Online Charity Gifts Grow 16% as Web Turns Activists Into Donors Janet Novack - Forbes
go to original April 7, 2012

The viral Kony 2012 video grabbed the headlines last month. But with a lot less notice, many of the nation’s charities have been ramping up their online and social media efforts, gaining activist donors in the process.

Convio, Inc., a charitable fundraising software company with 1600 clients, including 51 of the top 100 on the Forbes Largest U.S. Charities list, plans to release a survey showing charities’ online donations (in dollars) rose a median of 15.8% in 2011, while the number of online gifts grew by 12.6%. The study is based on results from 719 charities which used Convio services for all of 2010 and 2011. Collectively, they have the emails of 210 million potential donors and probably yours.

In recent years, online giving, as tracked by Austin-based Convio, has grown at a double digit pace similar to the growth rate of e-commerce retail sales, while overall charitable giving has tracked the struggling economy. Giving USA and the Center on Philanthropy at Indiana University estimate that individual contributions to charity in the U.S. rose a modest 2.7% in 2010, after two years of decline. (The 2011 Giving USA estimate hasn’t yet been released.)

In 2010, online contributions, as tracked by Convio, grew 20%, thanks to a spurt of giving after the catastrophic January 2010 earthquake in Haiti. The March 2011 earthquake and tsunami in Japan produced a far smaller U.S. donor response and the number of first time on line donors to disaster and international relief agencies fell by a median of 25% in 2011. Growth in revenue from special team events, in which participants solicit donations from friends based on, say, how many miles they walk, also was slow in 2011—a reflection of the fact, Convio says, that it’s a more “mature” market. Excluding special events, online contributions grew 19.7% in 2011.

Vinay Bhagat, founder and chief strategy officer of Convio, said in a phone interview that one major trend emerging from the 2011 survey is charities’ increased use of online public policy “advocacy” campaigns as well their growing success at converting online advocates into donors. In a typical advocacy campaign, a charity will suggest you contact public officials and provide an easy link for emailing them. Charities reported a median 17% growth in the number of online advocates and a 25% increase in the number of those advocates who also anted up money online. Bhagat cites Planned Parenthood’s recent performance as a prime example of how effectively that crossover can work. After the Susan G. Komen Breast Cancer Foundation announced on Jan. 31 that it was cutting off breast cancer screening funding to Planned Parenthood, the later rallied online advocates and donors –forcing Komen to reverse its decision, but not before Planned Parenthood had raised more funds than it would have lost. “With the advent of social media, it’s easier for a campaign to go viral and if any issue is political, it’s like pouring gas on the fire,” he said.

That incident, as well as the viral video demanding that brutal Ugandan guerrilla leader Joseph Rao Kony be brought to justice, have demonstrated to charities that “social media, either positive or negative, can take you by storm and you’ve got to be prepared,” Bhagat said. He noted that the March spread of the Kony 2012 video produced by the Invisible Children charity was hardly an accident. According to a study on the Kony phenomenon by the Pew Research Center’s Internet & American Life Project, the social media campaign was well orchestrated, with such celebrity Twitter users such as Oprah Winfrey, Ryan Seacrest and Justin Bieber playing a crucial role.

When it comes to the use of social media, Bhagat said, animal welfare and environmental/wildlife charities have been noticably in the lead. That has translated into fast growth in their advocacy rolls, with animal welfare groups reporting a median 30% increase and environmental groups a 29% gain. Bhagat noted that the Humane Society of the United States has a six person social media team. The organization now has more than 100,000 followers on Twitter at @humanesociety and 1.3 million people have “liked” its animal and star studded Facebook page.

One area where charities significantly lag the private sector, Bhagat said, has been in creating mobile versions of their web sites. As social traffic gravitates to smart phones, such pared down, smart phone and iPad friendly sites will become crucial, he said, since a Facebook update saying someone has just made a donation or participated in a charity’s advocacy campaign is a more powerful motivator than an email from the charity. “This applies particularly to younger donors who have less trust of a marketing message coming from an entity than from an individual they know,” he added.

Going forward, Bhagat predicted, smart phone contributions done via apps will become a more important source of donations than text message donations, since wireless carriers like AT&T and Verizon Communications generally limit contributions per text to $10. By contrast, in the Convio survey, charities reported a median on-line donation size of $93.67. Text message donations also appear to be more spur of the moment and don’t translate well into continuing support for an organization, a cause, or even that method of giving. A recent Pew survey of donors who had given in 2010 to Haiti relief via text message found that only 56% had made text donations to any subsequent disasters, with 40% donating to Japan and others to Gulf oil spill and U.S. tornado relief efforts. Moreover, 58% of the text message donors said they had followed subsequent Haiti relief efforts either “not at all” or “not too closely.”

Despite the fast online growth, most charities still get less than 10% of their contributions from e-donations, Bhagat estimated. But, he added, some cause related, social media savvy non-profits are now raking in as much as 25% of their small donations on line.

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