Where It's @

Looming over everything you do, technology is making nonprofit
fundraising more relevant and immediate than ever imagined.

July 2006 By Margaret Battistelli

multipage

Lots of folks in fundraising are excited about the bells and whistles that are available to them for enhancing their Web sites or sprucing up e-mails. And while those are important, Verclas starts her discussion on the topic of e-philanthropy by concentrating on the decidedly less sexy side of technology ­— data mining and database management. Less sexy, yes … but probably more important in the long run.

“The ‘e’ implies that there’s an online component to it, which certainly is true. But I think there’s a back-end component to it that a lot of organizations have figured out exceedingly well, and that is doing a lot of data mining on their donors,” she explains. “Of course, technology is the key for that — using databases to understand who’s giving, what, when — and that doesn’t necessitate using the Web or any kind of online technology, per se.

“For example, the YMCA is great at fundraising, but they’re not doing it online necessarily,” she says. “But they have a great idea of who gives to them, and they have used technology very effectively on the back end.”

It’s a benefit of technology that Verclas just can’t stress enough, especially considering that high-tech donor-contact devices such as e-mail and text messaging allow organizations to gather information quickly and at little cost, as well as to test ideas on a shoestring and make almost immediate changes based on the results.

Basically speaking …
No matter what kind of geek gear development pros have at their fingertips, successful fundraising always comes down to relationships. That truth is possibly best underscored by the difference in the uses of technology in annual-fund campaigning as opposed to major-gifts cultivation.

Large-volume efforts such as special events where a great number of donors are tapped to give smaller contributions — supporting someone in a walk-a-thon, for example, sending out urgent alerts and calls to action, etc. — have reached new heights with the dawn of viral marketing and interactive, user-friendly Web site innovations. But once you get beyond that into the realm of major and planned gifts, fundraisers have to pry themselves away from their keyboards and put in the same kind of intense face time with donors that they always have.

“In those instances where you’re cultivating major donors, let’s face it, the relationship building is hugely important, and that doesn’t happen online. That happens face to face. There are areas where technology aids to a great degree, and then there are those areas where communication with the donor and keeping people updated via e-mail is useful but it doesn’t generate the $3 million gifts,” Verclas says.

“Prospect research has com-pletely changed in the age of the Web,” she continues. “You have a much greater ability to do background research. So, yes, technology can help open the doors, but you still have to walk through them. And the walking through them has to happen in person.”

Ultimately, Verclas says, it’s all about common sense — and recognizing that there really is no panacea in fundraising. The best development professionals can hope for is the smarts to stay on top of what technology has to offer, take the best of what works for them and leave the rest.

Verclas concludes: “It’s a big, complex set of questions, for sure, which is why every person working for a nonprofit should be having a lot of fun right now.”

Next Big Things
So you’ve got a “Donate Now” button on your Web site, and you’re feeling pretty darn good about yourself. Well, unpuff that chest and take a look at the things that are just waiting for you to catch on to them.

Here, Katrin Verclas, executive director of the Nonprofit Technology Enterprise Network (www.nten.org), talks about the hottest things on the horizon as far as fundraising technology is concerned.

No. 1: Social networks
“There’s a fundamental shift that’s happening in society in general, and organizations need to pay attention to it. It’s been facilitated by technology but, ultimately, it’s a very deep human desire — and that is to build communities. The notion that organizations should speak one on one is probably a mistaken notion,” Verclas says, adding that the most successful fundraising campaigns underscore the individual donor’s place as
part of “something greater.”

“You see it everywhere, in social networking sites (such as MySpace), in donor circles, in fundraising techniques that say, ‘You and 500,000 other people gave $3, and therefore we now have $1.5 million and we can do something with that. The notion that you can aggregate voices, people, dollars, whatever it is, in a way that wasn’t possible before really speaks to a very deep human need to feel like you belong to the greater human community.

“Technology plays a critical role in that, and fundraisers need to recognize that and possibly not go just one on one,” she adds. “That’s where I see potential for some really innovative thinking.”

Giving circles where the “ladies who lunch” meet to eat and decide where to donate their pooled resources are one thing. But just how effective are virtual communities? Do they too fill the basic human need that Verclas talks about? Apparently so. She quotes research that, she says, “has put a definitive end to the notion that somehow online communities are poor or that somehow technology is depriving us.”

