Tad Druart

Being a father of high school and college age daughters, I say "I just don't get it" quite often. I admit that I also question some of the things my parents say and do – I thought I raised them better. :-) The generations are different...

Today, Jordan Viator, our super communications manager for all things interactive, fun and digital was featured in The New York Times about using Foursquare to broadcast to her friends where she is during SXSW Interactive. I personally don’t get it. Why would you do that? I know she says that about a lot of things I do, as her generation has many questions for us "older folks" and they are not afraid to ask. Of course, I probably wondered why anyone would use Facebook and Twitter at some point and now I use them regularly.

The reality is there are generational differences in the way we engage and the way we live our lives. (I’ve put a lot of "duh moments" into these posts lately.) To efficiently and effectively manage my life – family, work and beyond,  I need to understand the generational differences of the people I interact with.

It’s no different with fundraising.
 
Anecdotally and intuitively nonprofit professionals know that changing demographics and technology are driving a shift in charitable engagement. Questions abound:

• How do donors of different generations learn about nonprofit organizations?
• What are their preferred channels for engagement?
• What are the most appropriate channels for fundraising?
• Who and what influences their giving decisions?
• What will the on-going value of direct mail be versus online and emerging fundraising channels such as social media and mobile?

While much has been written about the differences between the generations, there has yet to be an in-depth study on the charitable giving habits, preferences and differences for Gen Y, Gen X, Boomers and Matures. Until now.

Working with our friends at Sea Change Strategies and Edge Research announced the results of a first-of-its-kind national research study into the charitable giving behaviors and attitudes across Gen Y, Gen X, Boomers and Matures. This is the same team that brought you the "Wired Wealthy." Some of the key findings will change the way nonprofit’s approach the art and science of fundraising.

The full report is available at: www.convio.com/nextgen

In the coming weeks we’ll be posting more information and hosting webinars, but for now, I wanted to introduce the research to you. In this economy we can’t afford to say "I just don’t get it" when it comes to engagement with donors and prospects. We can't let the shifting demographics and ways in which people use technology get too far ahead of us - leaving our mission behind. Like the "Wired Wealthy," this is a must read for the modern fundraising professional. We already pulled some of the data for a feature research package on mobile giving, particularly related to the response to the earthquake in Haiti. There is more to come.

(I have to admit the irony of seeing Jordan, the digital-force for our social media, blog and online efforts in print today, made me smile.)

As I look back at my communication’s and development career technology has changed the way I work - I remember the days when we had a major product launch and had teams of people in New York and Washington D.C. the morning of the announcement to "run" the press releases to the key media outlets/reporters. Technology has changed all that. I can hit the send button and send the press release to everyone who wants it at the same time. My mobile phone’s GPS has also changed getting me to the right place mostly on time. Because of technology reporters are no longer confined to the publisher’s building – my last press tour took me to the homes of reporters in three small towns for kitchen table product demos. (With virtual meeting tools and video conferencing, we’re even doing less of that.) As an event fundraiser, I remember fighting for walkie-talkies during fundraising events, just to stay in touch with my co-workers and volunteers. Do you remember how hard it was to get in touch with a key volunteer once they headed home for the evening... (Man I’m old – two miles up hill, both ways through the snow kind of old.)

Of all the communication technology the mobile phone is probably as disruptive as any... I noticed last night how it has changed dating for my teenage daughter.

As a father, I like the fact that when my daughter and her boyfriend are sitting together on the couch they continue to text friends, while they talk with each other and watch TV – I encourage the keeping of hands on mobile devices at all times. Had W. Bruce Cameron'sbook "8 Simple Rules for Dating My Teenage Daughter" been written today, we’d add a chapter about the benefits of boyfriends who continue to text friends while on dates with one’s daughter. That’s probably a better story for a post on fatherhood though. But I digress...

The most recent development with mobile technology is that of a giving platform. In the aftermath of the Haitian earthquake close to $50 million was given through this channel. Although gift amounts were limited to $5 to $10 dollars an estimated 6.5 million people used their cell phone to donate. This was unprecedented level of giving through this channel and might mark the tipping point for greater adoption.

