Australia’s non-profit and charity sector is crucial to the well-being of many communities, providing vital services and support to those in need. The sector employs almost 1.5 million paid workers, with revenue expected to total $201.0 billion in 2023-24[i]. Non-profits and charities face a range of challenges amid a period of rapid technological innovation and economic uncertainty.
Economic conditions have a strong effect on the performance of the charities and not-for-profit sector. Persistent, rampant inflation has weighed on household incomes, increasing the demand for industry services.[ii] During economic hardships, vulnerable populations like the unemployed, homeless, and those facing mental health challenges often require more support, putting stress on non-profit resources.
In an era of tight budgets and growing needs, non-profits must navigate a challenging landscape. With slow economic performance, leading to a fall in real household discretionary income, the level of donations and support from private sources will be constrained. The sector is increasingly expected to do more with less.
By embracing the latest digital technologies organisations can make a bigger difference on a smaller budget. The digital age presents a treasure trove of opportunities for non-profits and charities to amplify their impact without breaking the bank. Edwina Morgan, , General Manager, Customer & Strategy, Salvos Stores, comments, “It’s about how you smartly insert technology into your customer journey maps to actually enhance the experience and to build efficiencies, convenience, and frictionless interactions for the customer”.
The COVID-19 pandemic acted as a catalyst for digital transformation in the non-profit industry, forcing a rapid acceleration of pre-existing trends and the adoption of new technologies. Lockdown restrictions necessitated remote work, prompting non-profits to invest in collaboration tools, cloud-based platforms, and digital training for their staff. With traditional fundraising events and activities hampered, non-profits turned to online fundraising platforms, social media campaigns, and virtual donor engagement initiatives.
Recognising the increased reliance on digital services, non-profits prioritised website accessibility and user-friendly interfaces to ensure everyone could access their resources and programs. Mobile optimisation became crucial, as more people used their smartphones and tablets to connect with non-profits. Morgan says, “The key lies in truly understanding our customers – both existing and potential – and engaging with them where they already are. This means leveraging both digital spaces like social media and our own website, while also seamlessly integrating technology into physical stores”.
“For me, prioritising customer needs is paramount, and then strategically employing technology to enhance their journey at every touchpoint”.
Overall, COVID-19 pushed the non-profit industry towards embracing digital transformation, making it a key driver of their future success and impact. The focus on online outreach, user experience, and data-driven strategies will continue to shape the landscape of the non-profit sector in the years to come. Non-profits need to adapt to the changing landscape to effectively reach and engage their target audience.
The shift towards digital engagement
The pandemic has fundamentally changed the way people interact with organisations and the causes they care about. Non-profits can no longer rely solely on traditional outreach methods – the shift towards online platforms is undeniable.
The COVID-19 pandemic acted as a catalyst for digital transformation in the non-profit industry, forcing a rapid acceleration of pre-existing trends and the adoption of new technologies. Lockdown restrictions necessitated remote work, prompting non-profits to invest in collaboration tools, cloud-based platforms, and digital training for their staff. With traditional fundraising events and activities hampered, non-profits turned to online fundraising platforms, social media campaigns, and virtual donor engagement initiatives.
Morgan explains the transformation that the Salvos Stores went through in response to the pandemic, “COVID greatly accelerated our digital strategy and digital intent. We’re a charity whose purpose is to raise funds for the Salvos Stores and its mission by selling donated goods through our retail outlets. We had been looking at the advancement of second-hand shopping for quite a while, particularly what was happening in the US and UK. We wanted to open up channel growth and provide customers and donors with greater choice in how they interacted with us. COVID gave us an opportunity to accelerate that by using a variety of digital platforms and technology.”
“During COVID we launched our e-commerce site allowing us to list up to 40,000 individual items that are on offer across Australia. This has allowed accessibility into Australian communities where we didn’t have physical stores. Our digital strategy has allowed us to overcome some of our customer pain points by opening up different channels and touchpoints for customers and donors to interact with us.”
Prioritising digital experiences is essential.
Since the end of the pandemic, the shift towards digital engagement has continued its momentum across the entire sector. Recent research shows that:
- In the past year, mobile giving donations have increased 205%. 51% of people who visit a nonprofit’s website do so on a mobile device[iii]. Having an accessible, easy-to-navigate and engaging website, is crucial for non-profits to ensure users have an enhanced online experience.
- 76% of Non-profits consider social media an important and effective tool for their organisation[iv]. Social media platforms have become powerful fundraising tools, with platforms like Facebook and Instagram facilitating peer-to-peer fundraising campaigns. Engaging content, targeted ads, and interactive campaigns can build sizable communities around a cause.
- 66% of not-for-profits send regular email newsletters and updates. They consider email to be integral to communicating with stakeholders.
- Digital wallets and online payments.
Prioritising digital engagement is no longer optional – it’s essential for non-profits to remain relevant and effective.
AI is a “need to have”
A study by Salesforce found that 74% of non-profits consider AI a “need-to-have” for digital transformation[v]. While still in its early stages, generative AI holds immense potential to revolutionise how non profits operate, fundraise, and ultimately achieve their missions. Generative AI can automate repetitive tasks, such as data entry, grant writing, and donor outreach, freeing up staff time for more strategic initiatives.
Generative AI, with its ability to create text, images, and even code, presents a new frontier for non-profit organisations. While still in its early stages, it holds immense potential to revolutionise how they operate, fundraise, and ultimately achieve their missions.
[i] https://www.ibisworld.com/au/industry/charities-not-for-profit-organisations/1950/#FrequentlyAskedQuestions
[ii] https://www.ibisworld.com/au/industry/charities-not-for-profit-organisations/1950/#FrequentlyAskedQuestions
[iii] https://nonprofitssource.com/online-giving-statistics
[iv] https://www.infoxchange.org/sites/default/files/ix_techreport21_fa2-screen_0.pdf
[v] https://www.triplepundit.com/story/2023/salesforce-nonprofits-ai/783176
