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Traditional methods of raising funds for nonprofit organizations include foundation grants, corporate and other gifts, memberships, donations, events and direct mailings. These methods can all prove difficult during depressed economic times. Indirect costs for events, advertising collateral for communications and traditional mailing have all increased, while discretionary funds for giving have decreased.
Many nonprofits have turned to the internet since 2000 for answers to their fundraising dilemmas. While the use of the internet as a fundraising tool is still in the emergent stage, it shows great promise in cutting indirect costs for organizations, while potentially reaching much larger constituencies. The tools available for community building on the internet include organization websites, email campaigns, public social networking sites such as Facebook.com, private in-house social networking sites and crowd funding websites like Crowdrise.com.
James Austin of the Initiative on Social Enterprise at the Harvard Business School notes:
“Make no mistake: the e-philanthropy revolution is here to stay, and it will transform charitable
giving in as profound a way as technology is changing the commercial world.”
During the 1990s, many nonprofit agencies reported steady or declining revenues, increased competition with other agencies, and rising demand for services from clients who cannot pay. The strategies used at that time to adapt to these changes ranged from small-scale productivity enhancements to responses involving a complete restructuring of the agency as well as cutbacks in client services.
The internet has exploded since 2000, with many millions of new users daily. It seems the obvious choice for exposure for a nonprofit, as many baby boomers have adopted social networking and can be reached in droves on sites like Facebook and Twitter. Many in this generation are also, conveniently, socially conscious individuals with stable pocketbooks, seemingly a match made in heaven for nonprofits seeking funds.
The advantage of email over other communication methods is based on dialogue. An organization can get a better understanding of the type of information a user would most prefer, due to the survey of interests that can occur. Thirdly, regular communication is crucial and can be used by nonprofits as well as corporations, and can include some “rich media” (photos, video, html pages) in emails.
This media should be able to be tracked as well, meaning it should be calls to action for users to click through to content on a website or social media site. By tracking, an organization can fine tune its missives to donors even more. Be aware that honing in on a donor’s tastes will ultimately involve more communication, as he or she becomes more involved. The results will pay for the increased workload, however, since email responses can increase up to 300%.
All email messages should have a way to donate included in the body, including a link to click and be routed to a secure online donation system. Finally, the key to building donor relationships is the way in which the organization acknowledges its gifts. Typical rules for success include:
- Respond quickly and in the same medium the donor used.
- Explain how the gift will be used.
- Recognize the gift appropriately according to size.
- Sign the email by the appropriate organization member (Olsen: 368).
Once new donors are acquired, it is crucial to stay connected to them to maintain relationships. Strategies to achieve this goal include acknowledgement of birthdays, achievements, special events, but also should include a secondary “thank you” message months later to update donors on how their funds are being used.
Email should be considered a long-term strategy. Organizations should not assume that there will be immediate returns from the new relationships that are made. The focus is on relationship building and honing those relationships so that there is two way communication. All organizations need to develop a long term strategy, setting goals for donor acquisition and setting out to achieve those goals step by step. Yes, it is much easier to pay a fee, have an organizational website launched and hope donors gravitate to it over time. However, most websites do not build relationships the way email does, even with advanced Web 2.0 specifications.
By far the most successful method of maintaining relationships on the internet is email, being more effective in communicating than a website, and offering an intimacy that social media cannot. By 2000, 93% of the 106M Americans who spent time online were using email. The benefits of developing and maintain email relationships include its speed and scalability. The utility of email has been proven by large corporations who use it daily to keep relationships active with customers. Nonprofits actually have an edge over corporations in the email environment, due to the causal element of the work that these organizations provide – users are more likely to trust a nonprofit than a corporation.
The best methodology for using email for donor cultivation and fundraising always includes the first step of acquiring new recipients, and this can be performed in a number of ways, including the aforementioned platforms. There are many stable email and newsletter online platforms available including AWeber.com, ConstantContact.com and MailChimp.com, and they all offer similar stability and features to achieve successful email campaigns. They all typically include a mechanism to install a few lines of coding to display a signup form to entice users to join a mailing list, installations can occur on websites, public social networking sites and private social media sites – any location where the organization’s web developer has access and rights to change page coding. A popular recent method of encouraging users to take the action to sign up for a newsletter is to offer a “freebie,” that is a product for free that can be downloaded after submitting email information to receive the gift. Gifts can include free e-books, articles, advice, tips, videos and webinars as well as free trial periods. This method is usually undertaken by online retail outlets, but can be adapted to nonprofit needs with a little creativity.
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