rockefeller Foundation was involved, Candid was involved, A number of other organizations. So the goal was to take a really hard look at the trends in philanthropy in America and the expressions of generosity, and the commission itself really focused in on the giving to nonprofit organizations. The trend has been that and you'll see in the reports that the amount given every year has gone up but the actual participation rate by households in America has gone down. So they're trying to understand that dynamic and what really is at play and what's impacted that. So that was the purpose of the commission and then, obviously, the report, which looked at nine different recommendations.
Speaker 2:Okay, so let's start there. I think one of the things that I think was so interesting in the report itself is around younger generations. Right, there's all this talk about younger generations not caring and they don't want to be involved. They're not going to be doing things the same way. Takeaway from the report was around how to about the fact that we shouldn't be ignoring those Gen Z folks and getting them involved. So let's start with that. Talk to us a little bit about some of the findings there in general and what the research was showing.
Speaker 3:So obviously this is. It's really interesting to me because this is actually what was the narrative around millennials five, seven, eight years ago. Sure, sure, yeah, millennials I'm old enough to remember that when this was, the boomers, when they're at the same stage of life, face the same kind of narrative that they just aren't going to mirror the same generosity as the older generation. Charities are going to be in trouble and, of course, the report found just the opposite and our own research shows the same thing is that younger generations are highly motivated around volunteering and giving. It just may look a little different than what we're used to, and I think that's part of one of the findings of the report. A recommendation was to take youth seriously, as both givers, even some of the most recent reports, show that they're trending more conservative than many people thought.
Speaker 2:So talk a little bit about that connection between giving and volunteering.
Speaker 3:Okay.
Speaker 2:Because I think that's an interesting piece of this as well. Generosity doesn't have to just be financial as much. Obviously, an organization needs money to function, but generosity is a much broader term, and I liked the connections of volunteerism in this, so let's talk a little bit about that.
Speaker 3:Yeah.
Speaker 3:So, and I think that's why they looked at both giving and volunteering, because volunteering does have a financial impact on an organization when they can forego paying somebody to do a certain function and having volunteers come in and do that work.
Speaker 3:So it is an important part of generosity. So what we've seen over the years and there's a number of studies around this is that when you have donors who also volunteer, they have the highest lifetime value. They're the ones that are most engaged and committed. So many organizations, as a result, focus not just on getting the donation but giving opportunity for those donors to become involved in volunteering. Then you do have those who volunteer their time and that is their contribution, and I think obviously it really depends on the kind of organization. But we've got one ministry that we've worked with for 20 years and they have a very sizable volunteer group that does a lot of. Actually, when we do mailings and stuff, they're the ones that have stuffed the packages and done a lot of the manual labor that normally would have cost that charity quite a bit of money.
Speaker 2:Yeah, so when it comes to those volunteers and that connection, are there takeaways that we have seen about whether it's in the report or just that you have seen over the years that are strategies for folks to engage volunteers and move them to donors, or who can get the donors to be more active as volunteers?
Speaker 3:Yeah, so what I've seen over time is that it's rare for those who volunteer initially to become donors. Normally those who initially volunteer the majority that is their contribution. But what we have seen high success on is having donors be given volunteer opportunities and getting them to engage deeper, because obviously and it's so different depending on the kind of organization- Sure.
Speaker 3:So for some organizations there are a plethora of opportunities for volunteerism. What I think of there would be a food bank or a rescue mission or something like that, where there's a number of things that volunteers can come in and do. Obviously, habitat for Humanity has built a whole nonprofit off of volunteerism. So there just aren't that many opportunities because, for instance, we work with a number of what I would call content-based ministries. They have very little opportunity for volunteerism. So it depends on the kind of organization you are.
