Proving that social media can be used to raise significant funds for nonprofits is “the brass ring” that every nonprofit utilizing social media wants to reach. But it is quite an elusive brass ring! There are a number of challenges to overcome before social network fundraising is as easy (and fruitful) as email donation solicitation, offline donation appeals, or the “donate now” button on the website. On the other hand, social network fundraising is growing: both by adoption, use and acceptance. This post explores the existing challenges to acceptance and raising large amounts of funds using social networks – and brainstorming ideas to overcome the barriers.

Here are some thoughts about the leading challenges in social network fundraising:

Cultural: Social media is still primarily Social

Except for explicit business networking sites (Linkedin, Plaxo, association networks, and the like), social networking sites are still primarily used for…being social. Users are not generally thinking about these platforms as donation portals – yet. I think the social networker’s mindset is slowly changing as more organizations encourage their online fans to donate through social media platforms.

Where is the opportunity? Create real online relationships with stakeholders. By becoming an integral part of a fan’s social web, a donation request will be seen as an extension of the relationship. Nonprofits should identify and cultivate online influencers, and leverage the influencer networks during online campaigns.

Structural: How to Begin, How to Do It?

In these times struggling economic times, nonprofits are looking for new funding sources everywhere. Social networks are an obvious place to turn, but nonprofits aren’t sure how to begin.

In other words – how to do it? Do you create a small fundraising site that pushes people to share on their social networks? Do you run a fundraising campaign that is pushed on all of your relevant, engaged social networks? Do you create a campaign that is only run on one social network? I think the strategic effort involved in figuring this out is a barrier in and of itself. It’s not easy to plan any fundraising campaign, but the “new fundraising” on social networks has a lot of nonprofits wondering where to begin, and how to begin, and it’s a legitimate challenge they face. I don’t think there is any one answer – the approach depends on evaluating the organization’s campaign goals, current social media assets, and available resources.

Financial: Return on Investment

Hesitancy about the “return on investment” of a social media campaign is another concern. Organizations must devote staff, time, and financial resources to any online fundraising effort, and the return is still unproven, and without many benchmarks. We have some data about online donors: “engaged American donors,” the “wired wealthy,” and “social media power users who donate.” New research from Blackbaud shows that peer-to-peer social network fundraising in the past 12 months, using Facebook and Twitter, has generated $o.12 per impression, which offers a specific benchmark. However, social network fundraising is relatively new and untested, without long-term studies. The tools are constantly changing, and the success is wildly varied depending on the specifics of the organization, its social media implementation and use, and its online campaign. Taking this into account, organizations have to develop social network fundraising campaigns and strategies based on a realistic assessment of the return on engagement.

Challenges aside, I firmly believe online donations on social media platforms are the future.

• Social media offers incredible opportunities for nonprofits to reach out to the “borderless activist,” who is a source of new inspiration, energy and funds for every organization.
• More and more social media users want to get their information from blogs and social networks, and these sources are among the most trusted sources of organizational information.
• The viral nature of social networks means that strong social campaigns can spread more widely, and penetrate more markets, than traditional fundraising campaigns and events.
• Platform-based donations offer the perfect opportunity for transparency, which donors crave.

I’ve raised a few of the issues facing social network fundraising, and a few thoughts about how to address them. I’m sure there are a whole lot more. I’d like to open up this conversation and hear what you think are the current issues facing organizations raising funds through social media platforms – and the best means to overcome them.

I look forward to hearing what you have to say!

Debra Askanase has 20 years of experience working in nonprofit organizations, from Community Organizer to Executive Director. She is the founder and lead consultant at Community Organizer 2.0, a social media strategy firm for non-profit organizations and businesses. She blogs about the intersection of social media, nonprofits, and technology at communityorganizer20.com. Debra is an occasional contributor to eJewish Philanthropy.

image: courtesy of madnzany