E-Fundraising
E-fundraising is gaining momentum, and no campaign would be complete without it. It is estimated 85 percent of all adults spend time on the web, and to reach this audience — especially younger generations — you need an online presence in order to build your database of supporters.
E-Fundraising Today
E-fundraising may be the most appealing of all strategies because it is a low-cost way to generate revenue, allowing for a larger share of funds to directly support a cause. Although it is a relatively new strategy, the future of e-fundraising is just beginning to reach new heights.
E-fundraising is picking up steam thanks in part to new partners. In 2007, YouTube launched an initiative in which nonprofits in the United States with 501(c)(3) tax filing status can register for a free nonprofit-specific YouTube channel. They can upload footage of their work, public service announcements, calls to action, and more. Through this channel, they can also collect donations with no processing costs, thanks to Google's Checkout for Non-profits. Other initiatives, such as JustGive (
Evaluating E-Fundraising
E-fundraising requires significantly lower expenses than other established methods, such as phone solicitation or direct mailings. It costs almost nothing to send mass e-mails, including fundraising appeals, invitations, information on upcoming events, and thank yous. Your organization can save money on printing, postage, and the services of a mailing house.
Still, some people remain skeptical about e-fundraising. Stories of stolen identities and fraudulent charities create uneasiness among potential contributors. Nonetheless, once a nonprofit has established its presence and reputation, the Internet can prove less expensive than direct mail campaigns for reaching a mass audience. The site should convince donors it offers web security, no personal information will be shared or sold elsewhere (include a privacy policy), and donors' money will be used for the reasons for which it was donated.
State and local governments have regulations and guidelines regarding what they consider charitable solicitation. In some cases, it may be necessary to register as a charitable organization in other states before you can solicit funds via the Internet. It is advisable to talk with a lawyer about this issue.
New Frontiers
Another growing trend has for-profit businesses providing space for non-profits or teaming to offer ways in which to donate money to your organization through their websites.
Even if e-fundraising does not make up the bulk of your revenue, use your website to promote activities, raise awareness, and recruit new volunteers. It is also a beneficial tool in the event of emergency situations such as the September 11 terrorist attacks, Hurricane Katrina, and other devastating hurricanes or floods around the world. The Internet provides the immediacy that allows people to donate to help the victims of such disasters as quickly as possible.
Pros and Cons of Internet Fundraising
Advantages of e-fundraising include the following:
Your organization can reach more people in less time than ever before.
Costs are relatively low.
If your e-fundraising capabilities are set up correctly, people can respond immediately to requests for donations.
You can respond quickly to donors' questions and concerns through e-mail.
You can update information on a daily basis and keep people abreast of the latest news and activities in your organization or regarding your topic of interest.
More people will find your site if you work to get your name in as many places as possible Get like-minded organizations to trade links with your site. People who are interested in one site can easily find other causes that inspire them.
While you certainly want to have a web presence, there are reasons why you should limit your time and efforts on e-fundraising. The disadvantages include the following:
In general, people are still hesitant about giving money online unless they are confident you will receive it and their privacy will be protected.
There is a tremendous amount of competition on the Internet for donations and unless you have major marketing dollars or a plan and the time to institute a grassroots marketing campaign, it is unlikely you will be able to stand out from the crowd.
Hackers, viruses, and technical problems can wreak havoc with your site and you can lose data, including pledges or donations.
It takes constant work on your website to keep it current.
Despite the disadvantages, it is worthwhile to establish a web presence and put a system in place to collect donations or at least pledges. If nothing else, promote your site as much as possible so people can read about the work you do and get information about the cause you are supporting.
Requirements for E-Fundraising
To effectively receive contributions online, you will need a service that allows you to process credit cards, a web page set up to accept credit card information, and a merchant services account with a bank or third-party provider. You should also make sure your Internet Service Provider (ISP) is equipped to help you set up a “storefront” for receiving donations. Some ISPs are more familiar with the needs of charities and nonprofit groups; others are more comfortable working only with for-profit businesses dealing in tangible goods, as opposed to online donations. Conduct some research before selecting an ISP.
Online contributions have rapidly become an essential component of political fundraising. Take the 2008 presidential campaign. In November 2007, Congressman Ron Paul raised $4.2 million in one day, while Senator Barak Obama's website brought in $28 million in the month of January in 2008. Online contributions allow campaigns to secure credit card donations twenty-four hours a day at minimal expense.
Another, more affordable, means of using the web to solicit donations is simply to post information directing people to contribute by mail or pledge by phone. This eliminates having to deal with credit cards or online transactions. You can certainly offer both options, but this way saves you from having to worry about online business transactions and may also eliminate legal questions regarding donations from other states or countries. You might even provide a printable online form. Many smaller organizations use the Internet in this manner to request donations; this method works well for some, but not all, organizations.
E-fundraising is tricky. Be prepared to handle donations as they come in and thank donors immediately. Though many organizations report it still makes up only a small portion of their revenues, e-fundraising is a growing area of fundraising and will continue to develop in the coming years.