Speaker 2:But the more you can get people donors involved in volunteerism, the higher likelihood that they will stay with you over time of organizations talking about lately is the idea of and especially maybe more on that, because you and I cross over a lot on that content-based ministry side. Is turning those donors or that community into online advocates right and encouraging them to be sharing the content that you're putting out and to be making referrals and bringing other people alongside and into the ministry? Is that something that the Generosity Commission has looked at? Also, outside, we have physical donors. We have actual volunteers. Has the social media influencer or social media kind of advocate started to make a play in generosity as well, or we're not quite there yet?
Speaker 3:They're not quite there yet they did talk. They did. One of the findings and one of the recommendations was to encourage public figures in a broad range of fields to become advocates of the organizations they support and be vocal in terms of what they're doing and encouraging others to become involved. It's what we're calling a little bit the national conversation coming out of the Generosity Commission. How do we spread through our networks the opportunity to become involved in charitable activity, whether that's giving or volunteering? But the Generosity Commission didn't drill down deeply on that one.
Speaker 2:Yeah, I think that's part of the ongoing conversation. Right, yeah, I think that's part of the ongoing conversation. Right is, how do we move people from deeper into relationship with the organization? And some of those online advocacy options I think are going to be especially as we talk about Gen Z and Gen Alpha coming up are going to be more and more critical. So I'm excited to see where that conversation plays out. The other thing that I thought was so interesting out of the commission report was the I don't know if it's a recommendation necessarily, but on getting businesses to encourage generosity within their employees. Talk about that and that kind of that finding and then what the next level would look like for that.
Speaker 3:So yeah, I think one of the goals coming out of the generosity commission was to have businesses culturally embrace the idea of giving and volunteering and encouraging employees to be more engaged as a result, and I think historically, a number of corporations this goes back many years set up matching gift programs as just one example. That would encourage employees to give and the corporation would match that gift up to a certain amount, and I think it's that kind of behavior is what they're really encouraging, because obviously that then encourages more participation in charitable giving and volunteering.
Speaker 2:Is that something that you have seen? Something that you have seen and there's many organizations, obviously, that offer United Way and you can pick your particular nonprofit through that, or they have other programs that they're working through. Is that something where nonprofits could take the lead and be reaching out to these, like to local companies in their area or to companies that might be vendors of theirs, to help support that? Is there a nonprofit way to help drive those, or does it need to be driven by the business itself?
Speaker 3:Yeah, I think the latter mostly, and one of the things. There's two points I would make. One is what is the proper target audience for you as an organization, as a donor audience? What's that profile of donor that's most likely to support you? As a donor audience, what's that profile of donor that's most likely to support you? And secondly, when we look at corporate giving, it has been at 5% of the total charitable pie for decades and has not moved. So I would much more encourage organizations to really understand better who their current donors are and how can I find a mirror of that audience to approach?
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Speaker 2:Are there things that leaders can do? I know we have a number of folks who listen to this podcast who are maybe not necessarily running nonprofits, but they're in the vendor space that helps to serve those. They're leaders in their own businesses, right, who are helping to serve those organizations. What are some things that those leaders can do within their organization to build that culture and to encourage that amongst the people that they lead and the employees that they have?
Speaker 3:Yeah, I think a number of ideas that people have talked about and things I've seen is corporations setting up a volunteer day where they allow employees to go out and volunteer in the community and to engage local nonprofits there's a number of corporations I know embrace that kind of behavior. The second one is what I just mentioned, that corporations set up a matching program that lets employees know that you're going to match whatever gift they give up to a certain amount. So I think, again, it depends on the kind of organization you are, corporation you are and your role in the community, and I've caught a lot of faith-based organizations connecting with and volunteering with even the local church. So, yeah, those two ideas alone I think are worth pursuing as a corporation.
Speaker 2:Yeah, and this is one of those examples where where the top-down leadership matters, because it's one thing to just say like give it lip service, for example, but when they see that modeled and when we're invested like you can see investment from the company, you can see the day off all of the to go volunteer, those kinds of things when you can actually physically see that those things matter to the leadership, I think that makes a big difference as well. Absolutely, I'm curious to know from the report what stood out to you most. Was there anything that surprised you in the data? What was your kind of biggest takeaway from it?
