This report about online fundraising was researched and written by Debra E. Blum, Heather Joslyn, Drew Lindsay, and Megan O’Neil.
Bryan Breckenridge is a tech evangelist. As executive director of Box.org, a San Francisco Bay Area nonprofit, he helps charities such as Teach for America and Livestrong put cloud-based technologies to use. And like any good evangelist, he embeds personal testimony into his gospel message.
Mr. Breckenridge’s story starts with an email sent last year by the nonprofit RISE Yoga for Youth, a program to introduce yoga in schools and to adolescent groups. The message was nothing unusual: The organization, which was raising $30,000 to double its reach, wanted Mr. Breckenridge — a father, yoga fan, and RISE supporter — to talk up the campaign on social media. But the email came with a link to a cloud-based folder loaded with tools to help, including a PowerPoint presentation, images, sample emails, and a fundraising schedule.
In just a few clicks, Mr. Breckenridge exported thousands of his personal and professional contacts and fired off an email on behalf of RISE. The task was easy, the result enormously satisfying.
“Lots and lots of my colleagues came through,” he says. Other campaign volunteers hit pay dirt as well, and the group soon achieved its goal.
Mr. Breckenridge’s tale illustrates the transformative promise of online fundraising that tech advocates have been talking about for years. In the future that they envision, nonprofits take a quantum leap beyond slapping “donate now” buttons on their websites to build dynamic communities of supporters on the Internet and through social media. These communities serve as powerful auxiliaries, with members using their phones, computers, and technology we can only dream about to extend an organization’s reach and mobilize people who might never have heard of the group or the cause.
It’s heady stuff that lights fires of ambition. What if technology could power philanthropy to unimaginable new heights? Might giving finally smash through the 2-percent-of-GDP rate?
Such dreamy forecasts about online fundraising have been circulating for decades — so long, in fact, that you might ask: When exactly is the future going to come?
Other industries have been torn down and rebuilt along digital lines since the Internet became a part of everyday life and commerce in the 1990s. Fundraising, however, seems stuck in time, with nonprofits struggling just to master the rudiments of a good website. Money for tech investments is tight, of course, but many leaders don’t seem to care. They see online fundraising not as a game-changer but as a handy but limited add-on to their traditional operation.
“A lot of people in serious positions of authority in the nonprofit world are happily declaring themselves as novices,” says Henry Timms, founder of Giving Tuesday, the booming post-Thanksgiving event in which nonprofits collectively seek out gifts both online and off.
“I don’t think that’s sustainable. This is going to be essential to anyone who’s trying to make social change in the world.”
Disappointing Growth
The short history of online fundraising is not without signs of progress. Online-giving websites such as Global Giving have emerged to give thousands of small nonprofits and social entrepreneurs their first Internet presence and access to donors who are miles, if not continents, away. DonorsChoose.org, which was born online and has the Internet baked into its name, is working out the mechanics of what it takes to raise money online, whether testing website colors, fonts, and images or pumping out computer-generated email solicitations tailored to a user’s interests.
Year to year, more people give money online to charity. Network for Good reports that online giving grew by 9 percent last year, triple the growth rate for fundraising over all. Higher education saw its online giving climb almost 17 percent in 2014, according to Blackbaud, while medical-research organizations raised almost one in five dollars from the Internet.
Still, for most charities, online giving represents a sliver of their overall fundraising. On average, U.S. nonprofits raise no more than 10 percent of their donations online, and often much less. A Chronicle survey of 76 of America’s biggest charities found the median share of online gifts represented just 2 percent of all donations from private sources in 2013.
Those numbers are humbling. “Everyone thought the ‘donate now’ button added to websites in the 1990s would change the world,” says Heather Mansfield, author of Mobile for Good: A How-To Fundraising Guide for Nonprofits. “Now, with 7, 8, 9 percent of giving online, that’s progress, but that’s really frustratingly slow progress.”
Why is the promised revolution moving at glacial speed? Many nonprofits say their tech infrastructure dates to the Stone Age of the digital era and they lack resources to upgrade. Even if they have cash, the tech marketplace is filled with so many providers and services that it can be as bewildering as a Turkish bazaar.
More important, many fundraisers admit they’re ambivalent about moving their business online. They praise the Internet’s convenience for donors and organizations alike, and they say it’s a great tool when they need quick cash for a natural disaster, a wartime refugee crisis, or some other emergency. Online systems also are effective at nudging people to sign up for deadline-driven fundraising events like galas and walkathons, some people say.
But many groups are wary of moving more fundraising to the Internet. The Jewish United Fund/Jewish Federation of Metropolitan Chicago is one organization that’s building slowly and cautiously. It has created a healthy online presence, with an active Facebook page and Twitter feed, and it’s used the Internet to mobilize donors to raise money for emergencies, including the recent earthquake in Nepal.
Still, the group’s leaders staunchly believe that online operations are simply one component of an integrated campaign — and one with limited potential. Altogether, less than 10 percent of the organization’s gifts come in online each year. Many of those, officials believe, are made by supporters using its Internet portal only because it’s more convenient than mailing a check.
Rachel Sternberg, senior vice president for campaigns, says the Internet is an effective medium to carry messages and help the organization connect with lots of donors at once. To do more online, she says, would threaten the longstanding personal relationships that are at the heart of the organization’s purpose.
