Charities that focus on brand will win-out in the tough market to come.
In the past two months we’ve witnessed extraordinary levels of generosity from the British public in response to Covid-19. The NHS Charities Together appeal looks like it will top £100 million, with Captain Tom’s heroics contributing £30 million plus. Charity emergency appeals have also been responded to with equal levels of generosity, some seeing previously undreamed-of CPAs.
It’s as if the public’s pockets are bottomless.
But none of us should be blinded by this welcome and wonderful spate of giving. It’s not sustainable. The fragility of the public’s personal finances will soon become apparent as the full cost of the economy ‘stopping’ hits home. We will see failing businesses, record levels of unemployment, retirement incomes in tatters, just as mortgage, rent and credit amnesties come to an end.
It’s not surprising that the majority of economic commentators’ predictions are in the ‘catastrophic’ range, beyond 2008 – closer to the Great Depression of the early 1930s.
While the most economically vulnerable will be hit hardest, the impact will be felt across the wealth spectrum. Prioritisation of expenditure will become the critical focus for the vast majority of households. The desire to be generous will still be there. The money won’t.
The implications for the charitable sector are obvious and reflected in the Directory of Social Change’s recent warning that 50% or more of charities might fail this year, with over £4b already lost in what might only be the first phase of this pandemic.
Charity leadership teams are working around the clock reviewing their strategic options, trying to plot a course through what will be a long and sustained financial crisis. Whatever decisions each charity comes to, it will be crucial that they are made within the context of cause. Because cause, and how it is communicated will become the key competitive weapon in the funding battle that lays ahead.
Self-isolation has not just come at a financial cost, we’ve also lost a little of our own self-identity and sense of purpose. As we emerge from self-isolation, feeling less certain, less in control and with severely reduced financial resources, we are likely to double down on the things we feel matter most. We will be looking for causes that feel clear, vital and meaningful. Causes that help resolve our own loss of identity and purpose, and that we feel have real urgent value to people and communities.
We will be scrutinising charity brands more than ever before; judging if they are unnecessarily replicating the work of other charities or commercial brands, or if their service provision is clearly focused on the needs of the people, children or animals they exist to support. Do they seem efficient or do they waste money on peripheral activities that don’t seem to resonate with our perceptions of their cause? Critically, is their cause really as essential as other competing causes? And, in sectors where multiple charities serve a common beneficiary, the children’s sector for example, are they first choice versus the others?
These are the questions that will come from existing and potential donors. Being able to successfully answer them will depend on the way charities are able to express the vital nature of their cause, so that we believe theirs is ‘one of the vital ones’, one of the causes ‘that we cannot let fail’.
The charities that present their cause at its most essential and demonstrate the alignment of their service delivery with the essence of this cause, will be the ones that win in the tough times that lay ahead.