Speaker 3:I think the research that was done. That is the background to the report and to the recommendations Back in 2017, the Tax Cut and Jobs Act was created at the very end of 2017. One of the unintended consequences of that was to double the standard deduction and one of the unintended consequences of that was a drop in participation rates. So one of the unintended consequences of that was a drop in participation rates. So one of the studies that was done from Indiana University came out Lilly Family School of Philanthropy. They came out with a study that showed that, basically, the doubling of the standard deduction probably costs around $20 billion in lost revenue to charitable organizations. So one of the most deduction probably costs around $20 billion in lost revenue to charitable organizations.
Speaker 3:So one of the most important things I believe coming out of this has to do with public policy and the use of the charitable tax deduction. So, knowing that the standard deduction is probably not going to change, one of the things that's being worked on the Hill right now and we're actually, as a company, involved in this is advocating for a law, new legislation, that would enshrine a universal charitable tax deduction. So that would be above the line deduction. Before you get into the other itemizations and what I know what's being talked about are a cap of maybe $4,500 for singles and $9,000 for couples filing jointly, but I think the impact of that would be to stimulate more charitable giving, more participation in charitable giving.
Speaker 3:Yeah, charitable giving and every study that we've ever done, every test we've ever run, having the potential to get a tax deduction for charitable contribution does stimulate giving and especially stimulates the amount people tend to give. So, anyway, to me one of the most important things being worked on coming out of this whole thing is the work on that universal charitable deduction.
Speaker 2:And is that something right now that people listening can call their representatives over, or how do they help support that work that's happening right now?
Speaker 3:So Senator Lankford is working on this on the Republican side I forget who's on the Democrat side and that bill's being worked on and I think it will probably be put forward in the first quarter of next year is my guess, no later than second quarter. I know they want to move fairly swiftly on it.
Speaker 2:Yeah.
Speaker 3:I would just I would keep your eyes and ears open. We'll obviously be reporting on that when that bill is presented. We're definitely going to be communicating on that.
Speaker 1:I would think yeah.
Speaker 3:And that's when we'll want people to contact their representatives, their senators, to really encourage support of that bill.
Speaker 2:Yeah, that's exciting, though. It's always encouraging to me to see work happening that's going to support the cause of generosity across the board. I think that's fantastic. Okay, so a lot of our audience tends to be from some smaller organizations. The shift in generosity that you're that we've maybe shift is the wrong word, but this, the amount of people getting involved in generosity when it comes to some of those smaller organizations. When it comes to some of those smaller organizations, when they are relying so heavily on donors, especially in the local community, are there actions that they can take to get more people involved? I guess my question would be what would be your recommendations to help them fill the top of the funnel and get more people involved? Is it changing in messaging? Is it? What's our approach? Are there things that we could be doing to help move the needle on how many people are connected to nonprofits, even if it's at a small giving level, not major? How do we help them encourage generosity and engage more folks?
Speaker 3:Yeah. So where I start in this is how well are you actually stewarding the relationships that you currently have? Too many organizations are focused on how do I get more donors, but that actually that's important, but not as important as stewarding those relationships once you have them. So what does if a donor, if somebody comes to you and donates for the first time, what does that journey to them feel like? How am I actually being drawn more deeply into that relationship? And what's stimulating ongoing support? Because getting a donor is great, but keeping them is more important, because we can show in the data that for every year that you keep a donor, they give you more money. So retention really is the North Star of fundraising. So that's where I go back and say okay, have you had an honest internal audit of your donor engagement process, looking carefully at those steps that a donor goes through to ensure that not only that you get the first gift, but you get the second and the third gift and that you're keeping them over time? So what does that? What's the cadence of communication look like? So what does that, what's the cadence of communication look like and I know there's a lot of organizations that still hear this that well, we've acquired this donor so we're not going to bug them for a while.
