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More and more large nonprofit groups are raising money online, new Chronicle survey finds

A growing number of large nonprofit groups raise money online, according to a new Chronicle survey.

The survey, which was completed by 181 nonprofit groups, found that 100 organizations received online donations in the 2000 fiscal year. Another 43 groups said they planned to begin raising money online in the 2001 or 2002 fiscal years.

Last year, a Chronicle survey of 252 large groups found that 91 had raised money online.

Groups surveyed were ones that were included in The Chronicle‘s annual Philanthropy 400, which ranks the charities that raised the most money from private sources.

This year’s study shows that, while Internet fund raising is growing, many groups are still in the early stages of crafting their online-giving programs. But the study also suggests that many charities have not mounted online-giving campaigns with the same degree of aggressiveness that they might use in direct-mail or telemarketing campaigns. Of the 100 groups that reported raising money online in the 2000 fiscal year, 72 said they did not send e-mail solicitations to prospective donors. And only 11 of the 41 groups that send electronic newsletters to donors include fund-raising appeals in them.

In other survey highlights:

• Online donations amounted to less than 1 percent of all money raised from private sources among the 181 groups surveyed by The Chronicle. The online-giving totals, however, do not include gifts that charities attribute to online appeals but that were delivered through the postal mail or other traditional means. Nor do the totals reflect Internet-related fund raising other than outright donations. Goodwill Industries, for example, has received more than $2-million since 1999 through Shopgoodwill.com, an online auction site through which people can bid on items that have been donated to Goodwill.
• Forty-seven of the 100 groups that received online gifts last year said that at least a portion of the money had been donated through sites, such as Helping.org, that raise money on behalf of many charities. Thirty-two of the 100 groups received money from shopping sites, which allow customers to designate a portion of their purchases for charity.

Campus Crusade for Christ International, an interdenominational ministry and humanitarian group in Orlando, Fla., raised more last year in online donations than any other group in The Chronicle survey. The group took in $2.5-million in Internet gifts, up from $750,000 the year before. Officials of the charity attribute the rise to increased awareness of the group’s online-giving site and to greater comfort among donors with making online transactions.

The American Red Cross, in Washington, ranked second in The Chronicle survey, with $2.2-million in online gifts last year. That was down from $2.6-million in 1999, when the war in Kosovo and other crises elicited an outpouring of donations to relief charities. But the Red Cross’s online giving has since outpaced the 1999 figure. In the first 10 months of fiscal 2001, through this past April, the charity had raised $3.5-million online, according to Tish Mokrzycki, who works in online fund raising at the Red Cross. A significant portion of that amount came in response to earthquakes in India and Central America, she said.

Making It Easier to Donate

In interviews, many fund raisers said their groups started offering online-giving options because they wanted to make it more convenient for donors to contribute.

“It’s easier. They don’t have to talk to anyone, and they don’t have to go and get their checkbook out,” said Laura Mirkovic, Web site director at Catholic Relief Services, an international charity that has accepted online donations for two years.

Last year, Catholic Relief Services raised $325,100 from online donors, about 30 percent of whom had not previously given to the group.

In addition to responding to donors’ demands for a convenient way to give, some groups also see online fund raising as a way to pair other kinds of Internet technology, such as e-mail, and reach donors in an inexpensive way.

In spring 2000, Harvard University sent an experimental e-mail appeal to 4,000 young alumni, asking them to link to Harvard’s online donation site and give money using their credit cards. “There was some anxiety about whether people would find this intrusive, obnoxious, or undesirable,” said Andrew K. Tiedemann, director of communications for alumni affairs and development.

But, Mr. Tiedemann said, the e-mail appeal turned out to be a success, for two reasons: It drew responses from 169 people, who contributed a total of $39,000, the only donations through Harvard’s online-giving site during the 2000 fiscal year; and the experiment showed that alumni were not offended by e-mail appeals. Mr. Tiedemann said that only 2 percent of recipients selected an “opt-out” clause that allowed people to tell Harvard that they didn’t want to be solicited again through e-mail.

