AAW’s Global Team of management consultants are based in Asia, Africa, America & Europe. They provide our clients with unique insights into trends, audiences and markets. Working with corporate CSR teams, global INGOs and national charities the team have helped organisations develop strategies, income funding models and market entry plans.
One of the most common requests they receive on the audience side is around the area of millennial giving. How to reach? How to engage? How to keep? And how to keep up?
To help our clients navigate this audience, the team have produced a new AAW Insight Report which provides a detailed overview of trends and behaviours, as well as demystifying terms and products that are often associated with this age group. Here’s a little taster of the report. If you’d like a full copy, please email email@example.com.
Avocado toast, café lattes, house plants, and nomadic digital lifestyles… these are the defining hallmarks of the millennial generation. Yet it turns out that they are also a generous bunch with their time and finances, who care deeply about causes such as climate change, community development, economic inequality, and the sustainable development goals. These values are reflected in millennials expressing explicit preferences for corporate social responsibility in employers, providing monetary assistance to peers through platforms, and believing in their change quotient as philanthropists within their everyday lives to a much greater extent relative to Baby Boomers, Generation X, and Generation Z.
As a cohort, they number roughly 1.8 billion around the world, spanning the mid-20s to late 30s, centered in Africa and Asia. While lower house ownership dominates headlines, they are gaining prominence in wealth and giving in new ways. As we launch our latest Insight report Millennial Philanthropy: Global Study of a Generation in Giving, AAW’s global strategy team delve into how millennials are shaking up the space of charitable giving in spite of the financial uncertainty, global and national political turmoil, the COVID-19 pandemic, and global warming disruptions that they have been forced to face.
Steadfast despite Social & Economic Conditions
Shifting societal norms and the economic headwinds mean that millennials are less likely to get married and more likely to stay at home with parents, surpassing the highs last seen in the Great Depression in the US. Millennials, by and large, also owe tens of thousands of dollars of debt, with more than US$ 1.8 trillion of student loans in the United States alone as the cost of tuition has skyrocketed in recent years.
Meanwhile, real returns on traditional investments of the past in bonds have declined to zero or into negative territory. This challenging backdrop is prompting a shift into new asset classes, such as cryptocurrencies and “meme” stocks for “YOLO” (you only live once) strategies in the hopes of securing outsized returns. All the while, linear careers and retirement prospects of defined benefit plans are relics of prior generations that are forcing a fresh view of what constitutes a purposeful career and authentic corporate social responsibility. Millennials are choosing to vote with their feet with record numbers, leaving jobs in the so-called “Great Resignation.”
Inclusive Mindsets & Multi-Channel Influences
Millennials are more likely to integrate giving and philanthropy into their everyday lives, with influences from social media and donations through newfound means such as peer-to-peer platforms and online gaming streaming events. Shedding conventional notions, nearly 3 out of 4 millennials identify as philanthropists and are more confident in believing that their investments do make a difference.
It comes as no surprise that millennials have a higher preference for online giving chances than previous generations. Online channels account for 57% of total donations. Websites are the most preferred millennial channel, representing four out of every 10 contributions.
During the last ten years, social media has become more and more relevant. It has been growing not only as a donation channel but also as an engagement platform. NGOs can interact with younger audiences with frequent postings and directed advertisements. In addition, millennials enjoy sharing the causes they support with their peers and family members. This promotes peer-to-peer interaction through social media, enlarging the giving network.
Millennials are also much more likely to request information about impact and results. They read up on the content for updates of the nonprofits to understand tangible results, and speak to their friends and advisors for their recommendations. To that end, clear and transparent reporting is key.
COVID-19 Powers Donation Innovation
The majority of new givers in 2020-21 come from younger generations. According to a Fidelity study, millennials were the most likely generation to donate to charitable causes at 46%, compared to 25% of gen X and just 14% of baby boomers.
The pandemic spurred cryptocurrency adoption and NFTs’ popularity. Cryptocurrency donations show some potentially interesting advantages over traditional giving. Individuals or organisations donating through crypto exchanges may benefit from some tax advantages such as a potential reduction of capital gains tax (because of the appreciation of the asset over time).
Cryptocurrencies transactions are cheaper to process. Based on the 2020 Global Trends in Giving Report, 63% of donors prefer to donate online using a credit or debit card. Cards fees can range between 2.2 and 7.5%. Fees in crypto tend to be much lower at less than 1%.
With global temperatures rising and the frequency of extreme weather events dominating news coverage, global warming is a top concern area for millennials. Millennials eagerly support organisations that are sustainable, accountable and responsible, to help tackle climate change and/or are actively engaged in the protection of our environment. Additional important causes are health care and unemployment, a reflection of the times we are living in across crises of the environment, public health, racial issues, and the economy.
Expecting More, Doing More
Beyond the narrative of snowflakes and safe spaces, millennials are in fact driving change in the charitable sector with far-reaching implications for private, public, and social sectors. They expect more from leaders, organisations, and themselves as reflected in the ways that they live, work, and give. Players who comprehend these complexities and nuances will stand to gain.
For a copy of our report exploring these issues in more detail and to help you understand the level of commitment, resources and planning needed to capture the hearts and minds of these most elusive donors, please email firstname.lastname@example.org.