The philanthropic landscape is changing at a fast rate due to changing donor expectations, new workplace trends, and the increased use of digital engagement tools. The majority of nonprofit organizations are at a point where they are using conventional strategies for fundraising, staffing, and donor management which may not be very efficient. In order to stay effective and relevant, nonprofits must understand and respond to these changes. This article discusses the major trends affecting the industry and provides information on how organizations can prepare for them.
Major shifts are being seen in the area of philanthropy by the millennial and Generation Z donors who have very different values and ways of giving back. Unlike the older generations, these donors are very principle-based, tech-savvy and want to be involved in the causes they support. Current fundraising strategies such as the annual appeals and the gala events are not as compelling to these cohorts.
Studies show that Generation Z donors are most interested in social justice, honesty, and quantifiable change. They tend to give money to causes rather than to organizations and regard themselves as the drivers of social change. This generation is also more likely to participate in crowdfunding and watch charity streams on platforms like Twitch and Instagram Live. For example, GoFundMe has introduced in-video fundraising widgets to help this demographic.
In a survey conducted in December of 2024, it was found that 43% of Americans are trying to make up for a lack of charitable activity earlier in the year by increasing their good deeds – such as volunteering and donating – toward the year’s end. Gen Z and millennials were especially likely to take part in these efforts. However, these younger generations also reported feeling restrained by financial constraints, health issues, and time limitations, often doubting the impact of their actions.
To engage these next-gen donors effectively, nonprofits should:
Those nonprofits that do not adapt are being rendered increasingly irrelevant as the younger donors seek out organizations that not only demonstrate quantifiable outcomes, but also involve their supporters in the organizational decisions, and utilize social media to share compelling stories and information.
The rise of remote and hybrid work has significantly impacted the nonprofit sector. Organizations offering flexible work structures are attracting top talent and improving productivity. For nonprofits, embracing remote work not only broadens the talent pool but also offers a competitive edge in recruitment and retention.
Flexible work arrangements can enhance donor engagement and program impact. For instance, virtual volunteering allows individuals with restricted mobility or other special needs to participate in ways that might not be possible in traditional face-to-face volunteering.
However, some nonprofits resist this shift, clinging to traditional office-based models. This resistance can hinder innovation and limit the organization's ability to adapt to changing circumstances. Embracing flexibility is no longer optional; it's a necessity for survival in the modern philanthropic landscape.
An estimated 190 million people are actively looking for causes to support, yet many nonprofits miss out by not adapting to digital-first engagement strategies. Platforms like GoFundMe have noted that Generation Z frequently shares and supports causes on social media, highlighting a major shift towards online philanthropy.
To capitalize on this trend, nonprofits should implement digital-first engagement strategies, including social media outreach, peer-to-peer fundraising, and crowdfunding. Practical steps to expand their reach include:
By embracing these approaches, nonprofits can make it easier for supporters to contribute, thereby increasing their funding potential.
As Rear Admiral Grace Hopper famously said, "The most dangerous phrase in the language is, 'We've always done it this way.'"
It's time to confront an uncomfortable truth: clinging to traditional methods may be jeopardizing the future of many nonprofits. The reluctance to innovate not only alienates younger donors but also perpetuates inefficiencies that could be remedied through modern approaches. For example, the United Way's slow adoption of donor-choice policies led to a decline in general fund donations, highlighting the consequences of resisting change.
Moreover, the recent suspension of U.S. foreign aid contracts has created a significant funding gap that private donors are unlikely to fill, underscoring the need for nonprofits to diversify funding sources and adapt to new fundraising models.
Nonprofits must critically assess whether adherence to "the way things have always been done" is serving their mission or hindering progress. Embracing change is not just about survival; it's about fulfilling the organization's purpose in an evolving world.