Advancements in Charitable GivingEmma Behrens, April 2015

Advancements in GivingBy taking advantage of all that technology offers, charities can reach a larger

audience and spread their messages more easily.

From age-old fables and proverbs passed down through generations to the words of current leaders, the concept of charity has been around for millenniums. Even after all those years, it’s clear that philanthropic giving isn’t going anywhere. In fact, philanthropic activity is on the rise internationally. 1

Advancements brought by mobile technology and social media allow people to engage with charity in new ways. These tools are changing the way donors interact with charities, how charities prepare for the future and how companies should approach charitable giving. New technologies are impacting charity in two crucial ways: they allow charities to get money from the masses more easily and they use the influence of social networks to help charities gain momentum quickly.

1Forbes Insights, BNP Paribas Individual Philanthropic Index, Web, 2014

Tapping into Technology to Reach the CrowdAdvancements in technology are allowing charities to tap into the influence of the masses.

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Texting Away One tech-platform that enables these benefits is mobile-giving. Mobile-giving is generally done through a “text-to-donate” format, where people text a word, such as “donate,” to a given number. A set donation amount is then added to their monthly phone bill or subtracted from a pre-paid plan. Though cellphones have been around for several decades, it is only recently that mobile-giving has begun to change the shape of giving.

The Ease of Reaching Out Through texting and the internet, it is easier than ever before for organizations to reach out to large groups of people. Not only does the nature of these platforms allow organizations to reach a wider pool of people, but they also encourage people who otherwise wouldn’t have donated, often because of budget constraints, to donate by having small, affordable asks.

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To confirm your $10 donation to the

Red Cross Int’l Response Fund reply with YES. Reply HELP for

help or visit Redcross.org

Haiti

2 YES

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Strength in Numbers Crowdfunding uses the combined resources of many people to reach a monetary goal. It is a way of soliciting donations by asking for small donations from a large number of people. Taking little amounts adds up quickly though and by 2025, the global crowdfunding market is predicted to reach over $90,000 billion.1

Though, individually, the gifts are small, they add up quickly:• Donations to the mobile Text for Haiti campaign raised over $5 million in two days, through many

small donations2

• The small donations from crowdfunding add up to over $5 billion annually3

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Small but Mighty

• Forty-five percent of Haiti text-to-give donors donate, on average, $100 or less annually to charitable causes, which is significantly less than the $2,974 than the average US household donates to charity annually.4,5

• The average size of donations made via crowd-funding platforms is $88.22, which is just about half the amount of the average online gift.6,7

$146

$88.22

Overall OnlineGifts

CrowdfundingGifts

Average Gift Size6

1 Noyes, Katherine. “Why investors are pouring millions into crowdfunding.” Web. 17, Apr. 2014.2Newmark, Craig. “Cracking the Crowdfunding Code.” Web. n.d.

3American Red Cross. “We are now confirming…” Web. 14, Jan. 2010. 4Smith, Aaron. “Profile of Haiti text donors in this sample.” Web. 12, Jan. 2012. 5The Center on Philanthropy at Indiana University. “Charitable Giving Statistics.” Web. 2015.6Newmark, Craig. “Cracking the Crowdfunding Code.” Web. n.d.

7MacLaughlin, Steve. “5 Facts About Average Online Gift Size. Web. 7, Mar. 2013.

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More Money Given These platforms have allowed charitable giving rates to continue to rise in the United States. In fact, the total amount given by individuals, adjusted for inflation, rose consistently from the early 2000s until the Great Recession in 2008. It dropped in 2008 and 2009 but has continued to rise since then, meaning that people are giving more with every passing year.1 In 2013, 95.4% of households give to charity.2

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Impulse Giving Text-to-give campaigns overcome several barriers to giving by requesting a low monetary amount and by providing a convenient way to give. As a result, many donations made to these campaigns are impulse donations.

• BBC’s Sport Relief event raised over $55 million in six hours, much of it through mobile gifts solicited during the television programming.3

• Half (50%) of Haiti text-to-give donors donated immediately upon learning about the text donation campaign.4

• 75% of Haiti text-to-give donors said that their text message donations typically were spur-of-the-moment decisions.5

1National Center for Charitable Statistics. “Charitable Giving in America: Some Facts and Figures.” Web. 2013. 2The Center on Philanthropy at Indiana University. “Charitable Giving Statistics.” Web. 2015. 3 British Broadcast Corportation“Sport Relief: Stars help to raise more than £51m.” Web. 22 Mar. 2014. 4Smith, Aaron. “Real Time Charitable Giving.” Web. 12 Jan. 2012. 5Smith, Aaron. “Real Time Charitable Giving.” Web. 12 Jan. 2012.

