In 2006, online fundraising is like a precocious adolescent: It’s maturing, its
promise is becoming clear, and it’s asserting its own unique personality within the family. Most importantly, it’s entering a growth spurt. According to the Pew Center for Internet and American Life, the number of Americans who reported that they had donated online to charity grew from 17 million to 26 million between January 2005 and September 2005.
You read that right: more than 1 million new donors a month, for eight months straight.
A slew of recent reports reveal that there’s much more depth and nuance to the online fundraising story than how many donors punched in their credit card numbers at a Web site. A group of online fundraising experts
reported in February that donations to nonprofit sector leaders rose by 40 percent over about the same period. The most successful online fundraisers are getting 20 percent or more of their total donations over the Internet.
Even more importantly, Luth Research recently found that 65 percent of all donors toured charities’ Web sites before writing a check, licking a stamp or attending an event.
Admittedly, online donations still amount to a relatively small slice of the overall pie, but all the trends point toward a not-too-distant future when the Internet will play a decisive role in nearly every charitable transaction.
Your main goals
There are five core tenets of online fundraising: Draw potential donors to your program, get them to identify with your work, convert them to donors, follow up appropriately to build the relationship, and then ask them to recruit their friends and family. These steps haven’t really changed since the late 1990s, although they’ve evolved.
Consider the example of Heifer International, one of the first charities to fully embrace the Internet. Heifer launched its ground-breaking, online “alternative-giving” catalog of livestock and agricultural products in 1997, promoted it to a small list of e-mail addresses and raised about $90,000. Fast-forward 10 years, and Heifer now promotes its Web site heavily via postal mail, e-mail, and an elaborate suite of online advertising and viral recruitment efforts — and raised more than $19 million in 2005. It tracks gift givers’ and receivers’ every click to build a detailed profile and tailor thank-you and other follow-up communications to enhance loyalty.
But while nonprofits still are exercising variations on the same five basic steps, the donating public’s online habits and expectations have changed a lot. Seventy-five percent of the American public now are Internet users, but online fundraisers should focus attention on the fact that more than half have migrated to “always-on,” high-speed broadband connections in the past few years.
The proliferation of high-speed Internet access is widening the gap between online fundraising and its older sibling, direct mail. Broadband households use the Internet very differently than dial-up households. Broadband users are more likely to use the Internet on any given day, much more likely to log on several times a day — and they’re far more likely than dial-up users to get political news; engage in financial transactions; download or upload photos, audio, and video; and read or write blogs.
The real distinction between a broadband connection and a dial-up connection isn’t speed; it’s the sophistication and comfort level of the person sitting at the keyboard. Broadband users can contribute more — and expect more — in an online relationship with a charity.
Here are five techniques that are successfully prompting them to donate money to a wide variety of charities:
#1 Emergency response
Relief charities certainly rose to the occasion when natural disasters struck in recent months and years, but an honest appraisal reveals much of the traffic and donations were driven by media coverage rather than appeals from the charities themselves. But that’s not the case for organizations such as the Humane Society of the United States, which had to stretch to connect its mission to Hurricane Katrina in the public’s mind — and raised $18 million to rescue abandoned pets along the Gulf Coast.
The clock is ticking down to the next incident that will underscore your organization’s value. Get yourself ready to move at a moment’s notice to place contextual ads with Google and Yahoo; revise your homepage copy and creative; and get the word out to your supporters, the media and “new media” such as bloggers.
#2 Alternative giving
Heifer International pioneered a modality of giving that’s catching on with socially conscious consumers and the nonprofits they support. The core value proposition is powerful: Instead of buying someone another gadget for her birthday or the holidays, give a gift to a nonprofit in her name. These alternative gifts transform the online shopping experience into
a values-based exchange between the donor, charity and gift recipient. What began as an online shopping cart in 1997 evolved into an array of alternative-gift shopping experiences.
Heifer International launched its Heifer Giving Registry, and others have created “Wish Lists” for those who want their friends and family to give them certain charity gifts for special events. Groups such as JustGive.org have created gift certificates that can be given as presents, allowing the recipient to choose what group to which the money goes. Using charity gift cards is increasing as a benefit. The possibilities for inserting charitable giving into the shopping experience are only as limited as the innovative nonprofit’s thinking.
