With baby boomers and their predecessors making up well over half of all charitable dollars donated in the U.S., some nonprofits might not be aware of the incredible opportunity that’s right in front of them.
Though millennials, that segment of the population born between 1981 and 1996, account for a smaller portion of today’s charitable contributions, they are quickly gaining influence over the philanthropic landscape. And there is good reason for nonprofits to pay attention. Millennials are now the largest generation in the U.S. workforce, with the oldest members of the generation approaching age 40.
This group, who is set on making a difference in the world around them, is also on the cusp of an expected wealth transfer of $30 trillion, thanks to the savvy business and financial sense of some of their baby boomer parents and grandparents. That’s right. Over the next 30 years the most significant transfer of wealth ever experienced will be handed down to them.
The simple fact is, nonprofits failing to recognize the preferences of millennial giving risk missing out on a tremendous opportunity to engage these benevolent young individuals as lifetime donors.
So, what are some of the things that are unique to millennial givers? For starters, they desire to actively and physically participate in your cause.
Let Them Get Their Hands Dirty…At Least for Now
At this stage of their lives, millennials are more likely than other generations to donate their time rather than their money. With lower pay than previous generations and a lot of student debt, for the moment, this group has less disposable income than more established generations.
“Millennials are dealing with a lot of competing financial priorities. They are more willing to give their time than write a check,” says CAPTRUST Senior Director Grant Verhaeghe. “Creating a sense of ownership for millennials around a fundraising activity can be the first building block of an ongoing relationship.”
Millennials like something they can experience and that includes activities that promote fundraising. In the era of charitable half marathons, dance-a-thons, and overnight walks, this generation is seeking new ways to donate to charities.
“Millennials are getting more hands-on, participating in events that allow them both to volunteer themselves and raise money to support their endeavors,” explains Verhaeghe. Other events, such as cycling races and movie nights, can engage millennials and allow them to build some fun into the fundraising activity.
One well-known example of an experience-based fundraising challenge was a 2014 campaign to raise money for the ALS Association. As part of the challenge, more than 17 million people, including Bill Gates and former President George W. Bush, dumped ice-cold water over themselves in order to raise awareness about amyotrophic lateral sclerosis. The ALS Ice Bucket Challenge raised $115 million—twice as much as the charity raises in a typical year.[1]
Raising a windfall equal to double your organization’s annual budget, like the ALS Association did, can come with its own challenges, however. The ALS Association reports that they’re running a significant deficit right now, as they spend down the burst of money from the Ice Bucket Challenge.[2]
Also notable is that, not only did the challenge go viral, it was solely promoted through social media, with more than 17 million people posting videos online and 2.4 million videos tagged for the challenge on Facebook.[3]
Be Tech Savvy, Online, Mobile, and Social to the Max
There is no question, millennials are some of the heaviest consumers of social media. According to the Pew Research Center, a whopping 90 percent of them use it, and 51 percent of them use it to engage in causes they care about.[4] This generation also likes to use an array of digital platforms and social media to reach out to their personal networks and ask for help in fundraising. This includes Facebook, Quora, Twitter, Instagram, and LinkedIn, to name just a few.
“By engaging millennials online and through Twitter, Instagram, and other digital media, nonprofits can connect with a much larger network,” says Eric Bailey, a CAPTRUST financial advisor specializing in institutional fiduciary services for endowments and foundations. “It’s pretty clear, this generation uses social media to amplify their voices on issues that matter to them, and nonprofits should be taking full advantage of that.”
As Figure One shows, almost half of millennials who have given charitably like promoting organizations through their social media accounts. Additionally, millennials are twice as likely as boomers to follow a cause or charity on social media and nearly twice as likely to see social media platforms as an acceptable way to ask for a donation.
Figure One: Social Media Donor Engagement by Generation
Source: “The Next Generation of American Giving,” Blackbaud Institute, 2018
Peer-to-peer fundraising is another popular technology used by many nonprofits. “It’s a great way to get new donors and reach new networks of people,” says Bailey. This method of fundraising is a multitiered approach where individual fundraisers set up a personal fundraising page to accept donations, which are then received by your nonprofit.
