Online Fundraising Comes of Age

In the past few years, the Internet marketing revolution has excited and disappointed many fundraisers. Development professionals keep asking, “When will the Internet dollars start to consistently flow?” And the larger question: “What is the real value of the Internet in the nonprofit world?”

Though the Internet has not met many fundraisers’ expectations, it is starting to assume a significant role in the media mix. A recent survey of 1,080 nonprofit groups reported that 20 percent of charities seeking online donations receive more than 5 percent of their gifts via the Internet. Having worked for many years with The Salvation Army, we discovered the immense potential of Internet fundraising following the 9/11 disaster, which can be summarized with two key metrics:

· Within 48 hours, Salvation Army banner ads appeared on more than 2,200 Web sites.

· 33 million visitors went to the organization’s Web site, which translated into more than 18,000 gifts and nearly $2 million.

Since the early days of Internet-based fundraising, we have learned much about donor attitudes, intent and behavior online. From that experience comes several observations that frame opportunities for development officers and others engaged in fundraising programs:

· Donors are growing more comfortable with online giving and are sending huge gifts. One human services organization recently reported a $100,000 gift. The average online gift is two to three times that of direct mail.

· Nearly 60 percent of Internet users said they have used the Web to find information about nonprofit organizations; 40 percent of these users have made a donation online; 35 percent have signed an online petition; 35 percent refer friends online and 15 percent signed up as a volunteer.

· Nonprofit groups generally are not measuring direct and indirect Internet activity, and therefore cannot accurately assess the value of their investments on Web sites.

· Health organizations, including the Easter Seals, have found the Internet valuable in reaching younger audiences. Studies show that young people are not married to traditional direct mail and tend to be much more comfortable online.

· Some organizations have found that donors are more likely to respond to direct mail solicitations when a nonprofit sends an e-mail message in advance alerting them to watch for the solicitation in the mail.

· Nonprofit groups can use e-mail and Web site content to encourage constituents to participate in advocacy campaigns, volunteer, attend fundraising events and, of course, forward the message to friends.

Those encouraging findings notwithstanding, challenges remain in the online realm. Many stem from the sector’s collective inexperience with the medium, coupled with privacy and technology issues. Among them:

· Numerous campaigns sending hundreds of thousands of e-mails have produced virtually no response. Fundraisers are learning that traditional direct marketing strategies do not work with online marketing.

· One study reports that only 11 percent of people 56-71 and 7 percent of those 72 and older use the Internet to get information regarding charities or to make gifts. Many of those with the capacity to make charitable gifts are not yet using the Internet.

· 48 percent of donors with Internet access research nonprofits online but only 17 percent of those have given online. Donors, like consumers, make gifts or purchases where they feel comfortable. For many donors, direct mail remains the most comfortable form of giving.

· Tremendous concern exists about privacy legislation at the federal and state levels. There is talk of increasingly tough anti-spam legislation that would go beyond recently enacted measures such as CAN-SPAM. The outcomes of these initiatives could drastically alter how the Internet is used in fundraising.

· Consumers want spammers punished by the courts. California has legislation that would let computer users sue unwanted solicitors for up to $1 million.

Can these challenges be overcome? For the forward-thinking, socially responsible fundraiser, I believe they already are.

Naturally, there will be missteps, even for the most successful organizations. That’s the price of leadership. However, during this time of experimentation and understanding, nonprofit executives must not be disappointed or discouraged by initial efforts that do not appear to achieve expectations. Such setbacks most often are temporary, and the lessons they bring will pay huge dividends down the line.

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