This mid-year update to our whitepaper, Trends in Advancement, Fall 2022, underscores the reality that the “pandemic pivot” in institutional relationship-management has forced alumni, development and marketing offices to be more creative, collaborate more and test new ways of interacting. But while the shift from traditional, in-person activities toward digital and virtual engagement continues, alumni and donors now seek both. They expect virtual and digital for convenience and, still for some, safety, while many are also eager to be together in-person for the energy, efficiency and often more personable connections of face-to-face engagement. The key for alumni and fundraising professionals is to offer the right mix of virtual and in-person interactions, the balance that will serve the range of stakeholders and meet them “where they are.”
At the same time, and perhaps most important, is there is no turning back from the trend of recent years – to personalize, personalize, personalize. Whether it’s outreach, promotion, information-sharing, content and communications about them must compete to grab attention (e.g., video and digital interactivity) yet be transparent and demonstrate benefits and outcomes. Time is a fixed commodity, and to encourage your stakeholders to spend time with your organization rather than the next-best competitor for their attention, advancement organizations must offer a consistently positive, relatable, barrier-free and where possible, unifying experience.
Here’s our deeper dive, picking up from the advancement trends we identified earlier in this academic year…
Shifts in consumer behaviors and expectations accelerated by COVID-19 have forced organizations to change how they connect with customers. In business, those that do not adjust will be left behind. Why? Because “platform organizations” that connect with customers online via multiple touchpoints informed by sophisticated analytics accelerated improvements in relationship management during the virtual activities forced by the pandemic. In many cases, nonprofit organizations, including those in university advancement, were not prepared to make the shift from in-person activities. Yet others did use the time to make improvements in the digital “customer experience” for students, alumni and donors – and not lose traction.
Because of these developments, traditional major donors comfortable with face-to-face solicitations in a linear series of in-person cultivation activities are increasingly responsive to “digital” and “instant” interactions – just as they are day-to-day with Amazon, Uber, banks and online retail. In fact, what’s in your “in-basket” will more likely grab your attention if it is personalized, timely and focused. What McKinsey & Company describes as a “proven formula for executing customer-experience transformations” is also applicable to nonprofit organizations, such as universities and their advancement divisions. This model comprises specific steps across three core building blocks – a clearly defined aspiration, an agile transformation approach and a thoughtful deployment of new capabilities, particularly advanced analytics.
The past 20 years have seen substantial changes in how fundraising organizations use technology; those on the leading edge (and their partner alumni associations) use customer relationship management software that pulls together multiple pieces of data to create useful donor profiles. Advancement data science teams are partnering with firms like Salesforce and Fundmetric, among many others, to leverage another new partner – artificial intelligence (AI). With data-gathering and predictive analytics tools, AI – once feared as a threatening replacement for people – is potentially one of advancement professionals’ best partners.
As the following trends show, the path toward “Advancement 2040” is hyper-personalized, builds strategically and has customization with multiple touchpoints from admissions to lifelong learning in the longterm relationships of universities and their constituencies (sometimes called the “60-year degree”). These trends focus on five key areas: (1) fundraising, (2) generational shifts, (3) continuously evolving methods for engagement, (4) integration of alumni and career services and (5) sophisticated digital transformation.
According to Giving USA 2022: The Annual Report on Philanthropy for the Year 2021, there was an estimated $484.85 billion in giving in 2021 – an increase of 4% over 2020 thanks to a recovery of the stock market and GDP to pre-pandemic levels and buoyed by very large gifts by some of the wealthiest Americans. While giving increased in current dollars, it remained flat after adjusting for inflation. 
The story for early 2022 continued to show growth, but with large donors carrying the weight of that growth and inflation impacting the effect of those dollars. In its 2022 First Quarter Fundraising Report, the Fundraising Effectiveness Project (FEP) reported fundraising in the U.S. increased by 2.2% in the first quarter of 2022 over the first quarter of 2021 – driven primarily by large donors – but the donor pool continued to shrink. The report found the number of donors decreased by 5.6% and the donor retention rate, the percentage of donors who gave in 2021 and again in 2022, decreased by 6.2% year-over-year.
