The Advantages of New Technology
New Media Fundraising
New interactive technologies are swiftly becoming a key element in the fundraising mix. Innovations generated during the last decade include Internet applications, mobile technologies and interactive television. Charities are now gearing up to use some of them in their fundraising programs. This article provides a summary of the most important new technologies, their features, and their advantages for fundraising.
It’s now been little more than ten years since the Internet, and especially the worldwide web, really became part of our daily lives. Ever since, more and more non-profit organizations have started using this medium; clearly, the Internet is changing philanthropy. By using the Internet, charities can reach a large number of people at relatively low costs and they’re finding more convenient ways to carry out fundraising by means of computers. Two specific features of the Internet – websites and e-mail – have contributed to online fundraising. But these are not the only two ways that charitable causes can apply the Internet.
If an organization has its own website, (potential) donors can obtain information about the organization and submit their questions to it. But the key factor to any successful website, besides being up to date, is being interactive. Interaction between the nonprofit organization and (potential) donors is essential for attracting traffic to the site and for bonding with donors. Interaction is encouraged by activities such as:
Online giving is quickly becoming an essential component in every NPO website. Many charities are now generating funds through their websites by having a “donate” button on their own website. Making a donation online is fairly simple. Either you have the equipment and software to receive secured donations made by use of a credit or debit card, or you should be able to use the facilities of another agency to collect these funds. The goal is to make the transaction as easy as possible for both you and your donors.
One thing to remember, however, is the importance of protecting the public’s confidence and trust in the reliability and security of these online transactions.
More and more charities are adding an online shop to their website. Selling products with the organization’s design and logo can generate extra income and promote the charity’s interests in yet another way.
With a relatively minor investment, a webshop could thus be a potential source of funds year round. On the other hand, enticing people to visit your site and come back to shop there can be a challenge. Nevertheless, if your employees, volunteers and donors are passionate about your cause, they’ll make the extra effort to keep dropping in – especially when reminded either online or offline every now and then.
The term “blog” is a contraction of “web log”. A blog is a website where entries are made in the style of a journal and are displayed in reverse chronological order. Blogs often provide commentary on or news about a particular subject. These could include philanthropic projects or special events; other blogs function as more personal online diaries. A typical blog combines text, images, and links to other webpages and other media related to its own topic. It takes time for a blog to become widely known and it takes time to manage the content. When managed well, however, it will definitely generate traffic to your website.
It’s also very easy to make a blog interactive by giving visitors an opportunity to respond to the posted entries.
In the new media environment, e-mail is an important element. Overall, 95 percent of Internet users make use of the Internet for the purpose of sending e-mails. Many nonprofit organizations are moving toward actively using e-mail campaigns as part of their fundraising programs.
Besides its low cost, e-mail is also an efficient and effective way of communicating with donors. There are three reasons for this:
- E-mail is interactive. This helps get donors involved in the charity.
- E-mail is immediate. A message drafted and sent at 9:00 am arrives in your donor’s e-mail inbox within a few minutes. This makes e-mail a fast way to give your donors urgent information and to solicit for immediate donations.
- Lastly, e-mail lets you build relationships with donors, increase traffic to your website and invite them to donate.
But there are also some disadvantages. The main challenges facing e-mail fundraising involve spam filters and crowded inboxes. Compared to direct mail, third parties such as providers, software suppliers and system administrators have an impact on the reach of the e-mail messages.
E-mail is mainly used for sending letters but other e-mail concepts include newsletters, e-leaflets, inquiries, campaign mail, service mails and e-invoices.
E-mail is frequently being used for sending newsletters. An e-mail newsletter could be integrated into your donor database in order to personalize/customize your newsletters according to the interests and preferences of each of your donors.
Viral marketing & games
Viral marketing is a specialized way of using e-mail. “Viral marketing” is the term used to describe the word-of-mouth effect of web users e-mailing an idea or statement to their friends. The main objective of viral marketing is to gather lots of e-mail addresses. Viral marketing should not be used independently but should be aligned with other media for the purpose of generating a successful campaign.
Search engine marketing
Search engine marketing is an online fundraising strategy defined as buying keywords on search engines like Google and Yahoo!. Its main advantages involve attracting traffic to your site, selling your merchandise and adding donors to your e-mail lists. Many nonprofits are now buying keywords to attract new and existing donors and to raise money.
Besides having your own website, you could also add yourself to others. This can be done by banner advertisements and by posting at charity portals or charity malls.
Banner ads or linking
Banner ads and linking are forms of online advertising. They involve putting your advertisement on another website in order to generate traffic to your own site. Many companies now offer nonprofit organizations links on their company websites. They sometimes even allow the display of a graphic that can be clicked on to get to the charity’s home page.
Another Internet strategy is to get your nonprofit listed (often for free) on all the charity portals the web has to offer these days. Charity portals are websites that offer a directory of nonprofit organizations. Their job is to attract lots of traffic to their site and encourage visitors to make contributions to the nonprofits listed. Since individuals interested in donating to charities often use charity portals to help them with their research, it could be valuable to be listed.
Social networks, communities, discussion groups and chat rooms
By participating in one of these online groups, you can promote your organization while providing (potential) donors with valuable information. Choose communities or chat rooms that your target audience is likely to visit repeatedly. These groups make it easy to bring up or respond to a topic for discussion.
A charity mall is an online fundraising service that passes on a commission to your organization (anywhere from 1 to 50%) when your donors make online shopping purchases through their network of online stores. A charity mall sells no products of its own; instead, it acts as a central web location for other online vendors. Both charities and donors can benefit from this system. Charities can receive donations with little or no effort on their part. Donors can make donations without increasing the cost of a purchase they may have been planning to make anyway.
It might be an effective strategy to work with such a charity mall, but don’t expect to make easy money. Since commissions are usually small, it takes many sales to produce a sizeable donation. Charity malls are common in the USA but not yet in Europe.
Another technology which takes advantage of the Internet’s potential is “dynamic commerce” in an open marketplace. The online auction model is one in which participants bid for products and services over the Internet. This online auction offers no strategic advantages for charities, however, and will therefore not be an interesting option. Unless organizing an exclusive charity auction of course.
Mobile technologies (including SMS donations)
Just like the Internet, mobile technologies such as SMS (short messaging system) and WAP (wireless application protocol) are also becoming part of our daily lives. But unlike the Internet, their impact on fundraising is less significant.
While mobile technologies are accessible and convenient for donors, their effectiveness for fundraising is restricted. The limited number of characters and screen space as well as the speed or expense of available bandwidth are substantial disadvantages. Charities should therefore proceed with care when organizing SMS campaigns. Nevertheless, the worldwide SMS campaign following the Southeast Asia tsunami in December 2004 was effective.
Digital TV viewing is fast becoming a common phenomenon, but use of its interactive features such as interactive advertising is still rarely done. For charities, interactive television is not very effective: interactive services require a telephone connection, and the costs of the call are added to the donation. Before committing funds to the use of this medium, charities should obtain clear information about the potential reach for their interactive advertising.
This article was prepared by SAZ Marketing AG