Growth in E-Philanthorpy is Off the Chart
The nonprofit sector has come a long way in its use of the Internet. Funds raised online by nonprofits have grown from $250 million in 2000 to more than $5 billion in 2006. Growth today continues to be strong, with average online fundraising estimates exceeding 30 percent per year.
Just as online fundraising has grown, so has the adoption of online marketing technology. In 1999, less than 15 percent of nonprofits had Web sites. Few were taking gifts online, and even fewer were collecting and sending emails. While many large, sophisticated groups had built robust Web sites, they often had disparate systems that were cumbersome, expensive to maintain, and ineffective for building integrated communications.
Today, almost every nonprofit has basic online marketing capabilities such as a Web site as well as the ability to take donations and send email. More than 1,000 organizations have deployed robust eCRM (online constituent relationship management) platforms that help them attract, engage and drive ongoing support.
The nonprofit sector also has grown its capacity for conducting effective online marketing. The availability of nonprofit professionals skilled in using online tools and online marketing practices has increased. New Internet marketing agencies serving nonprofits have developed, and several direct mail agencies now provide online services. As a result, it is easier than ever to find best practices.
Integration is Key
Probably the most important best practice to recently emerge is the integration of the Internet with other communication channels — in particular with direct mail. Savvy nonprofit groups are beginning to see the importance of integrating online and offline communication and solicitation efforts. They also are recognizing that a single mode of communication should not be measured in isolation, but rather by its impact across various communication channels.
Developing Online Marketing Capacity
While progress has been strong, online marketing capacity remains a significant challenge. While nonprofit executives increasingly appreciate the strategic role the Web can play, most do not know how to organize for success. Very few have clearly stated Internet marketing plans. Many do not provide enough human resources or the appropriate in-house skills. Many groups still struggle with defining what metrics they should measure and how they should determine the level of their success.
To maximize online success, I recommend that nonprofit organizations remember the following core principals of eCRM (online constituent relationship management):
- Focus on building your email file. Aspire to collect email addresses for 50 percent or more of your active donor base while building an additional email file for prospects.
- Engage your constituents with compelling emails, Web content and other online interaction opportunities.
- Ask for support at an appropriate frequency through email appeals. Also, make sure that those appeals are clear, tangible and have a strong case for support.
- Retain and grow your constituents by providing opportunities to become sustaining donors, keeping them up to date on how their contributions are being utilized, and offering them opportunities to deepen or expand their involvement. Segment or personalize your communications to show that you recognize their specific contributions and understand what they most care about.
In addition, I recommend that organizations increase their efforts to integrate their various ways of communication with supporters. Avoid the temptation to measure your communication channels on the revenue collected by each channel. Recognize that channels work together and can be very synergistic.
Constituents Should Be Front and Center
Finally, nonprofits should become constituent-centered in their approach to online fundraising. Offer supporters the opportunity to manage their mix of contributions through:
- gift catalogs and online auctions
- directed giving opportunities and
- installment payment plans.
Encourage your most passionate constituents to help you garner support from others by providing opportunities to engage in peer-to-peer fundraising for tributes, memorials and events.
About the Author: Vinay Bhagat founded and heads strategy for Convio, Inc., a leading provider of on-demand software and services that help nonprofits use the Internet for building strong constituent relationships to drive fundraising, advocacy and other forms of enduring support.