Demand for Quick Results

Organizations that decide to make online-giving programs a big part of their development mix will be far more successful, fund raisers say, if they offer well-designed Web sites and innovative marketing.

“The Web audience wants immediate results,” said Jacob Colie, Web designer at Mercy Corps International, a relief organization in Portland, Ore. “If they click ‘donate,’ they want to get to the form to donate, not layers and layers of options.”

Mercy Corps has received $525,000 in online donations since last July, the beginning of the 2001 fiscal year. That’s more than twice what it raised via the Internet during the previous fiscal year, and includes about $250,000 received in response to appeals for victims of an earthquake that struck India in January.

Encouraged by donors’ response to such disaster-related appeals, Mercy Corps officials have been soliciting gifts that are not related to one-time events to bring in money year-round.

One way they are trying to do that, Mr. Colie said, is by offering so-called Mercy Kits, which allow donors to contribute money online and send a personalized gift card and certificate to someone in whose name the gift is made. Each of five kits calls for a different donation level, from $20 to $75, and is earmarked for a specific cause. A $35 gift, for example, helps to provide food and medicine to a family in North Korea.

Mr. Colie said Mercy Kits accounted for $113,000 of the online gifts raised during the current fiscal year, including $93,000 donated during the Christmas season. The charity hopes to double its revenue from Mercy Kits in the 2002 fiscal year, he said.

Assuaging Fears

Other nonprofit groups use different strategies to attract prospective donors.

The University of Southern California introduced its online-giving option in November, running a full-page ad in the institution’s alumni magazine. The ad, aimed at former students of all ages, was intended to demystify online giving by saying that a donor does not have to be a computer expert to contribute through the university’s Web site. Since then, 23 donors have contributed a total of $1,086 online. But the university expects even more online support starting this summer after it unveils a newly designed Web site that will include a more direct route from the home page to the pledge page.

In addition, the university is planning to send out its first-ever e-mail solicitation. It will go to engineering-school alumni, a group that, according to a university survey, is likely to be receptive to an online appeal.

Seeking Stock Donations

While nonprofit groups like the University of Southern California are trying to do more to attract online donors, many also are seeking to integrate their online-giving programs with other development efforts that also use the Internet.

Ohio State University, for example, is examining ways to give online help to donors who plan to give stock. While such donations cannot be made online, the university may be able to use its Web site to provide donors and their brokers with the forms needed to complete the transactions, said Vince McGrail, who directs Ohio State’s online fund raising.

“Credit-card gifts are great, but we’d also like to promote stewardship, build relationships, and provide information through the Web,” he said. Ohio State raised $22,995 in online gifts in the 12 months ending April 25.

At the foundation that raises money for the University of Cincinnati, officials are keeping track of the number of visitors to the foundation’s Web site as diligently as they are tracking gifts. From last summer to this spring, the foundation collected only about $1,600 in online donations. But officials say they are encouraged that, during the same period, the pages on their site detailing how donors can make contributions received nearly 3,600 hits — a sign of online fund raising’s potential for the university.

At Wake Forest University, in Winston-Salem, N.C., fund raisers last year sent an e-mail reminder to alumni who had unpaid pledges and who had provided an e-mail address. Twenty-eight percent of those who received the e-mail paid their pledges before the end of the year, while only about 19 percent of others fulfilled their pledges in that period, said W. Tim Snyder, who oversees online fund raising at Wake Forest.

Likewise, Wake Forest used an e-mail appeal last September that spurred 350 alumni to donate a total of $173,000 — but only 78 of those donations were made through the kind of online gift form captured in the Chronicle survey. The rest were delivered through more traditional means, such as through the mail, said Mr. Snyder. “People may be responding to an electronic solicitation, although they don’t make the transaction happen online,” he said.

Mr. Snyder cited an alumnus who was inspired by Wake Forest’s Web site to make a large donation. After contacting the development office via e-mail to discuss the ways he could contribute, the man dropped by the university one day to donate $40,000. “The only non-electronic experience,” Mr. Snyder said, “was when he stopped by with the check.”

Debra E. Blum and Martha Voelz contributed to this report.