2. Think Outside the Envelope

Whether your fundraising goal is $500 or $50,000, your coffers will fill faster if supporters can donate online or by mobile phone.

Many organizations and individuals use their online presence merely to provide information about themselves, like an electronic brochure. But those that take the next step—actively using the Web to fundraise—are tapping into the fastest-growing platform for bringing in money.

Getting started is easier than you might think, even for shoestring operations and people who aren’t tech-savvy.

Let’s look at some of the reasons donors, individuals, and nonprofits are embracing online and mobile fundraising.

Clicking on the Rise

Schools, churches, arts groups, health organizations—they all rely on donations to help fund their missions. Neighbors rally to raise money for fire victims or to restore local landmarks, and we all know someone who’s helped an ailing friend or relative by taking up a collection.

About 90 percent of donations are still made face-to-face or through the old-school check in the mail. But overall, direct mail is becoming less popular as a fundraising method, and online giving is increasing. In the years ahead, online donations will continue to gain share from direct mail, and will grow even further as the 33 percent of nonprofits that don’t yet fundraise online take that step.

It’s really no wonder that donors increasingly prefer the keyboard or the mobile phone to the check and the envelope. Convio, an Austin, Texas–based company that makes software for nonprofits, conducted a survey in 2008 of 3,400 “wired wealthy” donors—those who reported giving almost $11,000 a year on average.

Although 80 percent were “multichannel” donors, meaning they gave both online and by mail, 51 percent said they preferred online giving. About 30 percent preferred giving by mail.

The following statements about the benefits of online giving received the greatest support (strongly agree or somewhat agree) among survey participants:

• Online giving is more efficient and helps charities reduce their administrative expenses (72 percent).

• Online giving lets you make a gift immediately when you’re thinking about it, where otherwise you might forget (70 percent).

• Online giving lets charities respond more quickly in the event of a crisis or emergency (68 percent).

Garnering less support but still worth noting were two other considerations:

• Using credit cards to donate online gives frequent flyer miles or other rewards (53 percent).

• Online giving makes it easier to track donations over time (48 percent).

Causes We Care About

The most common fundraising scenario involves individuals giving their time, effort, and dollars to causes that affect their daily lives. If you’ve ever collected money for your children’s soccer team or for computers for their school, you know what it’s like to make a difference.

You also have plenty of company: PayPal research shows that 15 percent of adults in the United States fundraise at least once a year, raising an average of $400 each time they take up a cause.

Individual Fundraising

The top reasons individuals fundraise (Figure 2.1) include the following:

1. Education: No surprise here. Think of how many parents tirelessly raise money for schools (gift wrap, anyone?) to help with supplies, band instruments, field trips, infrastructure, or any number of other needs.

2. Health/illness: When a friend or relative falls ill, no gift is more practical than some extra money to cover medical bills or household expenses.

3. Basic needs: People like to make their community a better place, and many make their contribution by helping to provide food and shelter for the needy.

Figure 2.1. Individual fundraising is heavily weighted toward education and health-related causes.

Source: PayPal, Ipsos Omnibus Online

Interestingly, the type of institution for which individuals most often fundraise is schools, but the top institutions to which people give money are religious organizations. The likely explanation is that most people don’t fundraise on behalf of their church, they just donate to it directly.

From a process standpoint, individual fundraising is completely straightforward: you do all the work! You ask for and collect the money, and then manage its distribution by buying the needed items or giving the cash to the coach or school or other recipients.

Fundraising for Nonprofits

Another type of fundraising occurs when individuals raise money on behalf of a nonprofit—think of the familiar Team in Training walks for the Leukemia & Lymphoma Society or the Relay for Life for the American Cancer Society. In this scenario, participants solicit donations from their friends and coworkers and turn the money over to the sponsoring charity.

Whether people are raising money on their own or for an organization, there’s a whole lot of asking going on. Imagine how many calls, letters, and emails have been exchanged to bring the Relay for Life’s total income to more than $4 billion since its inception in 1985.

The numbers prove that people are willing to ask for donations for causes they believe in, but that doesn’t mean they’re entirely comfortable doing so, or that they wouldn’t appreciate tools to make it easier.

All but the most natural salespeople have probably run up against some of fundraising’s common barriers:

1. Getting started: How do you set a goal? Whom do you contact? (And, perhaps, why did you get yourself into this?)

2. Fear of soliciting: It’s awkward to ask for money. No one wants to imagine he’s the guy with the donation cup in front of the neighborhood grocery store, watching his friends flee across the parking lot.

3. Money handling: The more you raise, the more work you make for yourself. It’s no fun dealing with cash and all those checks (fingers crossed that they clear) and all those trips to the bank.

4. Managing contacts: Keeping track of donors, updating them on your progress, and sending thank-you notes can seem like daunting obligations.

Online donation tools can relieve some of that pain as surely as ibuprofen after a three-day charity walk. At the most basic level, you can request money by sending your contacts an email or a text with a link to a donation page, or by cutting and pasting a Donate button into a website or blog. And there are plenty of resources to help with planning and goal setting. We’ll talk about these later in this book.

