Why Social Impact Brands Struggle to Attract, Grow, and Retain Revenue

Changing the norms and culture around social impact revenue across the entire sector takes time and energy. And kudos to the good people out there fighting that fight. But you’ve got to fund next year’s budget, and you don’t have time to wait for the culture at large to shift in your favor. You’ve got to find a way to make things work today. 

Because growing revenue for your organization isn’t optional. You have to secure the funding and resources you need to truly scale your mission. To attract and retain talented team members. To compensate them fairly and competitively. To cover your overhead and reinvest in your organizational growth and development. 

Cultural beliefs and norms about revenue for social impact organizations aren’t the only things that prevent them from reaching their revenue goals. There are other forces at play that make it hard to grow and sustain revenue for your mission.

Let’s get into it.

Why Social Impact Brands Struggle to Attract, Grow, and Retain Revenue for Their Missions

If you’re struggling to grow revenue for your social impact organization, you’re not alone. Let’s examine some of the common problems that many organizations face when trying to create sustainable revenue for their cause:

Number 1: Lack of Awareness

There are over 10 million global nonprofits and social enterprises in the world. The truth is, there are plenty of supporters out there who believe in your mission and would be willing to invest in it, but they can’t do that if they’re not aware of your brand. 

This is why we are so bullish on teaching social impact brands how to play and win in the attention economy. Today, garnering attention is half the battle. But it isn’t enough just to capture attention. 

Number 2: Converting Attention into Action 

Many social impact brands have built awareness for their cause, but they struggle to convert that awareness into action. If you aren’t able to transition those who are aware of your cause to actually support your work, it won’t help you grow revenue. 

If this is happening to you, there’s a number of things that could be going wrong here. You might not come off as credible or trustworthy as an organization. You might not be doing a good job communicating your impact. You might be vague about your mission and vision. Or, it might be the third issue:

Number 3: Cause Competition

As much as we don’t like to think about our peer and partner organizations in the social impact space as competitors, we have to realize that in the minds of supporters and donors, there are only so many organizations they can support. And you’re not just competing with other similar organizations, you’re competing with other investments, purchases, goods, and services that your supporters are budgeting for. When budgets are tight, philanthropy is often first on the chopping block. 

Number 4: Supporter Churn

Even if you’re successfully securing one-time gifts or purchases from your supporters or customers, you might be struggling to maintain healthy retention rates. On average, only about 34% of donors end up giving again. When 76% of your donor base churns, you’re going to need to invest a lot of time and energy attracting new supporters for your cause. 

Number 5: Narrow Revenue Streams

If your revenue isn’t diversified, you’re at risk of stagnation, or — even worse — unplanned disruptions to your revenue streams. A common problem with nonprofits is to rely too heavily on major grants from institutional funders, who change their funding priorities and leave nonprofits with massive budget gaps. 

Social enterprises often rely too heavily on a single product or service or model. This can work well at first, but leads to challenges breaking through revenue ceilings or even unexpected losses when consumer behaviors or market conditions change. 

Number 6: Lack of Capacity

The unfortunate truth for many social impact organizations is that being under-resourced means they aren’t able to invest properly in their team or build out effective revenue generation strategies. If you aren’t able to invest in the team or the capacity to build out intentional revenue streams, then you’re going to struggle to fund your mission properly. 

Number 7: Poor Supporter Experiences

This is often due to a lack of capacity, expertise, or the tools required to build out good donor or customer experiences or build a supportive community. 

Are you welcoming new supporters with effective outreach and communication to help nurture deeper relationships? Are you educating them on the importance of your work and your mission? Are you reassuring them that their support is important and is powering measurable impact for the cause they care about? 

If your supporter experience is lackluster, this will lead to churn and stagnation from your community. 

Number 8: Vague Impact

If potential or current supporters aren’t clear on your impact or progress towards your mission, then you’re going to struggle to attract new supporters or retain existing ones. You can’t assume that potential or even longtime supporters are in the loop on how your work is progressing. 

If you aren’t doing a good job telling specific, clear, and compelling stories and proof of impact, it’s going to prevent you from growing your revenue. 

Take Action

Of course, there are many other issues that can lead to revenue and growth challenges, but these are the ones that we see most often. 

If you’re struggling with some of these issues with revenue generation, not all is lost. These eight items are a good starting place for examining your revenue generation model. We encourage you to look through the list and take action on the elements you can affect. Consider how you can expand awareness. Look into building an Action Center. Seek out new funders and donors. Explore innovative ways to expand capacity. Lean into storytelling to communicate your impact and inspire support.

By bringing attention to these eight areas, you can put yourself on a path to creating a sustainable revenue mindset that will set you up for success today and into the future.