We teamed with Edge Research andSea Change Strategies on a national survey of US charitable donors conducted one week after the earthquake in Haiti, and during intense fundraising efforts for emergency relief – this is part of a broader study that will be released in the coming days on the contrasting charitable habits of Gen Y, Gen X, Baby Boomers and Matures to provide the nonprofit sector with insights on cultivating the next generation of American donors.(This is the same team that gave us the ground-breaking research on the "Wired Wealthy.")

Here are some of the key findings. 

• 77 percent of respondents were aware of the Haiti text-to-donate efforts
• 17 percent of Gen Y respondents and 14 percent of Gen X made a donation to Haiti relief efforts via text message, and 3 percent of both Boomer and Mature respondents made a donation to Haiti relief efforts via text message
• 28 percent of respondents with a mobile Facebook application texted a gift 
• Generally speaking, 15 percent of all respondents were willing to donate via text message after an emergency occurs and 11 percent were willing to donate via text message if a friend is raising money
• Just three percent of donors say that they received a text/SMS message from their top charities this year
• However, those who have received information from a top charity through text/SMS, feel that it is an important way to stay in touch with the charities they care about (71% say it is important).

 You can download the full study at: www.convio.com/mobile2010

When you look at this data, the results Convio’s clients are having online with fundraising, advocacy and other forms of engagement, the segmentation and donor relations pathways that are now available through open database systems like Convio Common Ground, all tied to modern technology it is an exciting time to be part of this sector. While the economy is having a negative impact, it is also driving innovation as people look for more efficient and effective ways to operate their organizations, to reach and cultivate donors and spread the word about their causes.

The only certainty we face is change and those that embrace change will be best positioned for the future. We must adapt to change, to data intensive applications and new technologies that push us in new directions and beyond our comfort zone.

Now, its' time to send an "REI" text to my daughter as she’s upstairs watching TV with her boyfriend. What does REI stand for? It’s dad for "response expected immediately." Much like mobile fundraising – donation expected immediately...oh how the world has changed.

Back in February there was a great deal of discussion and debate on the role of tax-deductions in charitable giving around proposed changes in the tax code. Some argued that giving is primarily altruistic and tax breaks play only a small role in the decision to give. Others argued it is very important and billions of dollars could be at risk if the government placed a limit on charitable giving deductions. Both the The Chronicle of Philanthropy and The NonProfit Times covered the story. Today, Stephanie Strom, Philanthropy reporter for The New York Times did a nice article around data from the Convio system that shows, at least behaviorally, the year-end tax deadline makes a big difference in online giving volume and revenue.

While the truth is probably somewhere in the middle, what is clear is that donor behavior in the last week of the year, particularly on the last day of the year, seems to suggest that getting that last gift in under the tax deadline is extremely important.

We looked back at online giving trends in the last week of the year, compared to the rest of the year and found that on 12/31 there was more than 13 times the number of donations and more than 22 times more funds raised than daily averages the rest of the year.

Here is some other interesting data that seems to confirm, at least behaviorally, that altruism and the tax-deduction go hand in hand (or hand in wallet).

• In the last week of the year (from 12/25 - 12/31), clients processed 4.9x the number of donations that they did in an average week.
• The amount raised was an even larger lift (7.7x the amount raised in an average week) indicating that the average gift size was also larger (57% larger).
• While every day in the final week of the year (including Christmas) saw an increase in average donations, the last 3 days of the year showed the most dramatic increases:
       1. 12/29 = 5x donation count and 7.8x in funds raised,
       2. 12/30 = 7.5x in donation count and 11.5x in funds raised,
       3. 12/31 = 13.2x in donation count and 22.5x in funds raised).
• In the last week, the top 10% of organization saw >10x increase in number of donations and >15x increase in funds raised.