Speaker 3:No, the most likely donor to give is the one who just gave to you. So how quickly are you going back, not only just with thank you, which obviously is very critical, but what are you doing to give them an opportunity to make another investment in your organization? And then again, a lot of organizations are fearful of over-communicating donor burnout. I don't believe there's a thing called donor burnout. I think what there is is irrelevant communication. When donors give to you, they're giving to you because they have an interest. The question is, how do you leverage that interest in your organization in a way that's relevant to the donor and keeps them engaged and keeps them giving? So I really think the first order of business is to ensure that your donor ecosystem is built in such a way that donors are being retained. You're optimizing that for donor retention so that, as you do go out and engage more donors, you can have confidence that they'll stay with you over time.
Speaker 2:I so appreciate the message that you just put out there in terms of donor burnout. We just were having this conversation. I put it on LinkedIn last week because I received an email from an organization that I have supported for probably five years now, the gist of which it came from the chief development officer. The gist of the email was basically hey, our staff is really burnt out, and we're sure that you're super burnt out as well, so this is our only year-end appeal email. If you'd like to give us a gift, here's the link. Wow, and it inspired no, not anything. All I sat there thinking was are you going to actually do the work that I'm giving you the money to do, or are you just taking the whole rest of the year off.
Speaker 2:Yeah, like really the messaging around that, that I understand if your staff is burnt out, but let's not assume that the donors are as well exactly right that I think. So often we make assumptions about what donors are thinking, so really appreciate that. Call out that they're not burnt out. They're getting 17 emails a day from other people.
Speaker 3:Exactly right.
Speaker 2:Let's not paint them in a box or stick them in a box and assume we know what they're thinking. Yeah, that email really definitely proves the point of what you just had to say. Right Gosh, what a strange email that was. Plus, you and I both know one email is not going to cut through the noise.
Speaker 3:No, it sure isn't. So that's where part of as you think through again your donor communication strategy and your ecosystem, the inbox of today is the mailbox of yesterday.
Speaker 2:Yes.
Speaker 3:So before the internet? I know some of you can't imagine that, but before the internet, when mail was a primary way of communicating, your mailbox was chock full every day and standing out was really challenging. Well, that's the inbox today, so it's pretty presumptive to think that you're actually going to cut through in an email.
Speaker 3:Therefore, you need to make sure that you're really strong on all channels of communication, and one of the data points that we're seeing that I think is super interesting is that direct mail is actually increasing in preference among the younger generations. They want direct mail.
Speaker 2:Really.
Speaker 3:Yes. So, and I first saw this a couple of years ago I was talking to some of our millennial employees they go, yeah, we never get anything. It's so much fun to go to the mailbox and actually get something. And so actually seeing, literally, the younger the generation, the higher the preference for direct mail and over the last few studies that interest has only increased. So it doesn't mean that they're going to write you a check because they don't own a checkbook, probably, but over 50% now are saying that when they get direct mail they love to go online to give, and only 27% say that they'll write you a check. So my whole point in all of this how are you connecting with your donors through multiple channels becomes incredibly important. With your donors through multiple channels becomes incredibly important, and a mailing program is, I think, vital for any organization because you have a very good chance of being only one of two or three things that show up and if they're a supporter, they're going to want to open your mail.
Speaker 2:Yeah, that's great. Rick, I want to ask just as we wrap up here, obviously as someone who has been deeply involved in the nonprofit world for all of your career, as far as I know what inspires your own approach to generosity and how do you like that's been such a passion point for you. So what inspires that? And then how do you hope to model that to the folks at your company and who are impacted by the commission? What does that look like personally for you?