“A big piece of our mission is engagement and creating experiences and connections for the community,” she says. “We are about outreach and connection. We are not just about raising money.”
Ultimately, she worries that eliminating human interaction from the giving process robs it of the emotion that fuels philanthropy. “To give online and have that replace going to an event or speaking to a human being, that’s not really our goal.”
Gary Laermer of the YMCA of Greater New York has similar concerns. He sees value in an active social-media presence and uses Facebook and Twitter to research prospects. The organization even snared a five-figure gift from a supporter identified only after she tweeted her thanks when the Y’s swimming pools reopened after 2012’s Hurricane Sandy.
But online fundraising itself? He’s not convinced it offers a big payoff. His handshakes and coffees and stewardship are much more likely to win a donor’s loyalty and repeat gifts, he says. “I’m not all that interested in eliminating the human experience from philanthropy.”
Moving the Needle
The skeptics are right about one thing: Time-tested principles of fundraising shouldn’t be jettisoned simply to pick up something new and shiny. Indeed, judging by retail sales data, the nonprofit industry may be moving at an appropriately deliberate pace in its adoption of technology.
Even in the age of Amazon and Zappos, e-commerce accounted for just 6.5 percent of national retail sales last year. Brick and mortar still dominates that arena, just as direct mail, events, and face-to-face meetings remain the linchpins of fundraising.
Still, it’s clear the ground is moving under the feet of every nonprofit in America as demographics shift. “We are getting into the very first groups of people who were basically raised with the Internet, with technology,” says Brenna Holmes, vice president for digital at Champman Cubine Adams and Hussey, a marketing firm with nonprofit clients. “And there is no way that won’t affect how we all make our choices to interact with charities.”
Tech advocates worry that nonprofits aren’t making even the relatively inexpensive adjustments that are low-hanging fruit. Nearly two-thirds of nonprofits have donation landing pages buried three clicks or more into their websites, according to a study of more than 150 charities last year by Dunham and Company, a Texas-based fundraising consultant, and the fundraising think tank Next After. Nearly 80 percent don’t even personalize email appeals with a potential supporter’s name.
Perhaps most worrisome: 84 percent of nonprofits haven’t optimized their website donation landing pages for viewing on smartphones and tablets.
“Enough nonprofits just aren’t doing the most basic things they need to do to move the needle,” says Brad Davies, a Dunham executive.
The comparable rates of online retail sales and online giving may offer comfort now, but expect a divergence: Corporate America will continue to invest in and enhance the user experience for customers as nonprofits fall further behind on the tech curve. Interacting with a charity online after surfing a business site may soon feel like riding a stage coach.
“The expectations of our constituents are being set by Apple and Amazon and Instagram — huge organizations that have massive personalization capability,” says Jeff Shuck, chief executive of Plenty, a Chicago consulting firm for nonprofits. “Yet we’ve got nonprofits still struggling with eight different databases that don’t talk to each other. It’s just not sustainable.”
Though investing in digital upgrades is important, tech advocates argue that it’s more critical to flip the mind-set of nonprofit leaders. Top executives and board members, they say, don’t understand that effective online fundraising merges digital strategies with principles that have guided the field for years.
Crowdfunding campaigns are a good example. Just as a capital campaign doesn’t go public until it’s secured the momentum of a few major gifts, smart crowdfunders don’t move online until their campaign is well beyond $0 and clearly headed toward its goal — often thanks to the generosity of a big donor or two.
“Nonprofits are just learning how to do that and translate their momentum offline into online fundraisers,” says Breanna DiGiammarino, co-head of Indiegogo Life, an offshoot of the crowdfunding site Indiegogo that helps individuals raise money for their personal needs.
Most important, proponents say, effective online fundraising doesn’t eliminate the human touch at the core of giving. Rather, it does the opposite, expanding the number of people advocating for a cause and creating a community whose bonding force is an organization’s mission. Some individuals in these virtual communities hover at its margins, engaging only rarely. That’s true of a physical community as well. But the core members will take on roles as ambassadors for the cause or even as fundraisers. They become owners, not donors, says Henry Timms, and this in turn will deepen their engagement even as their enthusiasm draws in more people.
Mr. Timms is perhaps the most prominent and articulate spokesman for this view of online fundraising. Though his day job is executive director of New York’s 92nd Street Y, he’s celebrated as the founder of Giving Tuesday, the fundraising event that raised $46 million last year — double its take from 2012, when it began.
Mr. Timms pushes back against those who see online fundraising as a cold, sterile venture that short-circuits donor engagement. “The idea that somehow digital is impersonal is an absurdity,” he says. “The default response to the digital world by those who fear it is, ‘This isn’t real. It’s not how humans really interact.’ "
Yet every day, he says, you see more meaning and substance on the Internet, more people forging thoughtful, deep connections — deeper connections, perhaps, than a professional fundraiser could ever hope for with a yearly newsletter. Online communities can be places teeming with passion and energy, he says, and fundraisers need to carve out time now to explore them, understand their dynamics, and test how to build them.
“Our job is to find meaning and purpose,” he says, “and we have to go search for that.”
