August 9, 2017; San Francisco Chronicle
Companies and nonprofit organizations alike are very interested in the Millennial Generation—by some reckonings, those born between the years 1980 and 2000—often pouring resources and effort into determining how best to engage this group. It makes sense; millennials recently surpassed baby boomers as the largest generation, numbering around 75.4 million Americans in 2015 versus 74.9 million boomers and about 66 million Generation X’ers. Importantly, this group is reaching what the Boston Consulting Group calls its “peak spending years” and nonprofits are vying for millennials to spend money on them in the form of donations.
Although non-millennials have characterized this generation as “entitled,” nonprofits would be beyond foolish not to learn how to interact with millennials as a donor pool, especially since they indicate that giving back to their communities and making the world a better place are priorities. The Millennial Impact Report from the Case Foundation and Achieve shows that cause-engagement and giving by millennials increased at the beginning of this year and continues to grow.
Several Connecticut nonprofits recognized early on that attracting millennials to their organizations would be critical to their sustainability and have taken steps to engage millennials in the ways they wish to be engaged. Juanita James, president of Fairfield County’s Community Foundation, says,
Millennials are very important. They are the next generation of leadership in every sector. Engaging them in philanthropy and the impacts it can have in addressing societal issues is incredibly important, but so is understanding what’s motivating millennials and how they want to think about philanthropy and not assume they are going to approach it the way previous generations did. We’re seeing millennials want to have a much more hands-on impact and connect with the work and understand the impact of the work. It’s a more active participation.
While millennials may be entering their peak spending years, they also tend to have less to spend, as indicated by the decrease in mortgages and increase in school loans. This is, perhaps, why many millennials offer their time and expertise to organizations and why nonprofits too often ignore them as an important donor segment. Thus, one giving trend to expect is microfunding, or the collection of many small gifts, which not only made a huge impact in the presidential campaigns of Barack Obama and Bernie Sanders, but also lends to the success of crowdfunding sites and peer-to-peer fundraising campaigns. The benefit of microfunding is that nonprofit organizations do not need to spend as much time on an individual donor, taking the risk of stewarding one person for thousands of dollars and potentially having the pledge fall through. However, the difficulty for nonprofits lies in creating content that leaves an impression on millennials without the assistance of in-person or phone conversations.
As millennials enter their peak spending years and enter into leadership in their respective fields, nonprofits need to determine a plan to best engage this generation. At the same time, however, organizations must continue to attract baby boomers and Gen X donors, as these individuals are looking into retirement and planned giving.— Sheela Nimishakavi