Tag - Blackbaud

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A Multi-Channel Giving Surprise
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2011 Online Giving
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2% Giving Flat for Forty Years
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Activists and Orgs Meeting Online
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Which is Better: More Donors or More $$$?
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Blackbaud Research on Online Giving
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Fundraising Using Social Media Tipping Point

A Multi-Channel Giving Surprise

I wrote last month about the continuing trend in the growth of online giving released in the annual online giving report by Blackbaud. While reviewing the materials on Blackbaud’s site, I stumbled on a previous research report, 2011 donorCentrics Internet and Multichannel Giving Benchmarking Report. Here’s the part that stopped me in my tracks:

The report notes that online giving is increasing, that online donors tend to be younger than direct mail donors and give less initially. But here’s the kicker, the data from 28 major national nonprofit organizations indicates that these organizations take the online donors and transition them to direct mail donors.

Hang on!

These organizations take new donors who came in online and put them in the direct mail slot? Why? I asked Frank Barry of Blackbaud that question. He agreed it sounded crazy, but the facts are that donors who convert from online to direct mail end up giving three times more. Given these data the desire to convert donors to direct mail makes sense – but only in the short run.

I hope organizations will take a longer view, which is that donors are capable of giving more online, but we need to get more intentional about how we engage them in conversation and action, and give them compelling reasons to give. Continuing to convert them to direct mail will ultimately be counter-productive because the cost of direct mail is very high, losing donors when they move is an industry hazard, and keeps donors in a tiny giving silo as opposed to enabling them to become doers, connectors, creators and fundraisers for causes.

Maybe his online and on land giving conversion is just a blip in time, part of the large transition we’re making, or at least I sure hope it is.

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2011 Online Giving

Blackbaud just released it’s 2011 Online Giving report, and as I have come to expect with Blackbaud’s reports, this one is chock full of interesting trends and tidbits.

For my data geek readers, the data come from, “… 24 months of online giving data from 1,895 nonprofit organizations, online major giving data from 2,397 nonprofits, and both online and offline data representing $5.1 billion in total fundraising from 1,560 nonprofits.”

A few highlights:

  • Taking out what they call “Large International Affairs” (natural disasters like the earthquake in Haiti not an Italian starlet have an affair with an international tycoon) online giving increased 13% last year.
  • Fourth quarter giving accounts for 34% of all online giving for the year.
  • The amounts for online giving are increasing, there are more instances of significant gifts (over $1,000) given online.
  • Online giving in the area of education is up 40% since 2010. I don’t see a specific reason for this in the report, my guess is because colleges are becoming more adept at connecting with their alumni online.

The trends have been clear for a few years, and further confirmed with these data; online giving is here to stay, most online giving happens when speed is important (year end and natural disasters), building relationships online (e.g. alumni) is a kaey to increasing giving.

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2% Giving Flat for Forty Years

Blackbaud released a report called Growing Philanthropy in the United States this week. Why do we need to grow philanthropy? Because:

In the U .S ., charitable giving is estimated to be only 2 percent of average household disposable (after tax) income (Giving USA Foundation 2011) . Regrettably, this is also the 40 year average for this figure, indicating that, despite an increasing marketing effort on the part of nonprofits (Sargeant and Jay 2010), individuals today are no more generous than their predecessors were over four decades ago . The picture is very similar in other countries (e .g . National Council for Voluntary Organizations 2010) .

I asked one of the authors, Jen Shang, to clarify how it is that we have so many nonprofits now than forty years ago but giving hasn’t increased. She said, “So the reason why total giving has been rising but not percentage of giving is because total household income has been rising.” In, addition, although Jen said it wasn’t the data they studied, we simply have more households than forty years ago, so giving would go up.

Nonetheless, the notion that after forty years of saturation by nonprofit marketers and the percentage of income we give hasn’t gone up. These data come from the annual report of Giving USA. Here is the total giving pie for 2010:

And now I’m confounded. After all of that running and cookie buying and dinners-gone-to there is no increase? Certainly the number of causes has increased exponentially, but so have the number of people, so maybe that’s a wash. I feel like I’m missing something big here. Are these data not including embedded giving where we feel like we’ve given a donation even if that gift is kept opaque by a corporation? Are we spending more time volunteering instead of writing checks? Are more of us giving the 2% than in previous generations?

