To help charities capitalize on the opening of the year-end giving season, a growing number of companies — including American Express, Walmart, and Apple — have introduced ways to make it easier for rank-and-file donors to give to their favorite causes.
While corporate efforts that support everyday giving are nothing new, they have matured significantly in the aftermath of the pandemic, says David Hessekiel, president of Engage for Good, an organization that conducts a twice-yearly study of fundraising campaigns at checkout counters. In the past, companies often relied on partnerships with big nonprofits, but today many of them typically allow customers to make gifts to any organization that has received charity status from the IRS.
These efforts are especially important because of the sharp decline in giving by middle-class donors. Fewer than half of Americans give to charity these days, compared with two-thirds in the early 2000s.
Now more companies want to help charities win back everyday donors — in part because more and more consumers say they want to do business with companies that demonstrate a strong sense of social purpose.
For charities, that means thinking about corporate grant making in more expansive ways, says Hessekiel.
“There’s been a huge sea change in not just looking at businesses as a cash register but also as a partner with connections to their customers,” he says. “Those can really open up opportunities for your organization to prosper.”
Customizing Customer Giving
Among the companies deploying a new giving drive is Walmart, which has long been a philanthropic powerhouse, donating $1.5 billion in cash and products to charity in its most recent fiscal year.
Walmart has also made it easy for its customers to give at the cash register. Since 1987, Walmart has raised over $1 billion through a checkout fundraising partnership with Children’s Miracle Network Hospitals. This fall, the company announced it will add to that effort with a new program called Spark Good, which allows online shoppers to round up their purchases to the nearest dollar to donate to charities of their choice.
The company designed the program with local nonprofits, which contributed feedback during the design process. While in-store checkout campaigns have typically focused on large organizations with local branches or efforts, the new system aims to give customers far more agency over where their donation goes, says Julie Gehrki, vice president of philanthropy at Walmart.
“We’re wired to care about the problems in our own backyard,” Gehrki says. Walmart’s new effort “allows us to bypass what often had to be a national organization and really live that belief of being a part of the local fabric in a tangible way.”
Tony Rodriguez, director of strategic partnerships at Candid, which collects data and provides analysis on foundations and nonprofits, says efforts like Walmart’s, which tap into the popularity of online shopping, will soon become a big part of nonprofit fundraising.
“Think about the last time you wrote a personal check to buy something — that doesn’t happen anymore,” says Rodriguez. “In philanthropy, we’re still writing checks, but we are definitely catching up.”
In October, Candid teamed up with Apple to allow nonprofits to receive donations through Apple Pay, a digital payment platform that boasts over 500 million users worldwide. People can now use Apple Pay to donate to any nonprofit that has earned Candid’s seal of transparency, which shows it has disclosed certain types of information to the public. Roughly 85,000 nonprofits are currently eligible under the new partnership. Candid says its aim was largely to make it easy for charities that don’t have their own donation-processing systems to attract funds, Rodriguez says.
“It’s leveling the fundraising playing field,” he says. “Nonprofits of any size, in any category or mission, have equal access to participate.”
Plus, the ability to use Apple Pay, a popular and secure payment method, could make it easier for middle-class donors — not just the ultrarich — to quickly and conveniently direct their giving to the charities of their choice. That, in turn, could boost giving overall from small donors, says Ann Mei Chang, CEO of Candid.
“What we’re doing here is removing friction,” she says.
Connecting With Younger Donors
Young donors. who tend to prefer shopping at companies that embrace a social or environmental mission, might be especially receptive to efforts that allow giving to be part of their consumer transactions.
In recent years, companies like Shell have embraced charitable giving as a means of connecting with customers. This year, the company brought back its Giving Pump effort for three months at more than 6,500 Shell stations across the country, allowing customers to use a designated pump to support 527 local children’s charities, including Boys & Girls Clubs, St. Jude Children’s Research Hospital, and the Make-a-Wish Foundation. This represents a significant scale-up from last year’s two-month version of the program, when the company raised over $1.5 million at more than 2,900 Shell stations.
Corporations increasingly recognize that if they provide technology that makes it easy to give, they stand a good chance of cultivating young donors — and customers — who are likely to have more dollars to spend and give in the future, says Katie Kelting, associate professor of marketing at Saint Louis University, whose work has focused on round-up giving campaigns.
“We’re just seeing this surge of corporations investing in this because they’re building these long-term relationships with their customers,” she says.
American Express is one company trying to do that. This summer, a survey by the financial services giant found that over 60 percent of Gen Z and millennial card holders — the company’s fastest-growing pool of customers — wanted to increase their charitable giving. Of those surveyed, one in three preferred an automated approach to giving, For instance, those surveyed say they wanted to be able to automatically round up purchases by a set amount and send them to charity.
“We heard from our card members that they wanted to figure out simpler and sustainable ways to give to charitable organizations,” says Lisa Yokoyama, vice president of product at the American Express innovation lab.
The survey results helped spark the launch of a new program in September, in which card members can round up their purchases to the nearest $1, $5, or $10 and contribute the funds to charities of their choice.
While round-up programs are not a new concept, the automation and customization available in the new program are novel, says Yokoyama. The program allows participants to choose from any of the more than 1.5 million charities registered with the IRS.
Unlike traditional round-up campaigns, donors can get help automating and tracking their donations through Philanthropi’s portfolio services.
By providing a means to give that is easy and allows donors a broad set of choices, Keith Leaphart, Philanthropi’s CEO, hopes to cultivate a whole new generation of philanthropists. For years, he says, the term has been applied to people who build a business and create a fortune before considering how to give. That, he says, is changing.
“Years ago, you had to sell a company and then get involved — that was when philanthropy was more of a destination,” he says. “Now it’s a journey. It’s about how we can support people on this journey, wherever they are.”
