It’s easy to make assumptions about why donors stop giving. But do we know the actual reasons this happens? A recent study from the Wise Giving Alliance at Give.org called the Donor Participation Report surveyed over 3200 adults across the US and Canada, and this was one of their questions.
While a question like this is admittedly difficult to ask or answer honestly, because we often don’t really know why we do the things we do, the results of the survey nevertheless provide some striking insights into donor behavior. It gets even more interesting when you factor in generational differences for why donors stop giving.
So, let’s take a look at the statistics from the study for reasons why donors stop or decrease their giving.
Can’t Afford to Keep Giving
This was the most cited reason for stopping or decreasing giving, by far, with one exception as you’ll see next. And this is true for all four generations in this part of the study – Boomers, Gen X, Millennials, and Gen Z.
77% of Boomers who stopped giving cited this as one of the reasons. 48% of Gen Xers and Millennials gave this as the reason, and 27% of Gen Zers did.
Though the wide variations across generations are noteworthy, the fact is, many people stop giving because they simply can’t afford to keep doing so. This is one reason to prioritize major donors over low-dollar donors.
What’s interesting to note here is that older people tend to be the more generous and loyal donors. At the same time, older people also stop giving most often because they can’t afford to. So we see two clear groups of older donors.
Didn’t Feel Like They’ve Been Asked
Gen Z offers the one exception to the reason just given for stopping giving to charity. 45% of Gen Zers said they stopped giving because they didn’t feel like they had been asked. For all other generations, fewer than 10% gave this as a reason. So the outlier among younger donors for this issue is staggering.
What does it mean?
It suggests a lot of younger donors start giving, or even give just once to an organization, but then hear nothing and get asked for nothing beyond that. So, they don’t follow up with ongoing donations.
Drawing younger donors into your mission may not be easy, but for the ones who start giving, it’s a terrible loss of future revenue potential to let them walk away simply because they feel ignored.
Don’t ignore your newer and younger donors, even if they don’t give in large amounts. These people will gain wealth over their lifetimes, and they will keep sharing it with your organization if you sustain your relationship with them. Don’t neglect younger donors.
Prioritize Spending on Family
27% of Boomers and 21% of Millennials said they stopped giving to charity because they decided they needed to spend more money on their family.
There’s not much you can do about this if this is the reason you lose a donor, especially if that spending involves things like cars, college, day care, and other large costs of having children. Sometimes, it’s just not the right time in a donor’s life for them to be giving to charity – especially major gifts, but even smaller ones too.
Don’t Trust the Charity
23% of Boomers and 18% of Gen Zers said they stopped giving to charity because of trust issues. This is about communication. Sincere, honest, timely communication that shows how a donor’s gift is being used and making a difference isn’t very hard to do, but far too many nonprofits fail to do it consistently.
You can never get too complacent about thanking and following up with donors. Why? Because each donor is their own person. And each person wants to know their money is being used to make an impact in the world, in a cause they care about.
They wouldn’t have donated at all if they didn’t care, at some level. They want to know their gift mattered. If they don’t get that feeling, they will struggle to trust you for future gifts.
Don’t Feel Connected to the Charity
This one is similar to the last one, and the way to prevent it is the same – consistent and timely communication.
30% of Millennials and 27% of Gen Zers said they stopped giving because they didn’t feel a connection to the charity. In other words, they gave, but they don’t feel acknowledged, valued, or drawn in. They feel anonymous and that their gift got lost in a sea of activity, and they don’t see a tangible outcome they can feel good about.
If you put these two reasons together, three of the four generations have sizable numbers of people who are stopping or decreasing their giving because of a lack of trust or connection – a failure of communication.
Prefer Other Ways of Being Generous
Sizable numbers of all four generations, ranging from 8% to 24%, said they stopped giving to charity because they decided they’d rather be generous in other ways. This could refer to volunteering their time, giving physical items instead of money, or various other types of generosity.
And this is fine, because different donors are wired differently. The key for nonprofits is to try and keep donors like this involved in their organization’s work, because if they stop giving money, their ongoing participation can still advance the mission. It can also result in friends, family, and coworkers being drawn in to help, and some of them may become financial donors.