Speaker 3:Yeah, I think it's when you see it's really what we even coach our clients on it's when you see the outcomes of an organization that are significant so that when you make that investment, lives are truly going to be transformed, investment lives are truly going to be transformed. So when I look at our choice of generosity, we're really focused on outcomes. We really want to make sure that the organizations we support my wife and I support can have demonstrated outcomes in transforming lives and because, at the end of the day, that's just not why we give, but it's really truly why donors give. It's really interesting.
Speaker 3:We did a study among P1 listeners, so those that have a preferred station, so that's a P1. So they're the most engaged in listening to Christian radio. So we did this study on them and we asked a number of questions, two of which were why do you listen? And the response was what's in it for me, encourages me, it's positive. Then we asked the question why do you of the donors, of the P1 donors, why do you support the station? And the top three answers were totally related to the mission, related to the mission gospel single, I mean. So there had been an assumption in the industry that because listeners tune in for what's in it. For me, that's why they're going to give and it's not true. They give permission and I see that over and over and every single donor study we've done is donors are concerned about outcomes and about mission, so what I'm looking for is what organizations deliver on their promise and the outcomes that are significant.
Speaker 2:That's such a shift in messaging from what we see to your point, with what we see a lot of folks putting out so often the solicitations I get or the organizations I support. We're talking about the impact to me, right Partner with us and it'll make you feel good to be a part of this, instead of showcasing what they've actually done. So to me, that's a huge takeaway from our conversation and the commission in general, the report in general, our conversation and the commission in general, the report in general. That is something that has to be looked at as we come into 2025 is how are you actually showcasing what your organization has done this year and how are you crafting your messaging around that to move the organization forward?
Speaker 3:It's about the story of those lives being transformed. Can you demonstrate that clearly?
Speaker 2:Yeah, I think there are far too many nonprofits at this point who would have a really hard time with that.
Speaker 3:Yep, I agree.
Speaker 2:Do you think that negatively then impacts the moving the needle on generosity? Has that been a negative impact for it?
Speaker 3:Absolutely, absolutely. There's a couple of other underlying trends generally that have affected generosity, where there's been too much of a focus on high net worth individuals and giving it that higher level and as a result, it's pushed to the side that lower donor, that broad-based mass donor approach. So it's got to be both and it can't be either or yeah, Okay.
Speaker 2:So last question, as we wrap up what is your number one on the list of recommendations that have come out in this report? What is the one that really, if an organization has to start somewhere, this is the one that you want the takeaway from it?
Speaker 3:Yeah, I think not necessarily coming out of the report, because the report is really dealing with macro issues. So if I'm really as an organization, I'd probably circle back around to what you were just saying. Even as you move into 2025, how well are you actually telling your story? What resources are you putting into place to gather the stories from people whose lives you're impacting and how well can you actually tell that story? Because, at the end of the day, that's what people are ultimately going to support? And then how do you showcase that in your email and direct mail, et cetera? So, so and I, yeah, I I agree with you is that most organizations have not valued the gathering of the stories to tell, to show donors what their support is actually doing, and that would, if I had one recommendation, make that a commitment in 25.
Speaker 2:I love it. So if somebody wants to dig in more and read the generosity commission report for themselves, or find out more about the giving Institute and the work that you all are doing, what's the best way for them to connect with all of that information?
Speaker 3:Uh giving instituteorg? Um, definitely, if you go to giving instituteorg, you'll see it there as well as uh giving USAorg either one of those and you should be able to find the report there. The subscription is pretty cheap it's like $159 a year and you get not only their annual report but the special reports on donor advised funds, legacy giving. There's a lot of content there that can be super helpful.
Speaker 2:That's great. Well, rick, thank you so much. We appreciate you and all of your work on the cause of generosity, and thanks for taking the time to be with us today.
Speaker 3:Thank you, Megan.
Speaker 2:My pleasure Again. My guest has been Rick Dunham, who's the founder and chairman of Dunham and Company. Find out more at givingusaorg. Thanks for joining us so much. We'll see you next time on the Nonprofit Hub Radio podcast.