Online Charitable Giving Tops $96-Million

Donors contributed more than $96-million over the Internet last year to 126 of the nation’s

largest charities, according to the Chronicle’s third annual survey of online giving.

Three organizations reported that online donations accounted for more than $1 of every $7 they raised in the 2001 fiscal year. United Way of Tri-State, in New York, raised $27-million online, 19.3 percent of its total contributions; United Way & Community Chest of Greater Cincinnati raised $10.6-million (18.9 percent); and Compassion International, in Colorado Springs, $16.8-million (15.3 percent).

More than two-thirds of the 197 organizations that responded to the survey said they did some form of online fund raising last year.

Growth Expected

The number of charities raising money online can be expected to grow, the survey results suggest. During the 2001 fiscal year, 32 charities began efforts to raise money online, and 20 charities said they planned to start or had started online-solicitation programs during the 2002 fiscal year.

While The Chronicle survey focused on donations that are transmitted electronically to charities, it does not reflect other kinds of donations spurred by online activities, such as gifts mailed to charities after donors visited an organization’s Web site or received an e-mail appeal.

In other survey highlights:

• Of 86 organizations that provided online-giving figures for the 2000 and 2001 fiscal years, the median increase in the amount raised was 120 percent, meaning half of the charities had larger increases and half had smaller increases or posted declines. Forty-eight groups reported that online donations rose 100 percent or more between the two fiscal years. However, the online dollar amounts for each year are small when compared with the total amounts raised. For example, the New York Public Library raised $17,549 online in the 2001 fiscal year, more than double its figure for 2000, but still only 4 percent of the library’s total contributions last year.
• Of the 130 charities that responded to questions about how they raised money online, 128 said they used a feature on their Web sites that allowed donors to transmit contributions electronically. Forty-three charities said that in addition to their Web sites, they also used another site, such as Network for Good, to receive online contributions. Twenty-seven of 129 charities said they used an Internet auction site, such as eBay, to raise money.
• The United Way & Community Chest of Greater Cincinnati had the largest percentage change between the 2000 and 2001 fiscal years, with online donations shooting up more than 1 million percent. Two factors accounted for the change. One is that the United Way’s online contributions started from a tiny base. They totaled only $1,000 in 2000 and rose to $10.6-million last year. Also fueling the growth was an electronic on-the-job pledge program that the United Way set up with several companies in the Cincinnati area. Instead of using a paper pledge form, donors received an e-mail with a link to a secure Web site through which they could register their pledges and have money transferred from their paychecks to the United Way. Several other United Ways, including ones in Chicago, New York, and Seattle, also are using the electronic-pledge method.

September 11 Gifts

Money raised in response to the September 11 attacks is not reflected in figures for groups whose fiscal years ended before the disaster. For example, the American Red Cross, whose fiscal year ended June 30, 2001, did not include in its survey response the $63.4-million it raised in response to the attacks. Online fund-raising experts say that the large number of donors who made their first online gift after the tragedy could ultimately lead to an increase in online fund raising for all charities, but that it’s too soon to see if that is happening.

The Chronicle conducted its survey by polling all charities listed in last year’s Philanthropy 400, the newspaper’s annual ranking of groups based on how much they raised in private contributions.

The survey also went to 175 charities with incomes of $1-million or more that were selected randomly from the Internal Revenue Service’s list of charities operating in the United States. However, only 23 charities from the random sample responded, making it difficult to draw conclusions about online fund raising by smaller organizations. Figures from the random sample were not included in the survey results.

The survey was conducted by Martha Voelz with assistance from Marni D. Larose and Nicole Wallace.