“In some ways, we shouldn’t be surprised at the data,” said Mike Geiger, MBA, CPA, president and CEO of the Association of Fundraising Professionals’ Foundation for Philanthropy. “Charitable giving overall has been extremely strong in recent years — the FEP calculated a growth rate in giving of 11% from 2019 to 2021 with the number of donors basically remaining flat. That high level of growth in giving was unlikely to continue, and so these numbers reflect the retrenchment in donor participation. But what is concerning is the impact of inflation, as the FEP numbers are in actual dollars. So, when inflation is accounted for, the 2.2% growth rate in charitable giving is less impactful for organizations.”
After low inflation for more than three decades, Americans are changing their spending and saving habits in the face of rising inflation. In an annual Donor Confidence survey released by Dunham + Company in June 2022, 63% of donors said they are being cautious with their giving, which is up from 59% the previous year. The three leading reasons donors expect to give less in 2022: their financial situation (41%), the economy (13%) and inflation (35%).
Dave Smith, CEO and founder of Heaton Smith Group, suggests nonprofit leaders and gift officers proactively work to mitigate the decline in giving to their organizations with the following activities:
- Focus on the Baby Boomer generation and their combined assets of $70 trillion.
- Provide well-crafted impact reports to current donors on the specific difference their gifts are making.
- Develop a set of relevant donor discovery questions to fully understand the needs and goals of both donors and gift officers.
- Broaden the organization’s gift opportunities for donors, such as appreciated stock, real estate and tax-effective giving.
- Offer blended gift strategies for donors with estates valued up to $10 million, who are likely to focus on income and asset preservation during a high inflationary period.
- Increase knowledge of life-income gifts, especially important for higher capacity donors.
- Strengthen stewardship practices to prevent donors from slipping through the cracks and engage in meaningful conversations around donors’ needs during high inflation.
What does the shifting landscape for philanthropy mean looking forward? Jessica Browning, principal and EVP at fundraising consultancy Winkler Group, reported on the recent changes in giving and the expected trends in 2022 and beyond: 
- Demand for campaigns will continue to be strong. The Winkler Group saw more seven-figure campaign gifts in 2021 than any other year in its nearly 20-year history. 2022 is expected to be another landmark year for campaign success given expected stock market growth and the trend towards ever-larger gifts. Whether the recent stock market roiling will change this is yet to be seen.
- Shorter strategic plans. While five-year strategic plans have been the standard, Browning expects a shift towards shorter timelines in 2022 and beyond; some organizations have been adopting plans as short as two years.
- Fewer donors, larger gifts. The erosion of mid-level giving is expected to continue and a focus on philanthropic growth at all levels is important. Efforts towards donor retention should be intensified to mature lower-level donors into mid-level and then major gift donors.
- Increased corporate engagement, not necessarily philanthropy. The majority of giving in the U.S. will continue to be from individuals (78% of all giving bequests in 2020); only 4% of giving came from corporations and in 2021 corporations gave less than one percent of pre-tax profits to charities. However, opportunities exist for strategic corporate/nonprofit partnerships, such as workforce development programs through local colleges, and as corporations align with the diversity and social justice initiatives of younger Americans.
- A heightened focus on performance ratios. While the pandemic skewed the ideal program expense and fundraising efficiency ratios, Browning predicted those ratios to stabilize in 2022 and beyond and recommended a target expense ratio of 85% and fundraising costs that equate to between $0.05-$0.10 of every dollar raised.
- DAFs will continue their meteoric rise. A report by the Indiana University Lilly Family School of Philanthropy and Giving Institute found donor advised funds (DAFs) grew from $31.1 billion in 2006 to $141.95 billion in 2019. Those values will continue to climb; The Special Report on Donor Advised Funds found education and the arts received the most DAF grants (29%).
- Generational Shifts
The future of philanthropy revolves around engaging the next generation of donors; over the next two decades, there will be an unprecedented shift in wealth from Baby Boomers to Millennials and Generation Z. The projected $30 trillion “great wealth transfer” is an incentive for nonprofits to cultivate strong relationships with this next generation of philanthropists.
