Context, communication, and the organization-donor relationship: towards a critical framework for understanding philanthropy in the arts

Abstract

This research was a mixed method, multiple case study of four small nonprofit arts organizations in Birmingham, Alabama. This study focused on small organizations for several reasons. First, their contributions to the cultural ecology of the community are highly significant and disproportionate to the modest resources they require. Second, justifications for arts funding are complex because they are based on a combination of intrinsic and instrumental benefits of arts participation. Third, the sector faces intense competition and a declining funding base. Finally, while small organizations dominate the nonprofit arts sector, there is a paucity of research in this area. There were four aspects of this study: explicating context, text analysis, in-depth interviews, and a co-orientation study. The literature review provided context necessary to understand the complexities of the nonprofit arts sector, how it is organized in society, and peculiarities of the arts economy. The text analysis investigated the use of various persuasive strategies in fundraising letters. The in-depth interviews investigated the perceptions of fundraisers and donors regarding intrinsic and instrumental benefits of arts participation. The co- orientation study investigated the organization-donor relationship along a series of relationship dimensions, cultivation strategies, and stewardship strategies. The text analysis showed that the fundraising letters were largely expository in nature, focusing on the programs offered and the number of individuals served. The use of persuasive strategies was quite constrained. The text analysis guide developed for the study compiled iii research from a variety of disciplines and may serve as a template for fundraisers wishing to craft effective arts funding appeals. The in-depth interviews identified donor and fundraiser perceptions regarding the benefits of arts participation, which pro-arts funding arguments were thought to be efficacious, what challenges small arts organizations face, who the beneficiaries of donations to the organization might be, and the reasons donors support the arts. Donor and fundraiser perceptions were also categorized along the arts benefits continuum proposed by McCarthy and colleagues (2004). Donors identified an extremely wide range of intrinsic and instrumental benefits, which suggests that typical justifications for arts funding might be unnecessarily constrained. The benefits identified in this study should help expand the discourse of arts philanthropy. The co-orientation study is methodologically significant because it is the first time co- orientation theory has been used to investigate the organization-donor relationship in the nonprofit arts context. Further, the co-orientation study was not conducted via survey; rather it was incorporated into the in-depth interviews. As a result, the co-orientation study generated rich qualitative data that otherwise would not have been available. Finally, the study showed that donors and fundraisers were in a high state of agreement along the relationship dimensions, cultivation strategies, and stewardship strategies.