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The Step Up Women's Network each spring sends 30 high school girls on a three-night, four-day tour of seven colleges in California's Bay Area. Fewer than half of the parents of Step Up teens have a high school degree and the tour, which stops at colleges such as Santa Clara University and the University of California at Berkeley, makes the college experience more tangible for the girls.
Some 91 percent of the teens rated the experience last year as "life-changing" and applied to at least one of the schools visited.
But, Step Up's Los Angeles chapter was feeling the economic crunch this year. The tour, which costs $300 per girl, was in a precarious situation. "At the beginning of the year we were looking at our budget, like almost all nonprofits. We are down in funding from corporate sponsors and that's what typically sponsored that tour. We looked and said 'we can't do this tour unless we are able to fundraise for it'," said Angie Grabski, Step Up's managing director in Los Angeles.
Step Up, a national nonprofit membership network, which relies primarily on ecommunications, sent out tour information in conjunction with other emails. The organization sent an email dedicated only to the tour, telling members, "What does it take to send 30 Step Up teens on a 3-night College Tour? You!"
The chapter reached its fundraising goal soon after the email, via gifts from nearly 60 donors, with four donors giving $500 or more. "I think it's because people really felt connected to it and they wanted to rally around it. It was something really tangible and they could say, 'This is what my money is going to,'" said Grabski.
Step Up's experience with ecommunications is just one example of how organizations are leveraging the Internet to fuel donations. And two separate studies released this year, Target Analytics' 2008 donorCentrics Internet Giving Benchmarking Analysis and The Convio Online Marketing Non-profit Benchmark Index Study, show that the Internet is a valuable tool for getting donations, even in a shaky economy.
Jeff Regen, Defenders of Wildlife's vice president of online marketing, said the Washington, D.C.-based organization saw a 24 percent growth in online fundraising when comparing the first six months of the current fiscal year, October 1,2008 to March 31, 2009, to the same period the previous year. In previous years, the online growth was between 30 and 50 percent for Defenders, according to Regen.
But in a year where some organizations see a flat-line or decrease in online gifts, Regen said the 24 percent growth is great. "We consider that good. I think we are doing better than most," he said.
Online communication is made for urgent, timely fundraising. Regen said Defenders' online revenue would have flat-lined, "if not for a few robust campaigns," including an eCommunication regarding the U.S. Secretary of the Interior's decision to remove wolves of the Northern Rockies from the Endangered Species Act protection and other hot-button topics. "Key, compelling issues that are in the news really helps our fundraising a lot," he said.
The Convio Online Marketing Nonprofit Benchmark Index Study evaluated nearly 600 nonprofits' online marking results across fundraising, email and other channels. The study showed that despite the economic fallout, online fundraising, email file growth and Web site traffic grew for the third year in a row, in a sub-group of 200 nonprofits that tracked that data.
"This is not a one-time anomaly," said Quinn Donovan, analytics manager for Austin, Texas-based Convio. From 2007 to 2008, online revenue levels increased 14 percent for the nearly 200 organizations in the sub-group. The study tracked a three-year growth for online revenue. Online revenue grew by 26 percent from 2006 to 2007.
Convio broke out the fourth quarter online fundraising results from 2006 to 2008 because concerns about the economy accelerated during that period. The study found that online fundraising experienced a 3 percent growth in 2008 compared to 2007, although it is far from the 29 percent fourth-quarter growth between 2006 and 2007.
This recent 14 percent growth was fueled by an increase in the number of online gifts, rather than a greater average gift. The organizations maintained an average gift of more than $67 between 2007 and 2008, according to the Convio study.
Web traffic showed a 20 percent growth rate from 2007 to 2008, down from the 27 percent growth tracked from 2006 to 2007. Organizations also grew their email files by 28 percent in 2008--a boon for nonprofits that want to sustain conversations and continue communications with online visitors.
