The 2018 Giving USA Annual Report on philanthropy reveals that, for the first time in history, American benefactors donated more than $4 billion to charity. Charitable donations serve an important function for nonprofit organizations and taxpayers. Since World War I, United States citizens have used charitable donations to decrease their taxable income. Today, almost 27-percent of taxpayers use charitable donations to receive tax breaks. Overall, American citizens donate 2-percent of their income to nonprofit organizations.
The traditional business model of nonprofit organizations makes running charitable groups a challenge. Of the 1.5 million nonprofit organizations in the United States, most do not utilize a competitive business model. Alternatively, these organizations depend on the kindness of benefactors, fundraising and grants. This leaves many groups struggling to raise funds by relying on inconsistent grants, donations and community fundraising events. An increasing number of contemporary nonprofit leaders, however, are adopting socially conscious business models to successfully champion community causes, and they are leveraging these enterprises to make positive and meaningful changes in society.
The following excerpts highlight 4 ways for socially conscious enterprise and nonprofit leaders to make organizations more successful in 2018.
Method 1: Know Your Audience
It’s vital that today’s nonprofit leaders have an intimate understanding of their cause and know how to market to potential donors. They must develop marketing communications in a way that resonates with the right people and promotes the ideals of the organization. The strategy of drawing on potential supporters’ emotions of sadness and remorse is not necessarily the best way to raise funds for a cause. Instead, experts recommend that nonprofit leaders pursue a different approach toward building support for an initiative. Compelling storytelling makes potential donors and volunteers amenable to new concepts, promotes self-reflection and increases one’s desire to commit their time and money to a worthwhile cause. Stories that inspire respect, pride and joyfulness are more effective for building sympathy and compassion for a civic undertaking.
Method 2: Utilize Data and Social Media Platforms
Cloud-based data repositories and social media information provides non-profit leaders with a wealth of resources for enhancing marketing efforts and improving organizational operations. These resources allow nonprofit leaders to enhance performance management, improve organizational productivity and maximize collaboration between staff members and volunteers. By better understanding how the organization works, leaders can clearly define roles, expectations and goals. Also, it’s important that nonprofit leaders include staff members in the development of plans. Collaborative planning results in realistic and quantifiable operational goals that align with the organizational mission.
Method 3: Network and Form Connections
Networking is vitally important for nonprofit leaders. This activity helps leaders build beneficial relationships with citizens, supporters and other enterprises. By connecting with professional peers and sympathizers, leaders exchange ideas and services while building positive relationships that support long-term organizational objectives.
Effective networking is a viable tactic for long-term sustainable growth. As nonprofit leaders build community connections, the reach of their influence and message expands.
Method 4: Stay Current With Tax Laws
Like their for-profit counterparts, fiscal responsibility is important for nonprofit organizations, and changing tax laws and policies are equally as impactful. Cash flow and financial planning are vital for optimal outcomes. The Tax Cuts and Jobs Act, for instance, has added complexity to the fiscal management of nonprofit enterprises. Many organizational leaders are unsure of how the new act will impact operations, making it vitally important to consult with financial experts, and be aware of tax saving opportunities. Staying current on laws can really help you plan your nonprofit’s business plan, and allows businesses to plan how to save money prior to taxes.
Method 5: Share Your Story
People are drawn to the “why” behind an idea. As a result, it’s critical that nonprofit leaders share their passion, why they’re cause matters and how the organization originated. Compelling stories help inspire people to understand and connect with a cause. By sharing their story, nonprofit leaders build followers, attract supporters and investors and get their organizations’ message seen and heard. Like all other brands, nonprofit organizations must compete with an ongoing barrage of media messages. Resultantly, nonprofit leaders must exhibit mastery in creating stories that capture the attention and evoke the passion of supporters.
Many people wish that they had more money. Despite this, more than half of American households donate to nonprofit causes. Among this group, most agreed to give a donation because a staff member or volunteer took the initiative to ask for a contribution. On a deeper level, these individuals chose to contribute due to their compassion and empathy. As a result, researchers have found that nonprofit leaders who effectively identify and touch on the emotional triggers of donors successfully lead their organizations toward long-term success and sustainability.