I can remember exactly where I was and what I was doing the day I realized the Internet wasn’t a fad. Even back then computers were an everyday part of my professional career. But websites? Email? Banking and shopping online? Never! Today, not only do I believe the greatest invention of my lifetime is online banking, but the power of the Internet for business is undeniable.
So pigs are flying. If your non-profit organization does not have a comprehensive, integrated online strategy for giving, you are way behind. I am no Atticus Finch, but I am confident I can make my case for why online giving is a rising star of non-profit fundraising. I will approach my argument in two parts. First, I will make the case for online giving, NOW. Second, I will provide some practical ways you can get started or enhance your online giving.
Part 1 – Making the Case
First, it is important to understand the shifting generational demographics. Blackbaud’s report, The Next Generation of American Giving, outlines basic giving information for each of the four actively participating generations. It is no surprise that Boomers represent the largest portion of giving in both number of donors (51 million) and percentage of total individual giving (43%). After all, Boomers represent the largest segment of the population and are at an age where they are moving toward retirement or are in the sweet spot of their earning years. But it would be a mistake to ignore the growth trends of both Gen X and Gen Y.
While both Matures and Boomers say they plan to hold the line on their current giving levels with some modest increases, Gens Y and X say they plan to increase their giving over the next twelve months by 21% and 18% respectively.
Source: The Next Generation of American Giving – Blackbaud
Relative to communication behaviors and preferences:
- 85% of Americans are online,
- 61% send and receive email at least occasionally,
- over 51% bank online,
- only 40% of individuals below the age of 65 prefer to receive information by mail, and
- from 2007 to 2012, mail volume dropped by more than 25%.
How does all of this relate to giving? Before you think I have gone off the rails, I recognize that direct mail still dominates in sheer volume of giving, representing almost 80% of all gifts received. However:
- average revenue per new donor who joined online was 2x’s that of those who joined by mail,
- online giving still only represents about 6.4% of total fundraising according to the Blackbaud Charitable Giving Report of 2013, but, while overall fundraising is growing at less than 1%, online giving is increasing by almost 14%.
For the first time, more Boomers gave online (42%) than in response to direct mail (40%) during the past two years.
Perhaps the biggest indication of the changing winds is, for the first time, more Boomers gave online (42%) than in response to direct mail (40%) during the past two years.
What conclusions can we draw from this barrage of data? Let me paraphrase a few that Blackbaud poses in their findings:
- Seventy-seven million Boomers are likely to be the dominant source of donations for the next decade, but there are things organizations should do to attract younger supporters.
- It’s not just about tweaking tactics. Many of the biggest impediments to effective multi-channel fundraising are organizational and political.
- Don’t phase out direct mail yet, but have a “succession plan.” It is declining as the dominant source of direct marketing income, and there is no indication the trend will reverse.
Part 2 – Making the Change
I am no expert in online marketing. I am a fundraising consultant who works to help my clients maximize their return and create an integrated, donor-centric fundraising mindset. I try to pay attention – and gather good resources who are experts around me – to help my clients stay ahead. With that in mind, I will share a few thoughts on how your organization can either get started or enhance your online presence.
There are three primary variables to pay attention to in order to exponentially grow online giving:
Web Traffic x Conversion Rate x Amount Raised = Exponential Online Giving
Your website is a potential donor acquisition funnel if you:
- can be found,
- make a compelling argument for why they should stay,
- have specific and intentional paths to become a participant,
- create a meaningful and easy giving experience.
Do you have a written multichannel marketing plan that “cross-pollinates” your online and offline marketing efforts? And a documented content strategy? Are you willing to invest a part of your marketing budget for online fundraising activity? The online portion of your marketing plan is about considering all the different ways people might come to your site – through search engines, social media, your blog, email blasts, advertising, etc. – and developing a strategic plan to optimize the platforms that have the most potential.
Is your website designed with search engine optimization (SEO) in mind or is it a cyber “ghost ship?” If you can’t be found through an online search for specific keywords related to your mission, the only people who are finding you are the ones who already know you exist.
Understand that social media is not a stand-alone and separate element of your marketing effort; it helps drive traffic to your website. By design, the best websites have content growth and change. Search engines “like” dynamic content and depth of content but just as importantly, new and original content is valuable and gives people a reason to visit your site over and over again. This is one of the reasons why blogs are now the rule rather than the exception.
An Aberdeen Group/Hubspot study shows that content marketing costs 62% less than traditional marketing and generates greater results in leads, conversions, growth, and money raised.