An active non-donor who is great at networking can still be a major source of revenue.
Didn’t Think the Donation Made Much Difference
18% of Gen Zers listed this as a reason for stopping giving. This is, yet again, due to a failure of communication. Donors should always know that their gift made a difference. If they don’t, that means the charity has failed to help them see the impact they’ve made.
It’s also interesting how many of these reasons to stop giving are being cited by Gen Z over all the other generations. While respondents were allowed to select more than one reason, recall that only 27% of Gen Zers said they stopped giving because they couldn’t afford it. That’s one reason you see them identifying so many other reasons in sizable quantities.
Gen Z wants to hear from you if they’re going to keep giving. They want connection. They want trust. And they want to know they’re making a difference. This is how you win younger donors.
Lesser Cited Reasons
A variety of other reasons to stop giving were offered to people who took this survey, but they received lower responses. Still, some were cited by over 10% of certain generations. Here’s a quick look at these responses, with the generations listed who chose that reason at rates above 10%:
- Afraid the charity will not stop asking for money (Boomers and Gen Z)
- Charity doesn’t seem to value or need my contribution (Gen Z)
- Donating doesn’t appeal to me (Boomers and Gen X)
- The charity is not politically aligned with me (Gen Z)
Insights about Wealthier Households
What about wealthier households? You don’t have to be rich to give generously to charity, and many mid-level donors are not wealthy. Just generous. So, the survey included a couple additional questions they asked only of households that make more than $70k in income. So again, these are not all wealthy households. But they’re doing well enough to be reliable and generous donors.
Among these households who stopped giving in the past five years, 35% said they did so because they could not afford to give. This compares with 51% overall for the survey. So, affordability is not as big of an issue for households with more income. But still, 35% is a large number. Big expenses can remove households with more income from the donor pool.
17% of these households said they:
- Preferred other ways of being generous
- Did not trust the charity
- Felt like they hadn’t been asked
This 17% figure is comparable to the overall study for all three of these categories. This suggests that households of all income types fall into these three categories at about the same rates. They want connection. They want to hear from you. They need to know their giving matters.
For households with over $70k in income who decreased their giving – rather than stopped it – even more than 17% listed these reasons for the decline, except for not feeling asked, which was chosen by only 7%. But, 19% also said they decreased their giving because they didn’t feel connected to the charity.
So whether we’re talking about trust or connection, households with more income are the same as all other donors. Sizable numbers will stop or decrease their giving if nonprofits do a poor job of communicating the impact of their gifts.
Comparing Charity to Business
A final question along the lines of this theme asked people what they thought makes a greater impact on society – socially responsible businesses, or charities.
This is valuable information because it shows how different donors perceive charities and the work they do. Donors who feel socially responsible businesses have a greater positive impact in the world probably will not become big donors to charity. Or if they do, they’ll be harder to retain as loyal and recurring donors.
It’s not surprising then that 58% of donors who increased their giving also believe charities have a greater impact than socially responsible businesses.
Only 25% of donors who stopped giving believe this, and 38% of donors who decreased their giving believe this. So there is a clear differentiation here based upon how much confidence a donor has in the ability of a charity to do great and transformative work.
This is one reason people stop giving, and there’s not a lot you can do it about because it seems to be a core belief that drives the decisions they make. But it’s important to understand this so you will better understand your donors.
Generationally, older generations are more likely to believe donating to charity has a greater positive impact on the world than shopping at socially responsible businesses. Here are the percentages of donors from each generation who believe this:
- 52% Matures
- 51% Boomers
- 41% Gen X
- 39% Millennials
- 37% Gen Z
The trend is obvious. And it’s quite possible that as people age, their thinking about this issue changes with it. Perhaps they feel like businesses are more temporary, whereas the work of charities has longer-term impact, and as they age they want to make a bigger impact.
Either way, it’s worth knowing that older generations place greater trust in charities to do great work, and this is one reason you can continue to approach older donors with confidence.
