The Giving Evolution and the Ecology of Online Giving

The Giving Evolution and the

Ecology of Online Giving

Columbia Law School Charities Technology

Conference

March 24, 2011

Debra Askanase, Community Engagement Manager,

FirstGiving

The old way = conceit of ownership

nonprofit

organization

supporter

list

Yearly

appeal

Special

appeals

Fundraisin

g events

The donor revolution is not on its way.

It has arrived.

“Donor legacy mindset”

= a thing of the past It’s about causes, not

the organization

Every. Single. Day.

Nonprofits must earn donor loyalty

Donors are in control seeking out a cause and

a nonprofit to match their passion

Non-

profit

Non-

profit

Donor Donor

Donor

Donor

Donor

Donor

Donor

Donor

To young donors,

nonprofits themselves

are fungible

Non-

profit

…and they now choose

how they donate

to which organization

and when

Technology has put donors in the driver’s seat

Access to information

The rise of influence networks

Online donation solutions where donors

live - online

The recommendation engine is driving

purchasing decisions

Influencing

purchasing

decisions

“Millennial donors say

they would be likely or

highly likely to give if

asked by:

a family member (74.6%)

or a friend (62.8 %)”

- Millenial Donor Report, 2010

Donate Button for websites

Pre-

2000

Donate using mobile

phone/SMS

2005 2009 2011

Donate via social networks

Project-based

website donations

Personal Fundraising through donation portals

Generalized online donation portals

Cross-platform

donation portability

Abbreviated

History of Online

Donations

Annual US giving: $300 billion

http://www.blackbaud.com/bb/online/fundraising.aspx

http://philanthropyblog.bwf.com/2011/03/convio-reports-on-growth-of-

online.htmlt

http://www.onlinegivingstudy.org/quarterlyindex

The rise in online giving

Online US giving: 5% to 7% of $300b

Online giving growth:

- 35% in 2010 (Blackbaud)

- 40% in 2010 (Convio)

- 24% in 2010 (Network for Good)

- - 27% in 2010 (FirstGiving peer to peer)

Culture and comfort of online purchasing is

fueling the rise in online donations

386,266

552,587

744,148

920,505

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

2007 2008 2009 2010

Number of Peer to Peer Online Donations 2007 - 2010

Number of Donations 2007 - 2010

The story of unique donors

0

100000

200000

300000

400000

500000

600000

700000

800000

900000

1000000

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 48 52 57 65 68 125

Number of times an event donor has donated

2007

2008

2009

2010

Technology solutions have stepped in to fill the void

Be where the giving happens

External to the

website

On the website

Offline

On a nonprofit website

Home-grown systems

situated on the website

Donation button

Virtual gifts

Gift e-cards

On a nonprofit website: Donation button

On a nonprofit website: donation forms

Gift e-cards on the website

External to the nonprofit website

Peer to peer crowdfunding

platforms

Widgets of all types

(located on other sites)

Facebook applications

Niche fundraising and

donation portals

Using a Facebook Application

Features:

- The application does not necessarily live on

FB

- Must log into Facebook to use the app

- Donate through third party processor

- Can easily share the donation through

Facebook. The API is dependent on FB.

- Facebook is moving into the payment

space

http://venturebeat.com/2011/03/21/facebook-payments/

Facebook Apps: Virtual Gift example

Facebook Apps: Causes

Facebook Credits

- 30% of any transaction goes to Facebook

- Most commonly used to buy games

- Has the potential to be used for donations

- Now a subsidiary of Facebook payments

subsidiary (as of March 21, 2011)

For more on Facebook Payments: http://venturebeat.com/2011/03/21/facebook-

payments/?source=facebook

Donate anywhere: Widgets

Peer to peer crowdfunding platforms

What a fundraiser will typically need to

do:

- Register on the site and create a log-

in

- Search for a 501(c)3 beneficiary on

the site (pre-vetted by either the IRS

master file and/or GuideStar)

- Select your 501(c)3 beneficiary

- Create a fundraising page

- Ask for donations from friends and

family (and even strangers) online

- View donations back-end account

management

Peer to peer crowdfunding platforms

Peer to peer crowdfunding platform: Crowdrise

Niche fundraising or donation portals

Nonprofit payment processing explained…

http://idealware.org/articles/payment_processing_pictures.php

Third Party Payment Providers

• Paypal

• Google Checkout

• Amazon Payments

NPO gets own merchant account and Gateway

Donor-centric: 501(c)3 donation provider

• Razoo

• Network for Good

• FirstGiving

• Just Give

• GlobalGiving

Three models of donation payment processing

Third Party Providers

• Pros

• Easy to setup

• No monthly fee

• Cons

• Needs an account on system

• No 501(c)3 Verification -

• Not ideal user experience

Own Merchant Account

• Pros

• Greater Control

• Cons

• $ for setup and monthly fees

501(c)3 Donation Providers

• Process $ for 50(c)3 only

• Fee structure varies between providers

• Pros

• Easy

• Verification takes place of 501(c)3

• $ to NPO quickly

• Cons

• Less flexible for the NPO

How donations get to the nonprofit

Donor-centric disbursement

Donation to charity from a web app

• Crowdrise

• Causes

• Firstgiving

• Network for good

• Razoo

501(c)3 Verified

• Guidestar

• IRS Master file

Donation Goes to Nonprofit via Provider

• Receipt is sent to Donor

• Nonprofit gets report

“Social media fundraising” usually means this

Or this…leveraging the power of social media

The bleeding edge: social media platforms for

fundraising

“Social media does

not raise money,

people raise money”

-Holly Ross,

NTEN Executive Director

http://www.nten.org/blog/2009/07/06/three-lessons-social-media-

fundraising

Mobile giving

http://www.nten.org/NTENChange

Accelerated growth in on-site giving

The (near) future of online giving

Accelerated growth in peer to peer giving

Explosion of APIs powering other sites

Growth of mobile giving options

(including donation portals)

Project-based donations, not only to nonprofits

Personalized, geo-local online giving experiences

Thank you!

Debra Askanase

Community Engagement Manager

FirstGiving

Email: debra@firstgiving.com

Twitter: @askdebra, @firstgiving

Telephone: (617) 963-5120

http://www.firstgiving.com