- Have a written multichannel marketing strategy for fundraising.
- Measure your online traffic through Google Analytics or similar tools and appropriately benchmark those results.
- When building a website choose a marketing firm that has in-depth expertise in website design, SEO and online marketing because all three are critical. If your website is less than 3-years-old and you’re budget doesn’t allow for a redesign, there are often improvements that can be made that will help in the meantime.
- Invest in expertise in online donor acquisition and retention. With a recent client, we recommended beginning to limit some mail acquisition activities and re-invest a portion of those funds in online marketing.
What percentage of your website visitors take action upon visiting (such as leaving their name and email address)? For those who go to your website donation page, what percentage follow through with a donation? According to the most recent Online Marketing Benchmark Study for Nonprofits, the median conversion rate for providing an email address is 2.04% of unique visitors. Even if a visitor finds their way to your donation page, only 15% give according to the 2014 M & R Benchmark Study.
Getting people to your website is only part of the equation; conversions is another. A conversion is a desired action such as providing an email address, requesting information or making a donation. If your site is not designed with conversion paths in mind, you are looking at a significant missed opportunity. If a web designer doesn’t ask you for a prioritized list of desired conversions, find a new designer who does.
The most effective donations pages answer three questions at a glance: Where am I? What am I doing here? Why should I do it? They visually show the impact of donating. They are uncluttered, focused and eliminate extraneous pathways off the page. The best advice I can give is test, test, test.
- Make a list of desired conversions for your website and prioritize them. Using this list as the measuring stick, how does your site measure up? If it doesn’t measure up well and your site is more than 3-years-old, it may be time to start thinking about a new site.
- Have you A/B tested your donations page? Untested donations pages convert less than the 15% median.
- Look at other nonprofit websites, particularly those of larger organizations such as World Vision, ASPCA and Audubon. Analyze their designs based on conversions and compare them with your site.
Do you know what your average one-time online gift is? How about how many of those first time donors are giving again the next year, or the next? How fast is your online giving growing compared to other giving channels? If you haven’t done this kind of research, you’re likely to be surprised.
Online donors giving a one-time gift average about $136 compared to between $30 and $50 for a one-time mail gift. Monthly sustaining donors are retained at about 70% to 80% compared to 30% to 50% for one time givers. Sustainers average about $31 per month or over $360 annually. Unfortunately only about 15% of online giving on average comes from monthly sustaining donors. Can you say “opportunity?” Here are some suggestions.
Source: Nonprofit Research Collaborative
- Branded donations pages result in 6X more dollars raised than unbranded. Simply hanging out a “Give Here” sign is not sufficient.
- There is no one-size-fits-all formula for creating donation pages that work, but there are some “best practices.” Testing will help you determine what works best.
- Providing a rationale for gift stream levels gives the donor a better idea how their giving at certain levels will make a difference.
- Branding and marketing your monthly sustaining giving program and making it prominent and simple to join will increase participation.
- Recurring donors give more and are more loyal. Consider making recurring gifts a bigger priority than one-time gifts when designing your site and creating conversion paths. Minnesota Public Radio made monthly giving the default on their donations page which resulted in sustainers becoming 60% of their revenue.
- Try creative ideas. One organization made their donation page the home page on December 31st to make it easier for year-end givers.
Online giving is increasingly a more important piece of a strategic, integrated development plan. Large nonprofits such as the American Cancer Society are already redirecting significant portions of their budget out of direct mail donor acquisition efforts into other channels. It remains your responsibility to understand donor motivations for giving, deepen the relationships, and grow donors seamlessly to their maximum level of giving using a multi-channel approach.
Let me conclude by saying there is way too much too cover in one article. To dive in deeper, contact the Fundraising Resource Group and ask for a link to our free webinar, Flying Pigs: The Case for Online Giving Now; there are visual examples and much more on the subject of donations pages, monthly giving and other specific ideas. (By the way, we are not in the website design or online marketing business so this is not a sales pitch!)
My advice if you choose to ignore online giving is, watch out for flying pigs.
Written by Daniel Neel, President of The Fundraising Resource Group. This article was first published in the July 2014 issue of Dimensions magazine, a publication of the National Catholic Development Conference.
The Fundraising Resource Group helps non-profit organizations across the United States with fundraising feasibility studies, capital campaigns, annual giving campaigns, major gift fundraising, non-profit marketing, fundraising training, and other high-impact, high-return fundraising activities. For more about how we can help your non-profit achieve fundraising success, visit our website at www.thefundraisingresource.com or call 888-522-1492.