The Ross-CASE 2018 Report: are we reaching our potential?

 

The results of the latest Ross-CASE survey of charitable giving to UK universities were released on Friday, and here at Holly Palmer Consulting we’ve been reviewing the numbers with interest. This is the first of two posts on the subject, and it looks at some of the results of the latest survey in the context of our ongoing higher education donor experience research project. The second part will look more broadly at the purpose of the Ross-CASE survey and raises some questions about its continuing role in the industry.

When the Ross-CASE survey was released in May last year, it was accompanied by great and justifiable fanfare: philanthropic income across participating universities had exceeded £1bn for the first time. The news was reported in several outlets including the Guardian and Third Sector, and a Thunderclap was organised in advance to ensure that word was spread far and wide on social media on the day. Staff across the sector had every reason to be proud of their achievement, and so many lives have been changed as a result of such generous support from alumni and other philanthropists.

About the same time that last year’s results were released, we issued our own report on the findings from a mystery shopping exercise we conducted across 15 universities in the UK. I recommend reading the report in full, but the bottom line is that “not a single one of the universities included in [the] study adopted a clear relationship fundraising approach”. When the 2017 Ross-CASE report came out we were struck by the decline in alumni donor numbers after years of steady growth, so when we obtained the latest data we immediately looked at alumni donor numbers to get a sense of how things had changed (if at all).

Unlike last year, alumni donor numbers have increased. That’s the good news, but the bad news is that new funds secured dropped by 12%, meaning that this year’s total falls below last year’s much-celebrated £1bn figure. The largest new gift/pledge is down a whopping 34%, and legacy giving is also down by 6%.

These numbers mean that there’s less to shout about than last year, but the foreword to the report does draw particular attention to a few areas. The one we’re mostly interested in concerns donor numbers:

Donor numbers nearly doubled over the decade, growing from 127,093 in 2006-07 to 246,056 in 2016-17. However, we celebrate long-term growth in both donor and alumni donor numbers rather cautiously as we look ahead. The impact of the Fundraising Preference Service, the introduction of General Data Protection Regulation and changes to the Privacy and Electronic Communications Regulations remain unknown. Anecdotal reports of sector shifts in activity could mean that donor number growth slows or even ceases in future years – interesting times ahead!

Higher education institutions need to continue to innovate and shift to take advantage of new opportunities. Reports abound of institutions successfully embarking on community-based fundraising and crowdfunding: successes here may have helped boost the 7 per cent growth this year in total donor numbers, well above the 2 per cent growth in alumni donor numbers.

There’s a lot to unpick here, but let’s start with the first sentence: donor numbers have doubled over the decade. Now whilst that’s true, I was interested in how alumni donor numbers in particular have changed since 2006/07 – and whilst it’s also nearly doubled from 108,235 to 191,073, that represents just 82,838 additional alumni donors to over a hundred participating institutions in this period against an increase of more than 5 million contactable alumni.

What about the more recent trend? Well, alumni donor numbers in the last three years haven’t moved very much:

YoY % change in alumni donor numbers.png

What that dashed line shows is the average % change in alumni donor numbers over the last three years across institutions that have participated in all three years, and as you’ll see it’s almost zero. Universities in the UK aren’t growing alumni donor numbers significantly, and whilst CASE attributed this last year to regulatory changes, we aren’t convinced this is the most likely explanation. Even if a small number of institutions are now being over-cautious in their approach to data compliance, the fact remains that the number of alumni who choose to donate has grown by only about 80,000 over ten years – and the rate of growth hasn’t been anywhere near double digits since the days of the government’s matched funding scheme.

So if regulatory changes weren’t the reason behind so little growth in alumni donor numbers, then what about investment? Here too the recent trends are instructive: the average change in fundraising costs over the last three years is 11%, and it’s quite similar for Alumni Relations. Clearly then there’s no shortage of money being spent on talented staff and resources, and whilst we can’t say much about where that money is being spent (for example, if the investment is mostly in major gifts then it makes sense that income figures are more impressive than alumni donor numbers), our own experience of the increasing headcount suggests that investment isn’t confined to a single specialist area.

Whilst we accept that it’s difficult to prove a definitive link between the quality of the alumni donor experience and recent trends in alumni donor numbers, we are nevertheless motivated to look into this further for two reasons: there’s plenty of research to indicate that the quality of the donor experience does impact retention rates (see the work of Adrian Sargeant, among others), and working towards a better experience for the donor is just the right thing to do.

This is why we launched the Higher Education Donor Experience Research Project, and the results from this year’s Ross-CASE survey haven’t suggested that we were misguided in doing so. We agree with the report authors that “higher education institutions need to continue to innovate and shift to take advantage of new opportunities”, but whilst we applaud efforts to grow community fundraising programmes, we don’t feel that such programmes will compensate on their own for the stagnation we’re seeing in participation across more traditional mass market initiatives.

Now, I want to be clear that I’m not engaging in some sort of hand-wringing exercise here, but I don’t feel there’s much value to be gained in celebrating success if we don’t also honestly reflect on areas for improvement. It’s true that we’ve been quite disappointed by what we’ve seen of the donor experience on offer by many universities in the UK, and it’s also true that some of the numbers in the latest Ross-CASE survey are less impressive than many in the sector would hope for. Yet that’s precisely why we’re volunteering our time and expertise to understand this subject further, and it’s why we want to play an ongoing role in changing our sector for better over the coming years.

If you read between the lines, it seems that the sector’s flagship benchmarking exercise arguably shows a sector that is struggling to achieve its potential. Maintaining the status quo is surely not enough anymore.

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