Every nonprofit is likely to be affected by the economic impact of the global health crisis. Many individual and corporate donors will be dealing with their own financial challenges, making it more difficult to contribute. The same will be true of governments, which will face declining tax revenue as a result of economic recession. 

Despite these challenges, nonprofits’ missions remain vital, and demand for programs and services has not necessarily decreased. In fact, in many cases, it has drastically increased.

How can nonprofits prepare for and adapt to potential revenue drops?

In the short term, nonprofits are wise to exhibit creativity in redesigning in-person events for a socially distanced world. A great example is the National MS Society (NMSS), which has done a fantastic job pivoting to a hybrid physical-digital experience for its annual Bike MS fundraising event.

Using a combination of technologies and platforms, including GPS tracking and cycling apps, NMSS was able to replicate – in a virtual world – key components of the in-person bike experience that riders love. By making this pivot, riders can participate virtually in opening ceremonies, team training sessions and races. Meanwhile, NMSS avoids missing out on the donated revenue it needs to fund its core mission.

In the longer term, nonprofits face two important imperatives.

The first is to diversify the revenue base. In addition to pursuing individual and corporate donors, nonprofits should seek out foundations as an important revenue stream. Our research indicates that the top two factors foundations consider when making grant decisions are 1) the nonprofit’s ability to demonstrate the positive impact it made as a result of the grant and 2) the degree of alignment between foundation and nonprofit goals. In addition, the pandemic is increasing foundations’ willingness to invest in the digital infrastructure of their nonprofit partners. In their Roadmap for Funders: Investing in Digital Infrastructure, the Technology Association of Grantmakers emphasizes that “social change in the digital era requires an investment in technology” and outlines concrete ways for funders to make these investments.

The second is to reimagine the donor experience. Nonprofits need to go beyond the tools and methods they have relied on for years. Extend, expand or replace those tools. Get serious about using – and bringing together – multiple channels. And find ways to make your mission highly relevant and present in donors’ day-to-day lives. One inspiring example, National Wildlife Federation’s Garden for Wildlife, offers resources for creating a garden for wildlife in your own backyard. How might other nonprofits innovate to provide their constituents with experiences that matter?

Alongside revenue shortfalls, nonprofits are likely to continue to see surges in demand. How can programs and services be tuned to better address increases in demand within the new environment? That’s a question I will explore in my next post. Until then, let’s stay in touch. Connect with me via LinkedIn and learn more about Accenture’s work with the nonprofit sector.

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1 https://cdn.ymaws.com/www.tagtech.org/resource/resmgr/resource_library/Digital_Infrastructure-Funde.pdf

Amit Patel

Managing Director – Public Service, Nonprofit Practice, Client Lead

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