Lucy, Katya, Amy, Tom…a little help, please?

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Activists and Orgs Meeting Online

Pew’s Center on the Internet and American Life has just released a study that creates a strong connection between Internet users and social causes.

According to the study:

“It becomes clear as people are asked about their activities that their use of the internet is having a wide-ranging impact on their engagement with civic, social, and religious groups.”

Here is a great table from the report summing up the major differences between Internet and non-Internet users and their engagement with causes:

The flip side of these results are the 2011 Nonprofit Communications Trend Report, a survey data from 780 nonprofit organizations courtesy of Kivi Leroux Miller.  According to this study:

  • 75% of nonprofits say they’ll email supporters at least monthly. Nonprofit Comm Trends Report http://kivilm.com/trends
  • Facebook comes after only websites and email as important communications tools for nonprofits http://kivilm.com/trends
  • 34% of nonprofits say Twitter is a very or somewhat important tool. Nonprofit Comm Trends Report. http://kivilm.com/trends
  • Facebook beats Twitter, 79% to 34% as important to nonprofit marketers. Nonprofit Comm Trends Report. http://kivilm.com/trends
  • What excites nonprofit communicators: new ways to connect w/ supporters, social media & better comm integration. http://kivilm.com/trends

All of our problems are solved, right? Nope, because the last bullet on Kivi’s summary list is this one:

What scares nonprofit communicators: money woes, hard-to-implement comm strategies & lack of staff time. http://kivilm.com/trends

Individuals are finding causes and becoming involved, according to a survey last year from Blackbaud donors that give online stay longer and give more and nonprofit organizations, and nonprofit organizations are increasingly, and successfully, using social media to connect with donors and activists.

And yet nonprofits are still bemoaning the fact that they cannot commit staff to social media. They could if it was important enough. How much time and energy are spent on activities that are unproductive and out-of-step with the social world, like direct mail, I wonder?

Given all of this evidence, plus the data showing the large amount of hours spent online by grown ups every month (Over 36 hours a month for people between the ages of 35-64, prime giving years), what is stopping every single nonprofit organization from putting every ounce of energy, every dollar they have, into building relationships online? What’s stopping them are senior executives and board members who refuse to believe that social media are important, who refuse to engage themselves, and think continuing to think and act in analog ways will continue to work.

That’s our challenge this year, to enlist everyone who is online, every staff person, volunteer and board member who is engaged and learning how to use the channels to raise awareness and activate people for their causes to make the case to the bottleneck people within their organizations that the above data are simply too compelling to wait another second before significantly reconfirming their budgets, staffs and structures and immerse themselves in the social world awaiting them.

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Which is Better: More Donors or More $$$?

The Minnesota Community Foundation has their second annual “Give to the Max Day” last week and once again it was a spectacular success.

The first giving day was last year. I had a chance to talk to the chief architect at the Minnesota Community Foundation, Jennifer Ford Reedy, a few months ago for my Social Good podcast for the Chronicle of Philanthropy.

It was a terrific example of a foundation forming partnerships with dozens of local nonprofits and a dozen other funders, creating an open source platform for giving (it was open source to enable and encourage other foundations to replicate the effort.) And at the end of the day, that first go round, the day generated 38,000 donors giving $14,000. I remember seeing those numbers on Beth’s blog and thinking that there had to be a typo. In the depths of the recession it was astounding to see that Minnesotans had given that much money to charitable causes. But, then, again, it’s Minnesotans, the most generous people in the world.

Jennifer posted a summary of this year’s event on the Council of Foundation’s blog last week. Jennifer outlined a key difference between this year’s event and last year’s. They decided this year to focus on increasing the number of donations not the size of the donations. They were successful in doing this, their bottom line this year was 42,000 donors pledging a total of $10 million.

As Jennifer writes, “we created an incentive system that rewards organizations for turnout.” The incentive were grand prizes of $20,000 and $10,000 to the nonprofits that raised the largest number of donors during the day.

This all raises a very interesting question: should nonprofits be aiming for more donors or more money?

Smart people like Kim Klein have been arguing for years that building a broad base of supporters is critical to long term sustainability for nonprofits.

