Have The Agitator and DonorTrends discovered the Fundraising Rosetta Stone … demystifing the real reason behind falling acquision and retention rates and other recent fundraising plagues? We think so.

In reporting our 2005 DonorTrends survey three years ago, we noted that Boomers had climbed to the top of the donor heap, surpassing Seniors (born before 1946) and Post-Boomers (born after 1964) in average annual contributions. In 2005, Boomers on average contributed $1361 over a 12 month period; Seniors — the traditional bedrock of giving — donated $1138, while the younger generations brought up the rear with $791.

Might this be the beginning of a "Golden Age" of Boomer giving we asked. Well, as it turns out … not quite.

In our recently completed and soon-to-be-released 2008 DonorTrends Survey, Boomers fell to the bottom of the heap — Seniors reclaimed first place, averaging $1542 in donations in the past 12 months, Newbies (our term for the Post-Boomers) jumped up to $1205 in donations (a percentage increase of 52%!), and Boomers fell to $1081.

What happened to the Boomers?

A new "must read" report by Pew Research, called The Gloomiest Generation, suggests the answer.

As it turns out, compared to both their predecessors and their successor generation, Boomers actually have the least optimistic view of both their current and future economic situation, even though in real terms they are the most prosperous. For example, Boomers give their overall quality of life a lower rating than other generations; they are more likely to worry that their incomes won’t keep up with inflation; they believe more than others that it is harder to get ahead now than it was 10 years ago; they are less likely to say their standard of living exceeds the one their parents had when their parents were the age Boomers are now; and not surprisingly then … Boomers are more anxious than other Americans that they will have to cut household spending in the coming year because money is tight.

This adds up to a pretty gloomy head trip! Might it cause a more conservative approach to donating — even a retrenchment? In our opinion…Absolutely.

Pew suggests a few possible reasons for Boomer gloom.They note that substantial percentages of Boomers are in a "sandwich" phase of life — many are financially supporting their parents, their own children in the home, as well as adult children outside the home — at the very time they are beginning to contemplate retirement and living on fixed incomes. Also, Pew finds seven-in-ten Boomers dissatisfied with the direction in which the country is going, a worse assessment than other generations. The DonorTrends 2008 Survey, to be reported fully soon, probes Boomers’ issue attitudes in detail and finds the same concerns.

But taking their gloom into account, and noting the fall-off in their average giving, we still need to remind ourselves that Boomers numerically dominate the donor universe … so target them we must!

Fundraising Implications Today and Tomorrow. Make no mistake. When the largest and most wealthy generation of donors is in a near-Prozac stage and scared to death of their financial future in a society they perceive is going to the dogs, it’s not good news for fundraisers.

Acquisition suffers because they’re reluctant to make new commitments. Retention suffers because the generally skeptical nature of Boomer generation is turbo charged by fear of the future … and perhaps the perception that the world’s problems are getting solved after all, despite Boomers’ original idealism. In short, they’re skittish, disappointed, and they bail far more quickly than either the Seniors or the Newbies. Is it any wonder acquisition and retention rates for many organizations hit the downward skids at the same time the Boomer generation succeeded the blindly-loyal Seniors as the majority of America’s donors?

And rising gas prices, food prices, and health care costs merely exacerbate the giving malaise.

In short, fasten your fundraising seat belts! This is about more than a temporary economic downturn.

Roger and Tom

P.S. In the DonorTrends 2008 Survey on Generational Giving, available shortly, we’ll set forth actionable recommendations on how to survive and thrive in this sea of depression afflicting America’s largest group of donors. Meanwhile, download the Pew report and stay tuned to The Agitator. Roger & Tom

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