Having an email address doesn't necessarily mean it works. Convio's study found that usable addresses only represent approximately 58 percent of the email file for most organizations. Some organizations create communities that maintain stronger email usability, such as higher education (74 percent) and membership and association organizations (67 percent).
While overall online revenue grew 14 percent, two organizational verticals declined from 2007 to 2008--environment and wildlife organizations (-8 percent) and public affairs (-5 percent). But online revenue for major emailers, defined in the Convio study as organizations with more than 250,000 constituent email addresses, within those same verticals weren't impacted as severely.
Donovan explained a number of factors, such as stronger brand and broader appeal, might give large, national organizations the competitive edge compared to smaller organizations.
"[Large organizations] normally have more resources, both from a budgetary perspective and also staffing perspective," said Donovan. "Their online and offline direct mail programs may be more sophisticated. When you factor all that in, that does give them somewhat of an advantage in a time where things are tough."
Large environmental emailers saw a 31 percent increase when measured separately, while public affairs major emailers experienced a 1 percent decline.
"And if I'm a small to mid-size organization, in the fourth quarter I could have been scaling back some of my programs to just try and make ends meet. And that, as a result, can also have an impact in the result those groups have," said Donovan.
"Everybody is doing something different. It's not like direct mail where people know I need a control package and a test package. I'm going to change one variable and know which one is better. There is all this tried and true science behind it. It's pretty wide open with the Internet and integrated giving," said Rob Harris, vice president of Target Analytics in Cambridge, Mass.
"It's not just a direct mail world anymore," said Harris. "Organizations need to figure out how to use their direct mail communication and their online communication in an integrated way so they can develop the right communication plan for their donors."
Target Analytics' 2008 donorCentrics Internet Giving Benchmarking Analysis examined the giving transactions from 24 reporting organizations--12 reported in the July to June year and the other 12 used a January to December year.
Group 1, the group of 12 organizations reporting from July to June, had a median increase of 39 percent for online donors and had a median decrease of offline donors reaching -3 percent from 2007 to 2008.
Those same 12 organizations had a median increase of 315 percent in online donors from 2004 to 2008 and a median 6 percent decline from offline donors during those five years. It's important to keep in mind that the median number of online donors in 2004 was a little bit more than 7,000, compared to 290,000 offline donors.
Online giving in Group 1 represented a median 11 percent of 2008 revenue for the 12 organizations reporting but just a median 9 percent of donors gave online in that year. That difference accounts for larger average gifts online. The study found that single-gift online donors gave approximately $27 more than single-gift offline donors ha 2008.
Online donation revenue was still greater than offline after controlling for household income and donor loyalty. Group 2, reporting from January to December, had an overall greater revenue for both online and offline donors. Single-gift online donors in Group 2 gave a median of $109 in 2007 while single-gift offline donors gave $64 that same year.
But the old rule that the higher the giving level the higher the retention rate flies out the window lot online givers. The study found there was a greater median percentage of offline original donors acquired in 2004 still giving in 2008 than donors acquired online.
When Group 1 was broken into original giving levels, only 15 percent of online donors in the $25 to $34 range were still donating by 2008, compared to the 25 percent for offline donors originally acquired in 2004. That trend of lower online donor retention continues across all reported giving levels--$35 to $49, 16 percent online compared to 25 percent offline; $50 to $99, 20 percent online compared to 26 percent offline; and, $100 to $249,24 percent online compared to 28 percent offline.
"Even though [online donors] look like they are slightly a little less loyal in terms of giving again to the organization, they give such high average gifts which is really a great thing about them," said Harris. "One thing we tried to do in the study is we looked at donors who came in at the same level--like a $50 online and $50 direct mail-acquired donor. Then you can really see that the direct mail donor is a lot more loyal."
Online was also a weaker channel for renewal--and more than a third of online donors moved to direct mail in their second giving year. Organizations in Group 1 found that a median 33 percent of online acquired donors in 2007 renewed their gift offline in 2008.
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