But what if the needs are so great, winters in Minnesota are brutal after all, that losing $4 million hurts local people and communities in the most need right now?

I think part of the answer has to be what happens to these donors after they give on the big day? Blackbaud reports that donors who give online give more over time than their traditional counterparts. However, we reported that after the first America’s Giving Challenge sponsored by the Case Foundation that the winners didn’t know what to do with their online donors once they had them. That was three years ago, maybe we’re collectively getting better at learning how to build relationships with our online friends and turn them into long term donors now.

Maybe. At least I hope so! Katya, Kivi and Rebecca provide hopeful insights here on how to retain online donors.

This is, I suppose, the heart of our biggest challenge for the next few years; creating online friends, building stronger ties with a portion of them, asking them to give in real, authentic ways — and getting them to give again.

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Blackbaud Research on Online Giving

I had great fun last week keynoting Blackbaud’s annual North America conference in DC. Here is the video of the keynote that I did in person and Beth did virtually. Here is the video of our presentation:

I was very pleased by the response from the attendees, but it’s not what stuck with me for the day. I attended a presentation later in the day by Blackbaud. Chuck Longfield, the company’s head of research gave a presentation on the state of fundraising on land and on line that the company gathers from it’s 24,000 nonprofit users (quite a data set!) Here is a link to the findings they were reporting on. I asked Chuck if he was seeing any trends in the behavior of donors whose entry point is online. Do they give less over time? Do they give once and never again? Are the size of their donations less than the ones given by donors who begin through an in person event or through direct mail?

Chuck said it’s too early to tell the trends in this area. But he did share a very, very interesting data point.  He said that donors who come through traditional means like direct mail, who then transition to online giving, give more over time! Chuck said it’s as if giving easier online just makes people give more. This is fascinating and surely gives an incentive to organizations to try to transition their donors to online giving as soon as possible. I discussed with Chuck my interest in understanding donors who come in through social media and he agreed its a key research area in the near future.

 

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Fundraising Using Social Media Tipping Point

Blackbaud released a study last year that provided start evidence that fundraising through social media had not yet reached a maturation, much less tipping, point. The study (based on a very small sample of 24 nonprofit organizations that are significant because of their size) revealed that online giving was still just a tiny fraction of giving through direct mail and in person.

However, the earthquake in Haiti may have permanently changed sizes of the fundraising pie slices. According to a new study by the Pew Center for People and the Press, “Haiti Dominates Public’s Consciousness” (highlighted by Lucy Bernholz)  37% of giving since the earthquake in Haiti was giving online or by text message. And, we know that it hasn’t been small change, either, with the Red Cross reporting $22 million raised by text message one week after the earthquake.

So, have we reached the tipping point? I think so, but with a caveat and a caution (you didn’t think this was going to be straightforward, did you?)

Here’s the good news. It is clear that in the time of a disaster or an emergency a lot of people are ready and willing to give donations using social media. Donating by text, in particular, fits the bill perfectly. But millions of dollars have also been raised on Facebook, websites and Twitter.

But, here’s the drawback. One of the first lessons is that giving by text is easy for the donor but not so easy for the organization. It takes some time to set up the donation process with the mobile carrier (isn’t anything that involves a telecom going to be complicated somewhere along the line?) It is a cumbersome mechanism on the back end – it takes time to set up (the Red Cross that is so fortunate to have Wendy Harman on staff had already put this mechanism in place.) More disconcerting there is ordinarily a lag time between pledges made by text and the time the organization receives it because the phone bill has to be paid. The phone companies agreed to pay 80% of donations up front for Haitian relief because of the urgency of the situation. This also raises the issues of pledges made in the moment that may  not be paid later by the donor, unlike giving online using a credit card or PayPal.

The other important lesson is that just because text and, say, Twitter worked under these circumstances doesn’t mean that they are appropriate for other fundraising needs and efforts.

So, the bottom line for me right now is hooray for the increased trust and facility with a variety of social media tools that people are showing right now. However, that doesn’t mean that all of these fundraising channels are going to work for every organization in every circumstance. More reason, again, for organizations to continue to experiment with the tool set and focus on building relationships  through online social networks rather than just ask random people for money online — and to focus on learning what works for your organization over time.

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