Bottom line is that the last week of the year and in particular the last day of the year is huge for online fundraising.  About 90% of organizations take some advantage of this phenomenon with the top third of organizations raising 10x or more in the final week when compared to an average week. 

Dave Hart, our CTO offered me these observations about the data: The 10x lift would be a good target for an end of year fundraising campaign (a solid B grade), and an organization should not stop fundraising until the very end of the year.  An A grade for an end of year campaign would be 15x the normal weekly volume raised in the final week of the year.

This type of data is one of the many benefits of providing our nonprofit clients software and service through the SaaS model. It also can help provide insight into what your organization can and should be doing in the last week of the year. It also shows the need to have a donor database that allows you to segment based on the date of the gift, so that you can communicate, making sure you are top of mind on the last day.

It’s not too late – here are some tips from some of our experts that can help you make the most of the last week.

One final thought and question. I worked at an organization that was very active in water conservation.  One of our experts would always, and I mean always, get upset if people conserved water “for the wrong reasons.”  We had some deep and interesting discussions about that. My guess is that most people donate to your organization for more altruistic reasons over “just” the tax-deduction, but at the end of the day, does it matter if they give only for the deduction?

A little bit more about the data. This data excludes special events related (TeamRaiser) gifts and recurring donations and represents clients that: 
• were active fundraising prior to 1/1/2008
• averaged >1 donation/day in 2008 (ie. had more than 365 donations in 2008)

Despite the difficult economy, American consumers will be going online in record numbers to support charitable causes in the final four weeks of the year – giving an estimated $4B online. This according to The North American Technographics® Omnibus Online Survey, Q4 2009 (US), a commissioned omnibus survey conducted by Forrester’s Technographics® on behalf of Convio. More than 63% of online consumers plan to use the Internet to donate to charities of their choice during the upcoming holiday season, up from 51% in 2008 – when you look at the amount they plan to give it looks like organizations ready to engage online could see a more prosperous holiday season than those late to the online game.

In the tough economy that might not make up for the revenue that some organizations have lost, but it is a significant shift in the giving habits of the US consumer. There is a bunch of data, but here are a few things that jumped out at me:

1. The influence of the website on gift giving regardless of how the final gift is given – 44% of the consumers said the website was most influential in their decision to give – last year only 27% rated the website as the most influential. The website is like the front porch of your house – it might not be the most important part of the house, but it is what everyone sees – is it compelling and inviting them in?
2. Multichannel is alive and well – while these people prefer online, 61% wrote a check and mailed it, 38% gave at an event, 17% responded online to an appeal from a family member or friend in support of a run/walk/ride event, and 16% gave over the phone. If you are not investing in making all the channels work together you’re missing an opportunity or worse sending people elsewhere.
3. 60% of seniors – those over 65 years young - said they plan to donate online. Just last week I was told by an ED at a hospital foundation that my older donors are not online...really?  See point one above – they gift might not come in online, but they are online checking you out. Validation for the Wired Wealthy Study as well.
4. 40% of people said word-of-mouth influenced their decision and nearly 1 out of 4 said what family and friends said on their social media sites influenced their decision.  I’m not sure what to make of this completely, but one observation is that many NPO leaders trust word-of-mouth more than they trust social media – yet we don’t know what people are saying. While social media was honestly lower than I expected, it does show that if we provide content and ideas it will help influence giving. The key point here for me is that organizations need to provide their most passionate supporters with the tools (online and off) to help tell the story and engage people in giving.

Two other salient points that I took from the data show good news and bad news, depending on one’s perspective:

• 56% said most charity websites make it easy to donate.  That’s better than last year, but it also means almost half are not doing as good a job as possible.
• 54% said nonprofit websites do NOT make it easy to get the info needed to decide whether or not to donate.   Organizations still need to focus on the user experience, making sure all the right information is in the right places, easy to access, navigate, etc.  Is your site designed for them or for you and your leadership? That’s an important question to ask - hopefully you can answer it is designed for the prospect/donor, not the internal audience.

