A shifting marketplace
Legacy Foresight has been analysing the British legacy sector for over two decades, and the topic never ceases to fascinate and often move us.
On the one hand, legacy incomes represent the accumulated decisions of thousands of individuals about the world they want to leave behind them. On the other, they reflect some of the greatest economic, political and social themes of our age. Understanding what drives legacy giving overall can help you to stimulate, manage and plan for your own legacy fundraising.
Looking ahead over the next ten years, we see new challenges emerging which will affect both the number and value of legacies received and the way that legacy fundraising and administration is managed. Like all the best challenges, these trends will pose threats to current ways of legacy thinking; but they are likely to open up new opportunities too.
From values to numbers
Over the past three decades much of the growth in legacy income has been driven by the economy – in particular house and share prices – pushing up the value of residual bequests. At the same time, despite the falling death rate, the number of bequests received by UK charities has been slowly rising, thanks to greater awareness and interest in legacy giving.
But those long-term patterns look set to change. On the one hand, deaths are now rising and are expected to accelerate ever more rapidly over the coming decade. On the other, the mid-term economic outlook is looking far more shaky, due to pervasive uncertainties about Britain’s role within Europe, and about global political and social trends.
We believe that over the coming decade, growth in the number of legacies will play a far more important role; while growth in the value of those gifts will slow, and in some years fall.
From War Babies to Baby Boomers
Demographers have long been predicting that the number of UK deaths would flatten off around 2014 and then start to climb from around 2017. However, the latest data from the Office for National Statistics suggest that deaths actually bottomed out in 2011, and have been climbing ever since. This trend is being driven by the Baby Boomers.
Compared to previous generations, Boomers hold different values. They are more willing to challenge conventions about who their money should go to – favouring friends and trusted brands over distant relatives. At the same time, the Boomers pride themselves on being confident and demanding donors. They expect personalised service, and need to feel in control. To aid their choices they want information; and they appreciate straight-talking rather than flattery. When it comes to legacies in particular, they desire proof that any money given in a will should be spent wisely – the Boomers’ natural cynicism means that charities will have to work harder to prove the value and effectiveness of their actions.
So, to communicate effectively with Boomer legacy donors, charities need to find a new tone of voice, and a new set of messages.
From national institutions to rising stars
Legacy Foresight’s analysis shows that over the past two decades there has been a significant shift in the type of cause supported – away from the Victorian concerns of disability, domestic poverty relief and the advancement of religion, towards contemporary issues such as health, animal welfare and support for the armed services. Other buoyant sectors include air ambulances, hospices, NHS trusts and environmental charities. Educational organisations, including schools, universities and colleges are also performing well; especially when it comes to large bequests.
Many of these rising star causes have a strong local appeal. And, with an increasingly well-travelled, globally-aware donor base, charities with an international outlook are also gaining ground.
From direct marketing to… something completely different
Whatever the outcome of the FPS and the GDPR it seems clear that in the future, direct marketing will play a smaller part in the overall legacy ‘conversation’, while awareness raising (via advertising, social media, PR and branding) will become ever more important. Sector-wide initiatives such as Remember A Charity, Will to Give, Christian Legacy and Legacy Liverpool have an important role to play here.
At the same time, personal dialogue (at events, one-on-one communications by your legacy ‘champions’) and seeing/experiencing your services in action will remain vital ways to prove the value of leaving you a gift in their will. It may be that these channels – and others as yet unthought-of – will prove more effective at building meaningful lifelong relationships with supporters. In legacy giving, trust and confidence matter above all else. We believe that in the long term, the new fundraising environment may create opportunities to engage with supporters in far more appropriate, powerful ways.
Meg Abdy, Director, Legacy Foresight Ltd
Meg will be chairing the Legacy Giving Conference in York on 6th November. The conference is the first joint event from the Institute of Fundraising and the Institute of Legacy Management.