Online giving: A lively spot in the lackluster economy
- Thu, November 05 2009
- Filed under: Fundraising essentials
We just had a happy moment at my job. In a sign of the steady growth in online giving, even amid the recent recession, Network for Good has now processed over $300 million in online donations to more than 50,000 charities since we got started. This year, we’ve distributed money to 60% more charities than last year. The average Network for Good nonprofit is raising the same dollar amounts as in 2008, through more, smaller gifts. To illustrate, the total number of donations through Network for Good is up 92% year to date, but the dollar value of those donations is up 43% compared to last year.
That is good news.
My colleague Kate Olsen has observed the following trends:
•The economy is fragile, but giving online is going strong. Network for Good is seeing double the number of donations this year, just at lower dollar amounts than in years past. The growth in online giving is particularly encouraging in comparison to offline giving trends.
•Recurring gifts are a lifeline to nonprofits during a recession. A steady number of donors are setting up automatic monthly, quarterly or annual gifts that provide dependable and compounding cash flow for recipient organizations. At Network for Good, 1 in 5 gifts is a recurring donation this year, which is comparable to last year.
•More people are giving the gift of charity to others. Year-to-date sales of Network for Good’s charity gift card (The Good Card) are up 60%, as more individuals and companies choose to say Thank You, Congratulations, and Happy Holidays with the gift of charity. Repeat after me: No more ties! No more scarves!
•A rise in grassroots and peer-to-peer fundraising is driving more donation activity online. For any given charity, the most significant source of donations is its own website, but Network for Good is seeing ten-fold growth this year to date in donations made through social networking sites like Causes on Facebook, Change.org and others.
•Corporations increasingly insert philanthropy into their marketing and rewards programs. Corporate giving programs like the Capital One “No Hassle” Giving Site make it easy use your card to give to any charity on your card or to donate rewards (with no fees taken out). You’re also going to see more and more so-called embedded giving, which inserts a charitable donation into a commercial transaction. This can be a mixed bag for the sector, as Lucy points out, but it is not going away.
The even better news is the best is yet to come - annually, about 40% of giving occurs in December alone.
So why is all this happening? Is this trend just cannibalized offline gifts?
Not really. Steve from Blackbaud gave a great review of his data today via NTEN, and it tells a story that is consistent with what we’re seeing. Namely, online giving is growing fast (even though it’s still only 5% of overall giving), it brings in younger, wealthier and higher-dollar givers, and it’s a top source of new donors. So you can’t really choose to ignore it. But you also shouldn’t choose to ignore other forms of fundraising. Online donors often give offline after giving online. That raises an interesting issue - we talk a lot about online donors renewing at lower rates and switching to offline giving - while offline givers don’t typically switch to online. I’m not sure how much of this is the donors and how much of it is how and where we cultivate them. I think it’s a mixture of both - which is what Steve said today as well.
1. You’re nuts if you’re not doing online fundraising, especially this December when online giving will peak for the year.
2. You need to remember online donors are more loyal when they are cultivated through many channels - online and off. So be expansive when thinking about how to build a relationship with them in the New Year.
Comments
Great post Katya! Customers at LavishGiving receive a Good Card worth 10% of their purchase - and although this couldn’t have been a worse time to start a new business, feedback from our customers has been absolutely marvelous - they are loving the opportunity to shop for the things they want to buy anyway, and at the same time effortlessly raise money for the causes they care about. We are a very small fish in this pond, but every little helps - and with the credibility of Network For Good behind us, powering the donations, we’re hoping that holiday sales will generate considerable funds for many different charities. So while giving is down across the board, by encouraging consumers to shop with stores and services that give back a % - and there are plenty of us - hopefully this holiday season we can all make a difference.
This is a great post. Another reminder that all dot orgs should have automatic recurring gift capabilities and the option for people to donate online.