Generation Z (Gen Z), born between 1996 and 2014, are considered the most technologically advanced generation, and the global issues they’ve witnessed have shaped who they are and what they are passionate about. They are more spontaneous with their giving and look to be part of something bigger than themselves, donating to organizations looking to change policies they are passionate about. They put a greater focus on receiving public recognition from their actions, specifically online or with peers. (Source: CCS Fundraising)
Millennials, born between 1981 and 1995, are adaptive to technology, but much less dependent on it. Making up a large percentage of today’s workforce, they balance building a career, raising a family and giving back to organizations that directly reflect their values around societal and economic issues. They typically research a nonprofit or make a connection before making a gift. (Source: CCS Fundraising)
Both Gen Z and Millennials, who made up 16% of total giving in 2018, cite volunteering for and donating money to an organization as one of their top ways of giving back and making an impact. Since they want to see direct impact through the nonprofits they support and to be included through experiences, nonprofits should be transparent in their communication to build trust and engage a large population of young professionals and future donors.
Several ways young professionals have engaged in philanthropy during a tumultuous year include:
- An expanded meaning of charitable giving. Young professionals approach philanthropy with both monetary donations and by directly engaging the community. Nonprofits should align with these priorities by clearly articulating the direct way contributions are uplifting community, tailoring the organizational story to showcase the ways it has broken standard operating norms, and by using existing corporate partnerships to engage young professionals at a company.
- Seeking a more equitable future. According to LendingTree, almost 18% of Gen Z and almost 14% of Millennials cited racial justice as their most important cause. As a result, they have turned an eye towards the diversity of the staff and leadership at the nonprofits they support. Nonprofits should consider how they can diversify staff, perspectives and experiences at the leadership level; reshape to better reflect the immediate needs of the community; and upskill workers around racism, bias and inclusivity.
- Giving to multiple causes: donation-based crowdfunding. Crowdfunding is the most popular form of giving among young professionals, allowing them to directly support causes they care about while engaging friends and family. Crowdfunding also provides an opportunity to support a myriad of charitable causes, regardless of size and complexity, all while making a large impact regardless of their gift size. Key considerations for organizations include: how to make charitable giving more accessible to young professionals unable to give at high levels; employing social media platforms and encouraging online giving; and creating a straightforward and easy-to-access giving platform.
- Continuing to Evolve Alumni Engagement
Consistent alumni engagement is crucial to building a great institution and ensuring continuity. While traditional channels will continue to have their place, new evidence gleaned from the COVID-19 pandemic suggests institutions won’t be restricted to them. This evolving alumni relations landscape calls for the adoption of more modern, technology-driven strategies for effective alumni engagement.
According to Almabase, following are five trends for 2022 to achieve alumni engagement goals:
- Event strategies will evolve. The pandemic halted in-person events and many institutions pivoted to virtual alumni events. Looking ahead, advancement teams in 2022 will need to take a hybrid approach of both virtual and in-person events to keep alumni engaged.
- Alumni will be at the heart of all alumni engagement. The pandemic prompted advancement teams to look for creative solutions beyond traditional newsletters, events and yearly fundraising appeals to penetrate a wider segment of their alumni population and maintain consistent engagement year-on-year. Looking ahead, advancement teams will provide more value and on-demand programming – such as focused workshops, career networking and mentoring programs – to build meaningful relationships with their alumni.
- Measurement of engagement data will be more streamlined. Traditional measures of engagement made it difficult for institutions to glean insights during COVID-19 when in-person events were cancelled and fundraising asks were dialed down. After identifying massive gaps in alumni engagement in 2021, advancement teams are focused on more robust engagement data – from social media interactions, email engagement, mentor-mentee engagement and volunteer participation – and the digitization of that data to lead decisions and develop stronger alumni relationships.
- An increased focus on mid-level donors. When unemployment affects the fortunes of major gift donors, as it did in 2020, institutions are directly impacted. Studies indicate 88% of all funds donated to schools come from 12% of donors, and these donors constitute major gift donors. In 2022, fundraising is going to be largely focused towards mid-level donors and converting them into long-time donors. Advancement teams will also be on the lookout for creative ideas to expand their current donor base and drive up engagement with more diverse alumni segments.
