In recent weeks we’ve been asked about the possible impact of Coronavirus on this year’s in-memory giving. Compared to legacies, we don’t have a hard foundation of sector data to build on, so it’s not possible to produce numerical forecasts. But we’ve done some initial thinking on the main drivers that are likely to be impacted by the pandemic.
Research from Imperial College London suggests that – given the measures that the government has currently put in place – the coronavirus pandemic could cause in the range of 20-40,000 deaths in the UK across 2020 and 2021. Legacy Foresight’s estimate (based on actuarial analysis) is that around 30% of the predicted deaths from coronavirus would probably have happened over the next five years under ‘normal’ circumstances, albeit from different causes. Deaths from coronavirus will continue to account for a tiny proportion of overall deaths (between 2% and 5%, according to our scenarios).
When considering the impact on in-memory giving, it’s just as important to think about the broader effects of the pandemic on non-coronavirus related bereavements. Total deaths in 2020 are expected to be between 630,000 and 650,000. That’s a vast number of relatives and friends whose loved ones will die from other causes, yet who will still be impacted by the repercussions of the pandemic on their daily life and their ability to mourn their loss.
If you consider the break-down of in-memory donation value across the sector, funeral collections and events are by far the most important channels, accounting for 36% and 33% of in-memory value respectively (Legacy Foresight Populus research, 2019).
Funeral collections are one crucial area in which the impact of the changes is hard to predict. On the one hand, social distancing and the (temporary) effective dissolution of memorial services suggests that funeral giving to charities will be severely diminished, at least in the short-term.
However, we think there may be a ‘delay effect’ – where people who have been unable to give their loved ones the send-off they’d have wanted at the time of their death, will wait until restrictions have lifted to organise the memorial event of their choice.
There are, of course, no guarantees that these postponed memorial events will feature charity collections – although how effectively charities engage with donors in the interim could well have a bearing on how many do.
The type of charities benefitting from in-memory giving may change over this period. The current tidal wave of good feeling towards the NHS might cause a redirection effect, with more next-of-kin nominating NHS charities and hospices as in-memory beneficiaries. We could well see the inauguration of a large-scale, national remembrance event for everyone lost over the period, with donations directed at NHS staff and perhaps other key workers such as care home workers. Rather than benefitting charities in the traditional way, this giving could be focused on the NHS as a body or umbrella organisations such as the Community Foundation’s Coronavirus Response and Recovery Fund; or go direct to individual heroes.
It seems likely that this could be at the cost of other health charities (e.g. cancer and heart disease), particularly for coronavirus-related deaths. The experience of losing a loved one to coronavirus does not accommodate the building up of strong personal connection with a supportive charity, as say, a loved one’s experience of cancer might do. However these ‘normal’ journeys are also being affected. Face to face contacts (such as meetings with a Macmillan nurse) – recognised as such critical drivers in building connections that lead to an in-memory gift – are severely limited. But, as our stewardship research suggests, if people feel they are being supported with kindness and care in other ways (e.g. by phone), many will still want to give back.
The distancing and reduced level of connection with cause of death charities could increase families’ motivation to choose loved in life charities for remembrance, particularly if they delay a memorial service and are determined to hold an uplifting and celebratory event. Those charities they associate with the passions and values of their loved one in happier times may be favoured. This may be even more likely if the circumstances of their loved one’s death have been painful and tragic, affording them little time to prepare.
The fundraising events market is expected to suffer badly as the result of social distancing over the summer, with events like the London Marathon – popular with in-memory supporters – postponed or cancelled. This will undoubtedly affect charities’ short-term in-memory income (even if in-memory motivated event donations are not always easy to identify and measure).
We think we may see a national rush to reschedule events (both commercial and charity) to the early months of autumn or as soon as restrictions are lifted. This could quickly saturate the events calendar and make things more challenging for charities’ in-memory teams and individual fundraisers alike.
Economic downturn – now forecast as an unavoidable outcome of the pandemic – could impact on people’s capacity to give. People’s tendency to give to charity does not change drastically when times are hard. Research suggests that a 10% reduction in income leads to around a 1-3% reduction in individual giving. Our current estimate is that GDP could fall by around 7%, which suggests around a 1% reduction in individual giving.
This sounds like a minor amount and is not specific to in-memory giving. However, in-memory donor fatigue could increase if – for example – after the lifting of social restrictions, people find themselves attending many more funerals, or face more calls on their purse from a rush of charity events.
In summary, despite the increase in deaths caused by coronavirus, we expect to see an overall downturn of in-memory income across the sector this year. We predict that the main driver of this decline will be the restrictions on funerals affecting all bereavements – and uncertainty about how much of this income charities will receive in postponed giving over the short to medium term. The temporary collapse of the fundraising events market will exacerbate this in the short-term.
However, if charities can continue to focus on in-memory donors’ motivation for getting involved – their ‘why’ – steward them open-heartedly through the worst period; and adapt flexibly to social change, there is no reason why in-memory income should not be stronger than ever from next year onwards.
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