"Can I donate online?" "Does your organization have an online giving program?" Crisis relief organizations are hearing these questions regularly as the world responds to December's tsunami disaster. Once described as a "nice-to-have" feature, online donation processing is increasingly a "must-have" for most organizations, regardless of their missions. In The Value of Online Donations, we explore the true value of a dollar raised online vs. offline. And if you already have the ability to donate online, learn how to take your organization to the next level in Recurring Gifts — Are You Taking Advantage? You are receiving this email because you are subscribed to Fundraising Well, a free monthly newsletter about nonprofit fundraising and management best practices. If you do not wish to receive future issues of Fundraising Well, please click here. Suggestions or comments? Want to contribute an article to Fundraising Well? Send your
feedback to fundraisingwell@blackbaud.com
|
||||||
Find this newsletter useful? Forward it to a colleague!
Editor's Note|
As we begin 2005, it is natural to reflect and look at the year that has passed to gather information that can help us overcome the inevitable fundraising challenges the New Year will bring. I have attended numerous trade shows, seminars and presentations this year and have listened to many questions regarding online donations, one of which being: "Do online donations have a 'higher dollar value' than traditional gifts?" This is one question that I decided to investigate. As a credit card processor for nonprofit organizations throughout the U.S., Canada, Europe, and Asia Pacific, we are privileged to process transactions for thousands of nonprofits. We are also in a somewhat unique position, as we see and process donations of many types: online donations, recurring monthly gifts, one-time gifts, and events. This gives us the ability to track where donations are coming from and how much these gifts are for, valuable information when analyzing the success of a fundraising campaign. So we ran some numbers on 1000 nonprofits in the U.S. and Canada and analyzed the transactions processed in 2004 through the IATS system. We defined an offline transaction as one that was processed through one-time gifts, recurring gifts, etc., while online transactions included those coming from a “donate now” function, online events, and registrations. We found that in the U.S., a typical offline transaction averaged at US$89.25, while an online transaction averaged US$116.65. In Canada, the difference was less dramatic, with offline transactions averaging CDN$58.56, and online transactions averaging CDN$64.34 (although the Canadian donation portal Charity.ca had an average gift size of CDN$114!). The reason for the smaller offline gift sizes in Canada may be attributed to the success of recurring gift programs (where a donor commits to an open-ended pledge to be deducted regularly from his bank or credit card). These gifts tend to be smaller — the average size of a recurring gift in Canada is CDN$24, and in the UK, 12 pounds — but the transaction volumes are significantly higher. Further analysis of clients processing online and offline transactions through the IATS system showed that in almost every case, the average gift size for an online donation was higher than an offline one. In one specific case, a ministry had an average offline gift size of US$56.67, while its online donations averaged US$354.97! So what does this tell us? About the author: Andrew Mosawi is the director of nonprofit services at IATS, a Ticketmaster Company that provides credit card processing services to nonprofit organizations in the United States, Canada, Europe, and Asia Pacific. He has worked with and for nonprofits in the United Kingdom, Canada, and the U.S., and is a member of the Board of Trustees of the ePhilanthropy Foundation.
Recurring gifts — sometimes called regular gifts — have long been a staple of charities in the United Kingdom. But with the exception of a few types of U.S. nonprofits, such as public radio stations, this easy, efficient way of collecting donations has yet to catch on in North America. Recurring gifts allow nonprofit organizations to debit a donor's bank account or process a charge on a donor's credit card each month for a pre-determined amount. These gifts differ from pledges because they are more than a promise to pay — the gift has technically been paid and is merely being collected over time. Your organization can save time and money with recurring gifts. As you know, pledges often require a great deal of work to collect. Each time a payment is due, a reminder must be sent. Sometimes, the donor procrastinates on writing and mailing the check. In these cases, your organization may be cast in the awkward role of collection agency, which can breed negative feelings in the people you are counting on to support and advocate your mission. Obviously, an automated alternative could benefit your organization. But surprisingly few nonprofits realize that donors consider recurring gifts a beneficial service to themselves as well! Is this truly a powerful fundraising method? In fact, a growing number of potential donors appreciate the convenience of allowing nonprofits direct access to their bank and credit accounts. This is thanks to the availability of online banking and bill payment services, which have helped donors become comfortable with automatic account debits. Skeptics need only take note of the decline of cash and checks in circulation. Physical money has declined by 3% in the last three years — a number that translates into billions of dollars. "Real" money has been replaced by electronic transactions, and the percent is only expected to increase in coming years. Recurring gifts also feel more economical for donors. When you draft $20 each month from a donor's account, rather than collecting $100 up front, your donor experiences less of a financial burden from the gift — while still receiving the recognition and benefits of giving at a higher level. Definitely a win-win situation! The benefits of building a relationship As you establish your recurring gift program, don't forget that just as with standard gifts, recurring gifts must be recognized in a timely fashion. Some experts suggest sending a brief note or email of acknowledgement at least every other month during the first year. This shows the donor how much you appreciate the gift — and sets the stage for you to ask for a $5 increased amount the next year...and the next...and the next! Recurring giving resources:
 Other online and recurring giving resources:
Want to strengthen your relationship with donors and volunteers? Give them "Living a Life of Significance," 101 inspirational quotations celebrating life, philanthropy, and volunteerism. Great for the holidays! Visit www.designsforgiving.com. You received this email because you are subscribed to Fundraising Well. If you would like to unsubscribe, please click here and you will be removed immediately. If this email was forwarded to you, and you would like to receive a free subscription, please visit http://www.blackbaud.com/support/register.asp and log on to our Web site. Once logged on, click the Manage Subscriptions button to choose which Blackbaud publications you'd like to receive. The information contained herein should not be construed as legal or professional advice. If you have questions about how this newsletter's content applies to your organization, you should seek advice from appropriate professional counsel. © 2005 Blackbaud, Inc. All rights reserved.
Nonprofit
Management and Fundraising Software Blackbaud, Inc. | 2000 Daniel Island Drive | Charleston, SC 29492 | 800.443.9441 |
Recurring Giving — Are you taking advantage of this successful fundraising method? 