75%of donors said donations via text message were typically

spur-of-the-moment decisions.

Socially Propelled GivingAdvancements in technology are allowing charities to tap into the influence of the masses.

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Though online giving increased at triple the rate of overall giving, it still accounts for less than 10% of total giving.1 However, perhaps more meaningful than the platform of online giving, is the network for promoting charitable giving that the internet creates. These networks help charities by providing a social endorsement for the quality of organization and by helping news of campaigns spread quickly and cost-effectively.

2Personal Endorsements Through social media, it is easy to see what organizations friends and family are donating to which can act as a personalized recommendation about the charity. In fact, almost seven out of ten (68%) people on social media would take the time to learn more about a charity if they saw a friend post about it and over one in three (39%) would donate to the charity.2

If my friend posted about a charity on social media, I would donate to it.

39%1The Network for Good. “The Digital Giving Index.” Web. 2014. 2MDG Advertising. “It Was A Very Good Year for Social Giving.” Web. 2012.

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BUT… “Likes Don’t Save Lives” Despite the benefits of social media, some are critical of its effect on charity saying it has lead to “slacktivism.” Slacktivism is when people support charities through actions such as ‘liking’ the charity on Facebook, without donating physical resources such as money. As UNICEF Sweden pointed out in a poignant campaign, likes can’t be used to buy vaccines or fight disease. • Nearly 15% of adults surveyed as part of this campaign

believed that ‘liking’ a organization on Facebook was equivalent in value to donating money.2

$ 1 in 7 adultsbelieve that a like on Facebook is

equal in value to a monetary donation

1 Achieve. “The 2013 Millennial Impact Report.” Web. 2013. 2 Grummas, Emma. “Likes don’t save lives- lessions from a social media campaign.” Web. n.d. .

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Willingness to Share People, in particular millennials, are happy to engage with non-profits on social media. Three out of four (75%) millennial respondents said they would like, retweet or share posts, video or images from non-profits.1

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Positive Peer Pressure Another campaign that owes its success to social media is the ALS Ice Bucket Challenge. In this challenge, donors shared a video of themselves pouring ice water over their head to raise awareness for amyotrophic lateral sclerosis. They then nominated three friends to participate and donate. Having each person nominate three additional people allows news of the campaign to spread exponentially. The public nature of these nominations on social media added pressure for the nominees to take part.

The Icy Facts:• 2.4 million Ice Bucket Challenge videos were uploaded to

Facebook2

• 3.7 million videos on Instagram were tagged #ALSicebucketchallenge or #icebucketchallenge3

• Because of the Ice Bucket Challenge, the ALS Association Raised over $100 million in 30 days, compared to the $2.8 million raised the previous year in the same time frame 4

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2.4 million and 3.7 millionIce Bucket Challenge videos were

uploaded on Facebook and Instagram respectively

1 Herrling, Sheila. “#GivingTuesday Moves from Campaign to Tradition.” Web. 3 Dec. 20142 Townsend, Lucy. “How much has the ice bucket challenge achieved?” Web. 2 Sept. 2014. 3 Townsend, Lucy. “How much has the ice bucket challenge achieved?” Web. 2 Sept. 2014. 4 The ALS Association. “The ALS Association Expresses Sincere Gratitude to Over Three Million Donors.” Web. 29 Aug. 2014.

#ALSicebucketchallenge

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#GoneViral The nature of hashtags and sharing on social media also benefits charities by allowing them to create events which can easily and inexpensively gain virility. One event that has taken advantage of online’sability to generate excitement is #GivingTuesday, a day encouraging people to donate to charity. From 2013 to 2014, #GivingTuesday saw a 63% growth in donations.1 One reason for the continually increasing success of the event is that it is utilizes the underlying nature of social media to generate buzz. The fact that the name of the event is “‘hash-tag’ Giving Tuesday”, sets the day up for success on sites such as Twitter that promote posts with trending hash-tags. Through these tags, it is easier than ever for causes, events and campaigns reach a viral level of publicity.

Moving Charities ForwardLooking forward, how can charities and the businesses that support them take advantage of these changes?

1. Customize the ask amount. • Different demographics donate through different platforms. The average monetary value

of each donation from these different demographics varies greatly. Be sure to customize the amount asked for on each platform to reach different populations.

2. Create a relatable message. • Now, more than ever before, charities have the ability to reach people all over the

country and even the world. This makes it more important than ever for people to feel they have a connection to the work the charity is accomplishing.

3. Make it easy for donors to tell their networks about the charity. • People value their friends’ opinions . Take advantage of these free endorsements using

donors who are willing to share the charity’s information.

4. Build on existing memes and hashtags. • As trends gains virility, they continues to grow and spread. Charities can latch on to this

using creative takes on existing phenomena that are trending.