Hopefully you are executing a well thought-out and designed year-end campaign and are ready to engage these consumers as donors. If you are great. But if not, our experts in our services and support functions took the key findings from the survey and created a last minute guide to help organizations be more successful in the last four weeks of the year.  You can download the entire guide, but here is my summary of the information – really download the guide. 

Four tips to help succeed in the last four weeks of the year:

1. The website matters!  Optimize your website for giving – make it easy and make sure the information the consumer needs is easy to find - offer eCommerce options so consumers torn between buying a gift and giving a donation – let them  give a gift that does both. Regardless of the size of the gift or the final method of payment consumers are going to charity website and using technology to learn about and engage with charities.
2. Make every email count – make sure content is compelling and provides easy to see links to giving options – make sure it is consistent and integrated with other channels.
3. Empower your most passionate supporters to help tell your story through tell-a-friend emails, eCards, content for their social media sites and/or offer the ability for them to build their own personal fundraising page.
4. In the last week of the year, promote tax benefits – the last day of the year is historically the busiest day for online giving.

With consumer dollars being tight and the competition for donations growing, online marketing and fundraising continues to grow in importance for donors and organizations alike. It is clear that online giving has joined traditional channels as mission-critical part of the giving mix and successful organizations are investing accordingly in their online relationships. Don’t get tied around the $4B estimate, rather look at the millions of people that are available to engage and build relationships with this holiday season. Use this season as an opportunity to engage with them’ to cultivate a relationship; and create a sustained relationship that yields returns for many years.

With the Holiday Giving season ramping and the recession having a negative impact on donations, charities are expanding their eCommerce offerings to better meet consumer’s needs.  We are finalizing research into the holiday giving plans of consumers, but preliminary data show that 61% of online consumers plan to give online this year, up from 51% last year – that’s more than 106 million Americans giving online in the last 4 weeks of the year. 

Nearly 21% have not yet decided how much to give and to what charity.  According to the National Retail Federation U.S. consumers plan to spend an average of $682.74 on holiday-related shopping, a 3.2 percent drop from 2008. According to research in by the Chronicle of Philanthropy the top 400 charities expect 2009 giving to be down by as much as 9%. While there is no doubt that this is not good news, the data does shed light on opportunity.
 
Of that 106+ million people looking to give, there are about well over 20 million Americans who might be torn between buying a gift for a loved one or friend and giving to charity. Thus, we have talked to a number of clients who are giving constituents the best of both worlds this holiday season – giving the gift of charity and giving a gift from charity.
 
Our founder and CSO, Vinay Bhagat was quoted last week in The New York Times about the trend, and today our client American Red Cross was also written up in the Times about their first "Gifts that Save the Day" catalogue.  The Yellowstone Parks Foundation is offering their first online gift this year, and online stalwarts like World Wildlife Fund, Defenders of Wildlife, Oxfam America, Humane Society of the United States, Carnegie Museums of Pittsburg, UNICEF, Animal Humane Society, Project Bread and dozens of others are making it easy to give gifts to the people that mean the most to you and give to charity.
 
You can give everything from a traditional ornament  to lions and tiger and bears (Oh my) (really you can adopt a lion, tiger and/or bear), you can give bees and goats or even a pile of manure for that special someone...a little more traditional you can give museum membership or buy that Andy Warhol replica that would look great in the hallway...the really neat thing about shopping online from charity is it is easy to find the perfect gift for anyone – even the person that has it all. I'm really looking forward to seeing my teenage daughter when she learns she's getting manure - She'll be happy when she learns it supports Oxfam. Most importantly the gift you give to the person you love support causes that feed, protect and care for children, the poor and the homeless, protect wildlife and the environment, educate and enrich our communities and make a difference in the lives of millions of people – that is the true spirit of the season.

I KNOW that I have left off some examples of how our clients are using eCommerce and other Convio products to bring gift giving and giving together this year, so I ask you to share your opportunity here – let’s create a clearing house for online gifts that make a difference this holiday season.

Let’s help make the year-end giving season come alive for your friends, family and the nonprofits that make a difference.