“Technology has actually enabled us to be in touch with more people; our social networks have actually increased, and that’s true organizationally too,” she maintains. “We have the ability to reach a much greater set of people and have relationships with a much greater set of people. And, no, they’re not as meaningful. But I don’t have a really deep, meaningful relationship with the person that makes my coffee in the morning, and that’s fine — but I’m still very friendly with him.”

No. 2: Cell-phone fundraising
Thanks to greedy carriers and a less-than-efficient infrastructure, giving via mobile phone isn’t something that’s caught on yet in the United States — though our charitable counterparts around the world already have seen the light. According to Verclas, a smallish number of U.S. nonprofits are promoting activism and advocacy through text messaging, but only a handful are using it to raise money.

“The [cell phone service providers] are still taking such a large percentage of any contribution, so you can’t really tell your donor, ‘Well, you know, only 50 percent of what you’re giving is actually getting to where it’s supposed to go,’” she says.

One fledgling program is a collaboration between PayPal Mobile and Amnesty International that allows donors to contribute to the organization via text messaging and have the payments taken directly out of their PayPal or bank accounts and is, according to Verclas, “quite fun.”

There’s no system in place yet to attach donations to a monthly phone bill, and the program allows only “micro payments,” with a cap on how much a donor can give. Because of that, it’s not really worth it yet from a fundraising point of view, Verclas says.

“But it is worth keeping an eye on developments there, and being able to jump on that is important,” she adds. “If you can establish a different channel to contact a constituent, then it’s bound to be worth something in the end — and this is a highly, highly personal media that is in a person’s pocket 24/7.”

Verclas says that preliminary data is showing that, at upwards of 70 percent, open rates on text messages are “huge, huge, huge” and simply dwarf those of e-mail.

“That window is going to close, of course, once people start getting spam on their mobile phones,” she warns, but she says progress toward more practical cell-phone-donation programs is moving along at a “pretty rapid clip.”

“I think we’ll see a lot more of it in the next six months,” she adds. — MB

Fundraising Once Removed
As development professionals slowly finesse their understanding of the Internet as a fundraising device, it’s becoming clearer that its immediacy is as useful for urgent alerts and calls to action as for soliciting donations — if not more so. And in the end, those inexpensive and fast-paced relationship builders can lead to an increase in donations, even without a barrage of specific asks.

At least that’s how it worked for the internationally active Anti-Defamation League, which recently turned to e-philanthropy techniques to increase its e-mail address list from about 4,500 names — not all of which were even viable — to more than 200,000. The numbers equated to a 260 percent increase in online donations in 2005; 61 percent of those donations came from people who provided ADL with their e-mail addresses via its Web site or through “forward to a friend” interactions.

“One of the most exciting things is how much of that has really come from organic growth. What I’ve been very pleased about is how important the issues that we address in e-philanthropy have been to our donors, how seriously they take them and as a result how they pass those on to their friends and their contacts,” says Graham Cannon, director
of marketing and communications for ADL.

“That’s been a very critical part of our growth. One of the most interesting things is that those organically acquired individuals tend to have a much higher percentage of involvement in whatever it is we’re asking people to do, including fundraising.”

ADL launched an offensive in mid 2004 to collect e-mail addresses and start applying technology to the all-important task of relationship building and to somehow transmute the highly personalized approach usually only seen in major- and planned-giving efforts to cultivating highly involved advocates and, ultimately, donors. The goal was to start drawing its many small-dollar donors more actively — and interactively — into the organization’s work.

“That in many ways was more important as a motivator than the fundraising aspect,” Cannon says.

ADL focused its e-mail cultivation efforts around its highly successful Web site, which gets about a million hits a month. It added some conversion structures to the site to invite people to provide e-mail addresses and specify their areas of interest in return for electronic newsletters and other updates and calls to action.

For example, it launched a campaign around “a set of viciously anti-Israel resolutions” that were on the floor of the United Nations General Assembly at the end of 2004 that produced thousands of signatures (and their related e-mail addresses) in a short period of time.

“We delivered that petition to the U.N. and made sure we reported back to those who had signed, as well as those who hadn’t signed, what had happened and the importance of their involvement,” Cannon says. “I think all of us were sort of surprised and delighted at the response we got even as we initially moved this out.”

Buoyed by its initial success, ADL then in 2005 started projecting how its new approach to relationship building could work over months, quarters, even years. Part of the strategic plan that was built around the intensified efforts was an editorial calendar that planned and then tracked e-mail broadcasts so that ADL could monitor which actions and appeals were attracting supporters, which moved them to activism and which ones ultimately lead to donations.

