We were delighted to interview Martin Wilson, Innovation Scout from the RNLI, about their Future of Donations project.
1. To set the scene, can you tell us more about how you think the fundraising landscape is changing for charities, and what role digital plays?
Ever since the RNLI conducted the first ever street collection in 1891, hauling one of our large wooden lifeboats down a Manchester street, fundraising has been in a state of constant evolution. However, that rate of change has accelerated over the past twenty years as the charity sector has followed donors online and then to mobile devices. In fact, in the past few years we have seen a rapid shift in public behaviour away from cash, one of the mainstays of voluntary donations, to alternative payment methods. UK Finance, the trade association for the UK banking and financial services sector has noted that cash has fallen from representing 62% of all payments by volume in 2006, to 40% in 2016, and is predicted by industry to fall to 21% by 2026. Meanwhile, contactless payments made each month have grown by nearly twenty times in the three years to June 2017. In fact, research suggests that two-thirds of people are making more payments digitally than they did five years ago. These new digital offerings provide great benefit to consumers, businesses and charities by offering convenient, tailored and flexible ways of transacting.
2. What do you predict will happen if charities don’t explore different fundraising models?
While it is extremely difficult to paint an accurate picture of what will happen within the fundraising sector, it is possible to see societal and behavioural shifts that are impacting the relationships that charities have with their donors. The introduction of new payment methods, a more cluttered messaging landscape and increased donor expectation are all introducing elements of risk around what have been seen as the more reliable sources of fundraised income; cash donations, legacies, regular committed giving. These shifts are increasing the need for charities to adopt a more transformational approach to technology and be more creative in building their blend of fundraising activities.
3. Can you summarise what the Future of Donations project is, along with the work done to date?
The Royal National Lifeboat Institution (RNLI) sought to identify, understand and interpret emerging behaviours and technologies within the wider political, economic and societal context in order to make informed decisions on how to act. For example, the RNLI may wish to actively invest resource in developing a capability that exploits this technology, or partner with an organisation with similar goals to share the burden of exploring a new technological frontier.
In order to do this, we engaged the Institute for Manufacturing, University of Cambridge, and the methodology of Technology Roadmapping. To ensure that the decision was not based on local, biased and parochial knowledge, we recruited subject matter experts from charity, technology, finance and academia to explore the exploitation of technologies that will ensure that the RNLI would have the ability to remain relevant to the donating public, and that we are able to develop strategies that shore up our funding streams as we move towards an uncertain future.
An additional driver behind this work was the need to bring some coherence to what is an extremely ‘noisy’ sector. In recent years there has been an explosion in the number of platforms and services purporting to have the potential to be of great benefit to charity fundraising. By bringing together stakeholders from across the charitable donation sector, it was hoped that the risk of the sector progressing multiple solutions to the same problems would be reduced and economic economies of scale be realised by coordination of needs early on in the procurement process.
4. What are the key trends unearthed by the project and what should charities do about them?
The activity achieved its objective to build a coherent joint vision for the future of donations. It is the intention that this vision would prompt challenge and discussion that leads to collaboration around areas of interest and the ability to deliver joint requirements to industry; allowing cost savings to be realised from shared aims and a reduction in resource requirements to take new initiatives to market.
Within the activity it became apparent that technological developments are enabling the sector to use the data that they have access to in much better ways, either through integrated services and platforms, or through the introduction of Artificial Intelligence tools. The effective use of these technologies relies upon the eradication of data silos and good taxonomy of data – something that many charities and businesses struggle with. The recent Salesforce.org Nonprofit Trends Report found that only 17% of not for profit leaders have complete confidence in data management and system integration, indicating a real immediate need for efforts in this area.
In the receipt of donations, there are some significant opportunities being created within the areas of AI, microdonation, and preparation for a cash free society. In order to fully maximise on these, there is a need for the fundraising sector to increase technology skills, particularly within the areas of Artificial Intelligence, API and blockchain, which will continue to be used to create new models for products and services.
It was felt that initially charities need to build their knowledge base in order to identify how new technologies can support their organisational strategies and then implement activity that increases the technological confidence required for investment in more transformational developments.
5. It’s a really exciting initiative. How can charities get involved?
We are really grateful to everyone that supported this project, however are fully aware that the report has been built around the opinions of an informed, but relatively small group of people. It was always our intention that the outputs of this activity would be the stimulus for further discussion so have created a Linkedin group to facilitate this .
Take a look at RNLI’s Future of Donations report