“They essentially have their own websites,” says Brad Davis, executive director at WakeMed Foundation. “We will give them sort of a template and some boilerplate stuff, and then they can personalize it.”
This strategy makes use of your donors’ existing networks and encourages supporters to reach out to their peers, friends, coworkers, and family members for donations. “Peer-to-peer campaigns are effective because they build on relationships, use your already-existing donor base, and help build social proof,” says Bailey.
“Nonprofits absolutely need to use digital platforms to make a connection with millennials and clearly communicate their mission and needs,” says Bailey. “But that’s certainly not the only way to meaningfully connect with millennials. We’re also finding that millennials are active participants in corporate giving programs.”
Get Them Where They Work
Of working charitable givers, more millennials than any other generation are interested in workplace giving, and 40 percent of them have already participated in a workplace fundraiser.[5] This speaks to an emerging opportunity for nonprofit organizations to reach present and future donors where they are.
Workplace donations dramatically reduce administrative costs for charities. And automatic payroll deductions are one of the few opportunities for your organization to secure an ongoing, predictable source of revenue. In fact, more than 49 percent of nonprofit survey respondents identified workplace giving as a growth strategy for their organization.[6]
A charitable payroll deduction program has been successful for the WakeMed Foundation in Raleigh, North Carolina. “We raised about $800,000 last year from WakeMed employees at all levels, and they pay through payroll deductions, which is really cool,” says Davis.
However, according to Bailey, the options for employee giving may be limited to a preset list that would vary by company. The challenge for each nonprofit is figuring out how to be included on those lists of eligible nonprofits.
Nonprofits can get started by joining one or all of the organizations that set up payroll deduction giving campaigns at corporations. Some of these organizations are America’s Charities, EarthShare, and Community Shares USA.
Further, corporations appear to be doubling down on other ways to make a connection with millennials on the causes they care about. Employee volunteer and skills giving programs have steadily been moving towards the center of many corporations’ charitable initiatives over the past decade. Data show nearly 60 percent of companies offer paid time off for employees to volunteer, and an additional 21 percent plan to offer release time in the next two years.[7]
There are a variety of ways for nonprofits to team with corporations to effectively structure an employee volunteer program—such as day-of-service events, skills giving, and pro bono services. But organizations who want to successfully engage millennials in workplace giving or volunteering will also need a reputation of transparency and integrity.
Be Crystal Clear
Sixty percent of millennials say they are more inclined to give if they can see their gift’s impact.[8]
Millennials have higher expectations for organizations whose missions are to do good. “Today, people want to know more about a nonprofit’s goals, its impact, and the outcomes produced. Donors want access to detailed financial reporting, too,” says Verhaeghe. “Millennials want to know more about the differences a charitable organization is making before they contribute to its cause,” he adds.
Trust matters to today’s charitable donor. If a nonprofit organization doesn’t live up to a certain standard of transparency, it receives less in contributions than organizations that proactively provide data to the public.[9]
So it should come as no surprise that the characteristics of true nonprofit transparency are important to all charitable givers, not just millennials. For a deeper dive into the importance of transparency, see our article, “Transparent Reputations and Nonprofit Organizations.”
Nonprofit organizations that evolve with and effectively engage millennials will reap the benefits for years to come. Millennials are the individuals who have grown up giving and believe strongly that they can effect change in the world. But this can only happen if nonprofits meet this generation where they are and through the media they choose.
[1] Piper, Kelsey, “The Ice Bucket Challenge and the Promise—and the Pitfalls—of Viral Charity,” vox.com, 2019
[2] Ibid
[3] Ibid
[4] “The Millennial Impact Report,” themillennialimpact.com, 2018
[5] “The Next Generation of American Giving,” Blackbaud Institute, 2018
[6] “Charitable Giving Statistics,” nonprofitsource.com, 2018
[7] Ibid
[8] Chung, Elizabeth, “How to Engage Different Generations of Donors,” Classy.org
[9] Hrywna, Mark, “Accountants Prove Transparency Boosts Giving,” The NonProfit Times, 2019
