Online Fundraising Goes Mainstream

Online giving is still growing, but triple-digit annual increases are a thing of the past.

Internet fundraising grew by roughly 13 percent last year, according to a survey of 100 of the largest nonprofits conducted by The Chronicle.

The Chronicle surveyed all the organizations in its Philanthropy 400 rankings of the largest nonprofits measured by annual fundraising. Of the 100 that responded, the Leukemia & Lymphoma Society topped the list, with more than $98-million in Internet gifts in 2013.

While online giving continues to gain steam, it still accounts for a very small portion of the money charities rely on. Among the 76 nonprofits that provided both their online and overall giving totals for 2013, the median share of online gifts is just 2 percent of all donations from private sources.

The results track closely with other recent studies of online giving:

• The Blackbaud Index found that online giving rose by 14 percent in 2013, compared with an increase in total giving of only 5 percent. The software company’s results are based on online-giving data from 3,359 nonprofits and overall giving data from 4,129 charities.
• Network for Good, a nonprofit that helps small and medium-size organizations raise money online, processed $190-million in online donations in 2013, up 20 percent over the previous year.

Integrated Fundraising

To keep the revenue flowing, nonprofits are testing online strategies carefully, integrating them with more traditional fundraising tactics, and hiring experts dedicated to online efforts.

The March of Dimes, for instance, used Twitter, Facebook and Instagram to raise money for its 2013 “March for Babies” fundraising events but still relied on face-to-face fundraising for more than three-quarters of the nearly $100-million it raised.

“I have yet to see pure online fundraising really take off,” says Patricia Goldman, the group’s chief marketing officer. “It has to be connected to the real world. That’s why we’re still doing runs, walks, and rides.”

Six charities more than doubled their online donations, including the University of Michigan, where Internet giving climbed 296 percent to reach nearly $20-million.

The university tried a number of techniques, like allowing donors to give to several schools using the same donation form and send online gifts as a tribute to someone special. But the biggest gain, nearly $14-million, came simply because starting in late 2012, people could make “preferred-seat donations” when buying season tickets online.

Some charities registered huge individual donations over the Internet.

The Museum of Fine Arts, Boston, for instance, received a donation of $150,000 while the University of Arizona at Tempe got a gift of $125,000.

To continue to spur growth in online giving, experts say charities will have to put energy and money into their online efforts. In the future, it won’t be enough to rely on the natural growth of the Internet.

“When you first start online fundraising, it’s so easy to get started and then to double how well you’ve done because those numbers are so low,” says Wendy Marinaccio Husman, a senior account executive at Donordigital, a consulting company. “But once you get more sophisticated, you have to invest more to keep getting that return.”

Biggest Online Gifts

Five organizations reported an online donation of $100,000 or more in 2013.