Through testing, ADL has found that depending too much on straight-forward asks doesn’t produce dollars from its supporters, so it had to look away from the traditional direct-mail mindset that dictates that the majority of an organization’s correspondence with supporters contain an ask.

“We tested some end-of-the-year fundraising e-mails [and] it became very apparent to us that simply asking for money, by itself, is not an especially productive technique,” Cannon explains. “To the real credit of our supporters, they demonstrated to us that they wanted us to demonstrate to them what we were doing, how we were doing it, what impact their support has.

“Our supporters are interested in knowing that their involvement has impact, supporting us on specific issues,” he adds. “It’s not about sending an e-mail saying, ‘Please donate to the ADL.’ That’s a pretty ineffective way of doing it. It’s about being able to say, ‘Because of your support we’ve been able to do A, B, C, D and E. And now we need to do F, and here’s how we intend to do F, and your support will make that possible.’ That’s a much more effective way of reaching people.”

Six months into the new year, ADL has seen an increase in donations, and is “delighted” with the new level of engagement it’s seen over the past few months. Looking ahead, it’s looking into new applications of online technologies to further engage its supporters, including streaming audio and video, and podcasting — “anything that can bring our supporters into the world we live in every day,” Cannon says.

“It’s really about relationships, it’s really about giving [people] who are interested in our issues the ability to engage as much as possible and as closely as possible with the work that we do,” he adds. “These are the things that in many ways are the most important pieces of e-philanthropy technology.

“That’s the remarkable piece of this, this ability to empower tens of thousands of people so they feel their voices are being heard,” he concludes. — MB

Points to Ponder
Graham Cannon, director of marketing and communications for the Anti-Defamation League, offers the following tips for using the Internet to bolster your organization’s fundraising efforts:

1. Do your homework — first
“We put together what was an RFP initially and then became a business plan. We really wanted to make sure that we had a very clear understanding of what the out-front investment looked like, what the continuing investment looked like, what the revenue looked like, and what the staffing looked like,” Cannon says.

“One of the things that I think we realized early on is that the technology, while it’s excellent and exciting, is no different than any other technology purchase. It’s really about how you use it and how you staff this and
how you manage this through the organization. I mean, the biggest concern that we had was making sure we didn’t invest in a technology solution without figuring out how we were going to implement that technology solution.”

2. Get it right
“Make sure that on the Web site there are many opportunities to donate, because it seems apparent to us that as people become more engaged in the organization, the point at which they decide to become a donor may not be something that we can or should control. We should make sure that the opportunity is there when they make that decision. And when someone makes that decision, you need a back end that’s going to ensure that that decision isn’t going to get unmade because a piece of the technology failed or the form is too difficult to navigate,” he says.

3. Use it the way it was meant to be used
“Because of the cost, there’s almost no mailing in direct mail that isn’t a direct ask. There’s no strategy that I know of that doesn’t require a direct ask in every piece of mail that goes out. Likewise with telemarketing,” he says.

“The thing that’s different about [e-philanthropy] is that instead of every piece of mail that goes out containing an ask, you can make it maybe one in four pieces. That’s a new thing; we’re still playing with it because there’s a relationship aspect of this that’s brand new. It doesn’t exist in other forms of direct marketing. The trick to using this medium is its two-way connectivity, the fact that once you begin a dialog with someone, they respond back to you.”

One E-mail, One (Big) Gift
A few months ago, when I was thinking about major-donor possibilities, there was one foundation I thought it best to contact with an e-mail rather than a regular letter, telephone call or visit because in the past year, that’s the way we had been communicating. I condensed a five-page proposal into three short paragraphs, requested $20,000 (double what we had been given in the past) and offered to send more detailed information if needed. I hit “send” and waited.

The next day, I had mail: yes to the grant and yes to the higher gift. No to the offer of more information. The only thing left to do was send the compliance letter.

Tips to raising money via e-mail:

• Always get permission first. Ask the donor if this is her preferred method of communication.

• Keep e-mails short and to the point, but tell the donor that more detailed information is available.

• Start a fresh e-mail every time to avoid passing along others’ e-mail addresses and personal information.

• Make sure e-mails are identified as coming from your organization to avoid the spam trap.

• Don’t be afraid to ask for a major gift or pledge in an e-mail.

• Say thank you right away, and have your president or CEO say thank you via e-mail as well.

• Build relationships with your donors the way they communicate best and you could be in for a major (gift) surprise.

— Margaret Guellich, senior director of development, American Life League

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