Charities need to engage with affluent millennials via their chosen technology platforms or miss out on future donations.
A report by The Beacon Collaborative, which encourages more private assets to be used for public good, shows charities have preconceptions about the giving habits of the millennial generation.
The report, The Giving Needs of the Future Wealthy, says charities assume this generation expects to engage with charities via technology, and they are attracted by innovative organisations.
However, the research found that wealthy millennial donors in the UK often felt disconnected from charities, and generalist fundraising approaches meant that this group was not being engaged effectively for a lifetime of giving.
The report found that wealthy millennials think firstly about changing the lives of individuals, and secondly about changing the world; they are reluctant activists who don’t make links between activism and charitable giving.
A key point the research revealed is that this group see technology as an enabler of, not a substitute for, a genuine relationship with a charitable organisation.
Right now, major giving is not on the radar of many millennials, although they may consider it later in life when more financially secure.
The report suggests that unless charities consider targeted ways to connect they will miss the opportunity to grow and build relationships with major donors of the future. It advises that engaging millennials while they are still at a moderate wealth level will help charities develop sustainable partnerships that will become more fruitful over time.
The opportunity is huge, said researchers, with an estimated £5.5tn set to change hands from baby boomers to millennials over the next 30 years in the UK.
The findings suggest this group is likely to give about three times more to charity than its older counterparts.
Consequently, researchers said that, to avoid a “lost generation of givers”, they need greater levels of support from charities to help them understand how their money will be spent, and how it will make a difference.
The report highlights 10 key findings about millennial donors:
- Wealthy millennials may be frustrated about bigger issues, but they generally don’t connect their giving with systems change
- They know less than you might expect about the complexities and workings of the charity ecosystem
- Donating is often in the moment and they are not currently seeking long term engagement
- Wealthy millennials often use the word “impact” to describe their own experience and professional goals. So, when charities use this word, it means something different to them
- Giving is not a core part of their identity though some see it as playing a role later in life. It can be intensely personal and therefore difficult to talk about, or awkward to talk about with others who are not as wealthy. However, there is an intrinsic sense of pride in their giving even if they rarely articulate this publicly.
- Individual fundraising however is completely different and they are very willing to talk about events and sponsorships that they have done to raise funds.
- Volunteering creates an awareness that encourages more committed giving
- For wealthy young millennials, their time is money. They see volunteering as more valuable than a financial contribution, but, that doesn’t mean they understand the financial value of their volunteering commitment.
- They aspire to give and do more, but the pathways they use are through work, business and local groups
- Wealthy millennials use technology to make their lives easier, more convenient and more fun; they don’t seek a technology solution for everything.
Matthew Bowcock, chair and co-founder of Beacon Collaborative, said: “Wealthy millennials are a critical part of a bright future for philanthropy in the UK.
“This research shows that fundraising organisations need to do more to understand their needs and set them on the path to a lifetime of giving.”