#3 Social network fundraising
Social network fundraising is truly as old a concept as the first time a colleague asked a colleague to contribute to a cause he cared about. The most widely known examples of social network fundraising’s successes are “-a-thon” events such as Komen’s Race for the Cure, Easter Seal’s “Walk With Me” and the like. Tens of millions of dollars are being raised online through these proven programs.
Yet it doesn’t require a real-world event to leverage the power of social networks to raise money for your cause. The 2004 political season raised the profile of personal fundraising pages for political campaigns. Since then, a wide variety of organizations have put social network fundraising directly in their most passionate constituents’ hands. Adopters of this approach span the range of large to small, national and local organizations, to an engineering team of seven that raised $18,000 for its trip to Cameroon to field test ceramic water-filter technology. The outcome across the board? More dollars for causes and an expanded pool of new donors achieved through a highly efficient fundraising approach.
#4 Youth fundraising
The big question looming for all fundraisers is, “How do we engage the next generation of givers?” These “kids” grew up on computers, and their world view is different. Experts such as consultant Don Tapscott got it right as early as 1998, noting that the digital revolution, unlike previous ones, isn’t controlled just by adults. Today, there are only a few organizations that are inventing the future with these young adults. Two examples of ground-breaking work in this area are Amnesty International’s “Make Some Noise” campaign and PETA’s peta2.com effort.
Both initiatives have been designed around young people’s interests and modes of engagement. The efforts include music downloads, multimedia and cause-centric merchandise as program cornerstones. But these aren’t just window dressing on the old concept of cause-related merchandising.
These initiatives fully embrace the notions of youth community online through chats, instant messaging and viral communications. They go further and fully tap the creative energy of youth, making it possible for them to create their own personal spaces and content to share their enthusiasm for the cause. To get a glimpse of what the future of fundraising may be, take a tour.
#5 Build your list and convert
With more current and potential supporters accessing the Internet with high-speed connections, fundraisers have the opportunity — and the imperative — to offer more than well-crafted copy and appealing
graphics. Broadband Internet users are more likely to respond to movies, games and other multimedia efforts than static e-mails, and they’re more
likely to pass them along to their friends and family, too.
Here’s a recent example. The Quaker-affiliated social-justice organization American Friends Service Committee distributed its online movie, “Eyes Wide Open,” to an initial e-mail list of fewer than 20,000. Ten months later, more than a quarter million people have watched the online film. The effort has raised nearly $200,000 in online donations (not including additional gifts from follow-up fundraising) with a cost of less than 10 cents to raise a dollar.
Each of these approaches is laden with potential. But they’re not without threats to the very fundamental reason they succeed. In all our experiences, direct mail and e-mail remain the dominant tools driving individuals online to give. With direct-mail costs rising, the importance of e-mail outreach increases. Yet every online fundraiser should keep an eye on the mounting efforts by consumers and Internet providers to address the scourge of unsolicited commercial e-mail (spam).
More organizations and consumers are employing spam filters, programs that intercept suspicious e-mail before the user ever sees it. Even nonprofits that are rigorous about keeping clean lists of voluntary recipients are finding that at least some of their messages never get through. Spam filters are one reason that a consortium of nonprofit Internet experts recently determined that the rate at which supporters open e-mail from their charities had declined from 30 percent to 20 percent over the
past year. E-mail fatigue is another.
Internet service providers are looking at even more drastic steps. In February, America Online and Yahoo, two of the country’s largest e-mail providers, announced their intention to create tiered services — and charge as much as a penny per e-mail to “whitelist” and guarantee delivery of messages from bulk providers. Company spokespeople described the move entirely in terms of spam deterrence rather than as a revenue generator, and the jury is still out on how — and even if — this will work.
It’s too soon to tell if other companies will follow suit, or what other spam-control tactics might be on the horizon.
For now, the sun’s shining on online fundraising, and the winds are nudging you forward. If you have a great offer, strong copywriting and creative, and plan your cultivation to make a truly sustainable program, the time is now to invest in a robust, online fundraising program.
Michael Cervino is vice president and co-founder of Beaconfire Consulting, which helps nonprofits design, develop and implement Web sites and online
marketing programs. Eric Eckl is a senior consultant with the firm.