Nothing says ‘have a relaxing Sunday morning’ like a little talk about human psychology!!

Welcome to this week’s issue of The Fuel Tank.

So let me ask you all a question. When you got into fundraising and development, did you realize you were signing on for a lifetime of psychological profiling? Did you realize that knowing what makes people tick, and what makes them close off, was going to be more important than anything else you learned?

I recently wrote a post about an article that was shared with me about the psychological barriers to giving. The post was about how to both recognize and overcome those barriers in the nonprofit world.

But the person who sent it to me, who happened to be my sister, was asking how many of these barriers were present in buyers in my former world of B2B sales and marketing. My answer? Almost all of them.

You know why? Because the psychology of donors is not about philanthropy, per se. It’s about human nature. And human nature applies to just about every situation where there are, you know, humans interacting.

Below is the link to the original article on the National Center for Family Philanthropy website. It’s a really good read.

Now another question. Did you realize that everything you had previously thought you understood about donor psychology and behavior was going to change, and today the sector stands at a crossroads where doing things the old way will lead to sure failure?

As with every challenge, opportunity abounds, if you’re willing to make changes and embrace a new mindset. And that’s what I talk about below.

Now let’s get you all energized as we head into a new week!

The Challenge Draining Your Nonprofit’s Engine

There’s a Shift Happening: The Changing Mindset of Donors
Are you noticing changes in donor behavior and expectations that are hard to keep up with? Understanding the psychological shifts in why and how people give to charities is crucial for adapting your fundraising strategies to meet these new realities. We’re too quick to write off donor attrition or donor fatigue as a sign of the times or a function of people being buried in too much information. But the truth is that people of all ages and backgrounds have gotten seriously introspective and either have changing needs, or they’ve realized the hidden needs they had all along. Either way, considering action comes from emotion, and positive emotion results from finding a match for your needs, understanding the shift in psychological needs of your donors and prospects is critical for sustained success.

How it Might Break Down if Not Addressed

The Disconnect in Donor Engagement
The signs are not always simple to read. Reduced engagement, lack of responsiveness, ghosting, hesitation to answer questions or provide insight…but the impact hits you over the head like a sledgehammer. Smaller and fewer donations, lack of advocacy, donor attrition, alienated supporters… all resulting from fundraising strategies that fail to align with the current psychological drivers of philanthropy. Simply stated, if you don’t take the time to learn what’s motivating your donors today, the misalignment can severely impact your ability to fund projects and achieve mission goals.

Igniting Some Ideas to Rev it Up

Adapting to New Philanthropic Psychologies

1. Emphasis on Impact and Transparency: A study by the Indiana University Lilly Family School of Philanthropy highlights a growing trend among donors to seek tangible, measurable impacts from their contributions. Ensure that your communications clearly articulate the specific outcomes and impacts of donations. Humans today, more than ever, feel a burning desire to be part of something bigger than themselves. The need to FEEL it!

2. Desire for Personal Connection: According to research, modern donors are increasingly looking for a personal connection with the causes they support. Tailor your outreach efforts to create meaningful interactions with donors, possibly through storytelling that features beneficiaries or behind-the-scenes looks at your projects. That personal connection can extend to other donors, so be creative and provide opportunities for networking and community building. Don’t make it all about donations.

3. Increasing Importance of Social Influence: Leveraging social proof through testimonials, donor stories, and peer influence can significantly boost donation intentions. Show potential donors the community they’ll be joining, emphasizing the collective impact of their contributions. The younger generations specifically are more inclined to give to organizations where they have a personal connection, either directly or through someone they already trust.

4. Rise of Values-Driven Giving: Donors are increasingly aligning their philanthropy with their personal values. This requires nonprofits to clearly communicate their values and how these are reflected in their projects and initiatives. You could have the best mission in the world, but if it doesn’t match your donor’s values, success won’t be sustained.

Energizing Fundraising & Development Pros

Inspiring Innovation in Donor Engagement
Encourage your team to continuously explore and understand the psychological factors that influence philanthropy. Facilitate ongoing training in areas like donor psychology, behavioral economics, and effective communication. Recognize and reward innovative strategies that effectively tap into these evolving donor behaviors and preferences. Perhaps the most important quality of a great fundraiser these days is the ability to match their mission with donor motivation, values, dreams and aspirations.

(Shameless plug for Philanthropy Fuel workshops: ‘The Secret to Discovering Donor Purpose’ is a major module that we cover, including charting a course together focusing on matching motivations and achieving dreams and aspirations.)

Fostering a culture that values psychological insight into donor behavior will not only enhance your fundraising efforts but also make your team more adept at navigating the complexities of modern philanthropy. And understanding that this requires a long-term transformational view and not a short-term transactional mindset is a big win for your entire organization.

It’s Gonna Be OK - Here’s Proof

Converting Energy Into Action

Practical Steps to Align with Donor Psychology Today

1. Revamp Donor Communications: Reassess and redesign your donor communication strategies to emphasize transparency, impact, and the emotional resonance of contributions. Meet them where they already are.

2. Host Interactive Donor Events: Create opportunities for donors to engage directly with your projects and team, such as virtual tours, webinars with project leaders, or live Q&A sessions. Provide opportunities for them to grow, learn and interact with other donors as well.

3. Utilize Social Media Effectively: Share stories and testimonials that highlight the experiences of other donors and the direct impact of their donations, using platforms preferred by your target donor demographics. Remember the Double Impact mantra - you need to talk not only about your organization’s impact on the communities you serve. You also need to highlight the impact on donors who support your mission.

By understanding and responding to these psychological shifts, you can better meet donor expectations and build stronger, more meaningful relationships with them. And those relationships will pay off in more ways than just bigger or more frequent donations. People will want to get involved in many ways in your cause, they’ll want to talk about it, and they’ll want to be around for the long haul.

This Week’s Quote of the Week

People are complex! What drives them is constantly changing, but never more so than now. I find myself, and others I know, to be more introspective these days. Maybe it was the pandemic, or other world events, or just a changing landscape of what people value most. But it’s imperative to care enough to find out what that is for each person if you hope to forge any sort of meaningful connection.

And for those who take the position of being a matchmaker between hopes and solutions, the future is bright!

Enjoy the rest of your Sunday and have a wonderful week! And a very happy and healthy Thanksgiving to those who celebrate!!

All my best,
Dan

Please visit my website to see my expanded service offerings. I’ve been listening and learning from all of you in this sector and quickly realized there are more ways I can help those of you helping others!