Nearly every nonprofit these days has at least a website and a Facebook page. Given their broad reach, turning these into fundraising channels is job one for many organizations.

According to Toronto-based Artez Interactive, a provider of online fund-raising tools, online donors tend to be younger and more affluent than offline donors, and they give more. The average online donation has consistently increased, doubling over the past four years.

Furthermore, online giving is particularly cost-effective for charities. While it can cost $1 to $1.25 to acquire a new donor through direct mail and more than 63 cents through telemarketing, the cost per dollar of raising money online can be as little as 5 cents.

Sources: Fund-Raising Cost Effectiveness, by James Greenfield; Cost-Effectiveness of Nonprofit Telemarketing Campaigns, by Keating, Parsons and Roberts; and Network for Good.

A Toolkit for Giving and Receiving

The trend toward online and mobile fundraising is undeniable. When you’re asking for money, you surely want to make it as easy as possible for people to say yes. And let’s face it, sometimes even the hassle of finding the checkbook and a stamp can spell the death of a donation.

But for individual fundraisers and small nonprofits, going digital can feel intimidating, too. Sure, you want donating to be effortless for givers, but what about the effort on your part? Nonprofits are well known for running lean operations and relying on volunteers. They may not have a lot of time or skill for setting up and maintaining a regular website, much less one that involves financial transactions.

Luckily, the effort isn’t exhaustive. PayPal and other companies provide a range of tools that can have you collecting donations as quickly as you can cut and paste. We’ll suggest a few PayPal solutions here, and you can find more details throughout this book.

Just remember, new technology becomes available all the time, and the players sometimes come and go, so it’s always worthwhile to do some research on the most current offerings.

If you or your group has a PayPal Premier or Business account, you’re ready to get started. If not, you can go to www.paypal.com to sign up.

The PayPal Donate Button

Probably the easiest and fastest way to accept donations through PayPal on a website is to add a Donate button. You don’t have to worry about code: PayPal provides the HTML, which you can copy and paste to create a button (Figure 2.2) or a link to put in an email.

Figure 2.2. Donors click the Donate button or link and choose whether to pay by credit card, debit card, or PayPal account.

Donors click the button or link and donate with a credit card, debit card, or PayPal account. All donations go directly into your group’s PayPal account for easy tracking.

There are no setup or monthly fees, just transaction fees based on how much you receive and whether you’re a registered nonprofit.

The PayPal Request Money Tool

Use the PayPal Request Money tool to solicit donations from your friends and family by email, mobile phone, or the Web (Figure 2.3).

Figure 2.3. The Request Money tool sends potential donors an email. They can use their PayPal balance, bank transfer, or credit card to donate.

You fill out the request information, then an email alerts your potential donors to log in and make a payment using their PayPal balance, bank transfer, or credit card. To give, donors transfer funds from their PayPal account into yours. If they don’t have a PayPal account, they can sign up when they receive your alert.

The PayPal Giving Widget

You can also make donating to your cause easier by placing a custom PayPal Giving Widget on your website or blog. You can:

• Post your widget to your website or blog in just a few clicks.

• Acknowledge top contributors to your cause.

• Process contributions simply.

Go to http://giving.paypallabs.com to get started.

Facebook App by FundRazr

PayPal and FundRazr have worked together on a crowdfunding app to raise money and awareness for your causes, and convert your donors into advocates.

You can share your FundRazr campaign through Facebook, Twitter, email, your blog, and your website. Causes you can fund include:

• Personal causes: Medical, travel, or education costs, personal losses, family tragedies, support for a friend, memorials, pet healthcare

• Group causes: Sports teams, school groups, community groups, churches, arts groups, animal shelters, school reunions

• Political campaigns: Campaigns at the local, state, or federal level

• Nonprofits and charities: Registered charities at the local, state, federal, or international level

Go to http://fundrazr.com/paypal-social for more information.

Other PayPal Partner Tools

• Convio, a Blackbaud company, is the leading provider of on-demand constituent engagement solutions for nonprofits.

• DonateNow from Network for Good offers branded donation pages, reports, and other services for online fundraising.

• StayClassy is a leading provider of fundraising management software for nonprofit organizations.

• Artez Interactive provides friendship-powered mobile, social, and online fundraising solutions.

• Give.mobi provides a cost-effective way for nonprofits to accept donations from smartphone users.

• Pay It Square collects money from people online for events, fundraisers, or other types of group payments.

• GoFundMe offers easy online fundraising with simple personal donation websites.

Helping Hand

Are you ready to branch out with your fundraising efforts? Good! Here are some key points to keep in mind:

• Online is the fastest-growing fundraising channel for nonprofits.

• Individuals, fledgling organizations, and established enterprises alike can raise money online.

• If you can email, you can fundraise. You don’t need technical skills to get started.

Next, in Chapter 3, we’ll discuss donor behavior and how it can inform your fundraising tactics.