Good Thoughts

Data disruption is a positive force for charities

Yesterday I had the pleasure of live-streaming Third Sector’s Big Questions Live debate. The panelists, co-founder of JustGiving Anne-Marie Huby, RNLI’s Leesa Harwood, and the director of international development at Prince’s Trust International Ruth Ruderham, discussed the latest Trends in Fundraising.

Digital disruption, disintermediation, data-driven supporter insight and delighting supporters in the increasingly competitive and noisy space were the main themes of the trends currently affecting charities.

  1. Crowdfunding. Every charity has a good cause but not every good cause is a charity. Digital technology has opened up fundraising to individuals. Just Giving predicts that within 3-4 years crowdfunding will be the main source of income for an average charity.
  2. Charity reviews. Just like they do with hotels and restaurants, people now review and look for reviews on charities. Platforms like Give Well research charity activities, impact and rank charities on cost-effectiveness and future prospects.
  3. Supporter engagement. Trust in charities, like most institutions, is going down (although the overall support is on the up). Supporters feel taken for granted and have low expectations. Charities that treat their supporters as investors are are able to surprise and delight them will stand apart.
  4. Data. That’s why Just Giving invested heavily in data science. Digital data is fast data which presents opportunities to understand supporters quicker and better, and close the loop by feeding back to them on the impact they are having.
  5. Data is also about measuring impact. As progressive organisations leading social change, charities should ask what metrics they should measure; what really matters not just now but in the future.
  6. Disintermediation and authenticity. Just like in the travel industry, digital is removing intermediaries in the charity sector. Donors can now speak directly to beneficiaries, unaided by fundraisers. There is also a filtration aspect, increasingly sophisticated and inundated by marketing messages, supporters filter out information that is not authentic.

Disruption is not always negative, it often presents opportunities for positive change. Charities should go back to basics and ask themselves “why us?”, “what’s so unique about our cause or our way of delivering on the need of the beneficiaries?”. Set metrics that matter and fit for the future, invest in data, measurement and understanding of supporters. Engage with supporters that will make them feel special. And most of all, take your staff on a journey by involving them in various teams, investing in training and development and fostering a culture of innovation. It’s all for a good purpose!