The Digital Divide – Part 1

We live in a rapidly changing multi-channel world that is “signed in”. Internet growth remains robust and rapid mobile internet adoption continues to accelerate. The advances in technology and the range of devices available to connect us to the internet are redefining the way we live, work, bank, shop, communicate and play.

E-commerce sales are skyrocketing across the developing world, in the UK in 2012  they reached £78bn and in 2013 they are expected to grow by 20%. A wide spectrum of industries have had to innovate their products, service delivery and communication strategy to keep pace with multichannel consumer expectation.

The charity sector has the same technology and communication challenges to deal with to maintain and grow donation levels. It has been wildly reported in 2012 and 2013 that charities are experiencing a significant drop in donations and even more concerning is the generation gap that is appearing.

CAF reported the total sum given to UK charities fell by 20% in real terms, from £11bn to £9.3bn during 2011-12, this is the largest drop in the survey’s eight-year history. This drop is concerning for those charities which rely on donations to provide vital frontline services. This combined with public spending cuts represents a potentially severe blow for many charities.

If donations continue to fall, many charities will face profound difficulties carrying on their work and the people and communities they serve will suffer. Britain remains one of the world’s most generous nations. But cash is tight for everyone and people are finding it harder and harder to find money to give to charity.

The research revealed that the over 60s are six times more generous than the under 30s. If this trend is not reversed there will be a damaging donation deficit when people of the older generations pass away.

In every industry, technology adoption flows upward from young to old. As brands start to deliver the shopping experiences that the younger generation seek, more consumers will start shopping the way younger consumers prefer to shop. Brands know they can’t ignore this generation and their unique shopping habits. They understand that if they capture their loyalty now they have a chance of keeping it for life.

Whilst it is great to read that charities’ social media activity has doubled over the last year, as I walk down the high street I am concerned. The endless charity shops and chuggers at every corner make me wonder if that rate of change in the charity sector is fast enough. Is the drop in donations and the generation gap more closely linked to the methods used as opposed to the pressures caused by current financial climate?

To fill the donation deficit and plug the generation gap charities we have to find a way to join the multichannel “signed in” world where the younger donors live and run their lives.  To turn Generation X and Y into regular givers the Charity sector needs to look to their ecommerce counterparts and better understand how to match the charity ask to these peoples  life style, means and existing behaviours.

Next month: The Digital Divide – Part 2 From retail to e-tail.