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How and Why Donors Give Online

Data Show the Ball Is in Nonprofits' Court

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How and Why Donors Give Online

Photo by Frank Renlie/Getty Images

Of people who gave to charity in 2007, one in 10 did so online. That is one of the findings of the American Express Charitable Gift Survey of 2007.

This is a start, but analysts say it could be a much bigger percentage. The lack of online giving is due to the simple fact that Americans do not know about online giving options. According to the American Express study, 28% of people who gave offline said they couldn't locate a donation website, didn't know that they could make a gift online, or didn't think of it.

The study found that three factors motivate donors to give online: convenience, speed, and the ability to react quickly to some urgent need.

For nonprofits, the message is clear: advertise your ability to take online donations. Make your donate button on your website big and obvious, include your website address in every communication with donors, and include it in every press release you send.

There are some drawbacks to online giving for nonprofits. The donations tend to be smaller...typically even less than the average donation of $100 or less by the average donor (offline and online). On the other hand, online donors tend to be younger, thereby opening up the door to a new set of contributors.

It is rare, experts say, to receive major donations via the Internet. That is because major donors usually have a personal connection to the nonprofit, prefer to meet with representatives of the charity before donating, and want to make sure that they receive the proper paperwork for their tax deductions.

For now, the percentage of online donations for nonprofits is small. A 2008 survey for Giving USA found that more than 80% of charities that use the Internet for fundraising received 5% or less of their donor support from online donations.

It is also clear that number will only increase. And it will do so when nonprofits make it possible. The 2008 Philanthropic Giving Index found that two-thirds of nonprofits surveyed included the ability to donate in e-mails sent to supporters. Some 70% have a donation button or link on their websites. But just slightly more than 60% offer the ability to donate online through credit card or e-funds transfer.

Nonprofits must, researchers conclude, get online, stay there, and offer as many donation options as possible. Donors want control of how, when, to whom, and how much they donate.

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