- Career networks will continue to be integral to alumni programs. The COVID-19 pandemic and rising unemployment rates across industries has highlighted the importance of alumni networks for professional networking and career growth. With recent reports indicating 21 million Americans are unemployed as a consequence of the pandemic, career networks will continue to be crucial in strategically engaging alumni. An increasing number of institutions will invest more in building online career networks and job and internship boards to support students and alumni.
- Integrating Advancement and Career Services
With the continued importance of career networks to alumni programs, one of the recent trends is coupling career programs and advancement, through direct reporting lines or formalized internal collaborations. The Association of American Colleges and Universities’ 2021 survey of employers found while employers value the college degree and believe a liberal education provides knowledge and skills that are important for career success, they also see room for improvement in how colleges and universities prepare students for work. Whether preparation for a specific profession or job, active and applied learning experiences with employers or development of a broad skill base that can be applied across a range of contexts, colleges have been doing this all along. Today the issues are more acute, however, as the vast majority of students cite jobs and career outcomes as the number one reason for going to college.
“College career services units have traditionally focused on empowering students to attain their first career after graduation. However, careers are usually made up of a series of different jobs and roles: The first job search is rarely the last,” write Suzanne Helbig and Gary Matkin, authors of a report for the National Association of Colleges and Employers (NACE). Matkin is dean of continuing education and vice provost of career pathways at the University of California, Irvine (UCI) and is the individual identified with the concept of the “60-year curriculum,” which begins with a student’s first year in college and spans their career. As part of the trend to reposition career services for greater effectiveness, UCI created a separate division for Career Pathways in 2017. “It is no wonder that alumni and continuing education students are looking to their colleges for leading-edge professional development and career advancement support to span their years in the workforce,” Helbig and Matkin continue. “Colleges that respond to these needs provide valuable reasons for alumni and community members to engage with and value their campus.” Done well, career services that cover the entire 60-year curriculum, they contend, increase chances of alumni giving, encourage alumni to hire fellow alumni and create a broad talent pool ranging from student interns to executive-level professionals. Moreover, heightened calls to demonstrate economic impact in a competent workforce “mean that the career services function needs to be better positioned to play a key role in connecting the employer community to the campus…and [with] greater capacity to quantify and present the outcomes of these efforts.”
- Sophisticated Digital Transformation
The COVID-19 pandemic underscored the necessity of technology and digital transformation in alumni relations. A variety of new technologies are powering the future of higher education and enabling data-driven decisions, supercharging alumni engagement and facilitating smooth operations. Referencing the annual technology trends forecast produced by the global research and advisory firm Gartner, Cuseum identified 2022’s top technology trends and what they could mean for alumni engagement:
- Data Fabric
According to Gartner, data fabric provides “flexible, resilient integration of data sources across platforms and business users, making data available everywhere it’s needed regardless of where the data lives.” Data fabric architectures may play a pivotal role in helping universities manage enrollment, operations, research, advancement, and more. For alumni relations and advancement, data fabric may bring together data points from dispersed units, divisions and campuses within a university to develop more holistic insights about donors and constituents.
- Generative Artificial Intelligence (AI)
Generative AI encompasses “machine learning methods that learn about content or objects from their data, and use it to generate brand-new, completely original, realistic artifacts,” according to Gartner. Generative AI creates new content using existing text, audio files, images, and videos. When AI is used for alumni engagement, it can power university chatbots, gather insights to maximize alumni loyalty, engagement and giving, and deliver hyper-personalized content and hyper-intelligent fundraising.
- Distributed Enterprises
“Distributed enterprises reflect a digital-first, remote-first business model to improve employee experiences, digitalize consumer and partner touchpoints, and build out product experiences,” per Gartner. Motivated by the pandemic, colleges and universities are offering online programs expected to outlive the pandemic. Alumni relations is part of this shift. In 2020, 97% of alumni relations professionals had begun or increased their number of virtual programs, and expanded use of social media, online communication and fundraising channels, and digital alumni benefits. Using digital platforms, universities are catering to diverse, geographically-dispersed students and alumni, while also adjusting to long-term remote and hybrid workforce models.
- Cloud-Native Platforms
In 2022 and beyond, higher education institutions are hoping to reap the many benefits of cloud-native platforms – technologies that “build new application architectures that are resilient, elastic and agile” – particularly an efficient and resilient IT foundation. Gartner predicts cloud-native platforms will “serve as the foundation for more than 95% of new digital initiatives by 2025.” The number of cloud-based alumni management and engagement platforms is booming. Tools like Graduway, Almabase, Evertrue and Ellucian are helping alumni teams build virtual networks, streamline alumni engagement and fundraise more effectively.
- Cybersecurity Mesh
Cybersecurity is continuing to rise as a chief business and consumer concern, and the public is demanding more protection to ensure the integrity of their personal information. Gartner has named cybersecurity mesh a top trend that “enables best-of-breed, stand-alone security solutions to work together to improve overall security while moving control points closer to the assets they’re designed to protect.” At universities and institutions, phishing attempts and ransomware attacks are increasing; the average ransomware attack costs educational institutions $2.73 million. Cybersecurity mesh may become increasingly important for universities to maintain stable operations, protect data, safeguard financial solvency and establish trust with alumni and donors.
- Decision Intelligence
Decision intelligence is “a practical discipline used to improve decision making by explicitly understanding and engineering how decisions are made, and outcomes evaluated, managed and improved by feedback,” according to Gartner. Decision intelligence can use data analytics, AI and simulations to help universities save resources, maximize revenue and mitigate risk. In alumni relations, decision intelligence can help pinpoint the activities and campaigns that help achieve advancement and engagement goals.
- Total Experience
Gartner defines total experience as “a business strategy that integrates employee experience, customer experience, user experience, and multi-experience across multiple touchpoints to accelerate growth.” Because total experience recognizes all of a university’s constituencies – from prospective and current students to faculty, staff and alumni – form facets of a singular and interrelated experience, it can be used to help universities drive employee retention, student outcomes and alumni loyalty. This approach empowers alumni professionals to examine how other divisions of the university may impact alumni engagement and inclination to give.
 “The three building blocks of successful customer-experience transformations,” McKinsey & Company, Oct. 27, 2020.
 “Total U.S. charitable giving remained strong in 2021, reaching $484.85 billion,” Giving USA Foundation, June 21, 2022.
 “COVID Era Fundraising Stalls as Donations Soften and Donors, Retention Rates Fall in First Quarter 2022,” Fundraising Effectiveness Project, July 12, 2022. https://afpglobal.org/covid-era-fundraising-stalls-donations-soften-and-donors-retention-rates-fall-first-quarter-2022
 Ibid., Fundraising Effectiveness Project.
 Dave Smith (CEO & Founder of Heaton Smith Group), “Combat the Effects of High Inflation on Donors’ 2022 Giving,” The Giving Institute, August 5, 2022.
 Ibid., The Giving Institute.
 Jessica Browning (Principal and EVP at Winkler Group), “Trends That Will Shape Philanthropy in 2022,” Giving USA, Dec. 16, 2021. https://givingusa.org/trends-that-will-shape-philanthropy-in-2022/
 Courtney Labetti, Kaleigh Wagner, Alexander Fruin, “Engaging the Next Generation of Philanthropists,” CCS Fundraising, April 5, 2021. https://www.ccsfundraising.com/insights/engaging-the-next-generation-of-philanthropists/
 Ibid., CCS Fundraising.
 “5 Alumni Engagement Trends You Need To Watch Out For in 2022,” Almabase.com, Feb. 9, 2022. https://www.almabase.com/blog/5-alumni-engagement-trends-you-need-to-watch-out-for-in-2021
 “What Employers Want,” Inside Higher Ed, April 6, 2021.
 Suzanne Helbig & Gary W. Matkin, “College Career Services on the Move: Why – and What Does it Mean?”, National Association of Colleges and Employers (NACE) Journal, August 2021.
 “Top Technology Trends in 2022 – And What They Mean for Alumni Relations,” Cuseum.com, Jan. 13, 2022. https://cuseum.com/blog/22/13/1/top-technology-trends-in-2022-and-what-they-mean-for-alumni-relations