Nonprofits flunk online fundraising test

Nonprofits are creating online hurdles for donors, and as a result are missing the chance to raise millions of dollars, if not billions, a new report says.

While online giving accounts for only about 6 percent of total charitable gifts, “charities put up unnecessary roadblocks to donors giving online,” Rick Dunham, president and CEO of Dunham+Company, says in a statement.

The inaugural Online Fundraising Scorecard, a study by Dunham+Company and Next After, reviewed the websites of 151 organizations over nine months in 2013, signed up to receive emails, and made an initial $20 gift.

The study looked at 56 key indicators in four key aspects of online fundraising, including email registration, email communication, the donation experience, and the gift acknowledgement process.

Among the organizations in the study, 127 scored 75 or below.

Results of the study, combined with research showing that over two in three online transactions are abandoned, led to the conclusion that “there are millions — if not billions — of dollars being left on the table,” Dunham says. “Virtually every charity could improve the online giving experience for donors.”

In the area of email registration, 76 percent of charities make it easy to find their email signup form, although 66 percent of email signup provides little-to-no interest to potential donors, and 84 percent of charities present a non-exclusive signup offer, or one that is appealing because the donor cannot get it anywhere else, the study says.

Big factors in determining the success of  online fundraising, the study says, are the frequency and manner in which charities communicate with donors.

Yet over one in three organizations studied did not send a single email to new subscribers within the first 20 days of signing up, 79 percent of emails do not personalize the “to” line with a first and last name, and 56 percent of organizations did not make a single ask in the first 90 days.

In the area of online donation experience, 80 percent of organizations studied do present a clear call-to-action, and 85 percent have a landing page design that matches the email, yet 84 percent were not optimized for mobile viewing, the study says.

And in the area of gift acknowledgement, while 99 percent of organizations understand the importance of thanking a donor, the study says, 63 percent did not offer a donor “next steps” to take.

Todd Cohen

Causes, not organizations, seen as key for Millennials

To effectively engage Millennials, or people ages 20 to 33, nonprofits should focus on how the causes they care about affect individuals, while also delivering their messages using digital devices and social media that generation prefers, a new report says.

“Millennials are challenging the traditional methods of communication and marketing,” Derrick Feldmann of Achieve, a creative agency that released the report, says in a statement.

“Millennials want to succinctly know how their time, social media post, petition signing, and dollar will have an impact on the individual needing help or the issue they care about,” he says.

In fact, says the 2013 Millennial Impact Report, Millennials “number one pet peeve” is telemarketing and phone-based fundraising.

The report draws conclusions from previous research on over 11,000 Millennials, and from a national online survey that drew over 2,600 responses from 14 partner institutions, as well as video recorded feedback from 100 Millennial participants who tested nonprofit social media approaches, mobile websites, digital presence, and marketing messages.

After email, Facebook is the method Millennials prefer to stay current on organization issues, the report says.

Eighty-three percent of Millennials use smartphones, it says, and the two major activities they perform on their smartphones are reading email and following organizations on Facebook.

Mobile friendly websites are the most important feature from organizations that Millennials want on their smartphones, and they actively follow up to five organizations in social media.

The top action Millennials take on websites is to connect to the organization’s social media channels.

Key reasons Millennials volunteer are from passion, to make a difference for a cause they care about, and to meet other people passionate about the cause, the report says.

The most popular peer fundraising approaches Millennials use are run, race and walk events, the report says, and Millennials increasingly prefer to ask for a donation to an organization rather than to receive personal gifts.

When Millennials make donations, the mainly use and prefer online websites, and they are more likely to donate when the organizations explains how the gift will affect an individual, the report says

— Todd Cohen

Nonprofits urged to speak up on policy issues

By Todd Cohen

RALEIGH, N.C. — To be effective in helping to shape public policies on a broad range that affect them and their constituents, nonprofits need to do a better job framing their positions from the perspective of the Republicans who now control the governor’s office and a so-called “super majority” in the state legislature.

That was the advice of two policy experts who spoke to nonprofit leaders at a policy briefing in Raleigh sponsored by the Triangle Community Foundation and N.C. Center for Nonprofits.

Nonprofits need to learn to communicate more effectively with lawmakers and other government officials in Raleigh, David Heinen, director of public policy and advocacy for the Center for Nonprofits, told 140 people attending the briefing.

He and Ran Coble, executive director of the N.C. Center for Public Policy Research, reviewed the policy agenda likely to be addressed by Gov. Pat McCrory and state lawmakers, as well as the Obama administration and Congress.

Those policies involve issues that include taxes, energy, education, health care, voting laws, the state budget, and laws and regulations that affect nonprofits.

Coble said nonprofits, individually and collectively, can make a big difference by getting involved in policy discussions.

Heinen, noting they account for 1 in 9 jobs in the state, said nonprofits need to couch their policy positions in a “clear and compelling” way that shows “how they’re using taxpayer dollars” efficiently and effectively, producing “measurable results” that affect the lives of North Carolinians, and using public funds to “leverage” private support.

Because they are organizations that are trusted, he said, nonprofits also have an opportunity to get more North Carolinians engaged in voting and communicating with elected officials about a broad range of issues that affect them.

Nonprofits have been hit hard by the downturn in the economy, Heinen said.

Ninety-three percent have seen an increase in demand for services, 59 percent have not been able to meet the need for their services, and roughly a third have seen a decline in private giving for each of the last three years, he said,

Last year, he said, many nonprofits operated at a deficit, dipped into reserves, and cut staff or services.

The Center says collaboration between nonprofits and government has led to improvements in “red tape” from government grants and contracts, although nonprofits still are reporting inefficiencies in the government contracting system.

With changes in the state’s tax system expected to be a big priority for McCrory and state lawmakers, the Center for Nonprofits has taken the position that charitable nonprofits should be exempt from sales tax, a position it says is consistent with the practice in most other states.

The elimination of that exemption, he said, would cost charities $228 million a year in refunds.

The Center for Nonprofits has scheduled its 2013 Public Policy Forum and NC Nonprofits Day for February 25 and 26.

Legislative leaders and advocates will speak at the Public Policy Forum for North Carolina’s Nonprofit Sector on February 25 in the McKimmon Center, and will be briefed by the Center for Nonprofits the following morning in the Legislative Building, with the opportunity to spend the day talking with lawmakers.

Better communications seen as critical for nonprofits

Nonprofits are doing a poor job telling their story and need to improve their communications if they expect to survive in the face of serious threats to the social sector, a new report says.

Nonprofits believe government, the media and the general public do not understand the distinct values that make the social sector indispensable to society, and nonprofits also believe they need to communicate more effectively about their role and impact, says the report by the Listening Post Project of the Johns Hopkins Center for Civil Society Studies.

“Nonprofits are under assault today as perhaps never before, with consequences that could be profound for the future of these organizations and for those they serve, says the report, “What do nonprofits stand for?”

Half of over 750 nonprofits surveyed believe that “neither the general pubic nor government officials have a solid grasp of the nonprofit sector’s special qualities,” while over a third of survey respondents believe both the media and organizational funders are missing that information.

And nearly a quarter of respondents believe current and potential clients, customers, patrons and members are missing that information, says the report.

Sixty-two percent of respondents say the nonprofit sector does a poor job of articulating its special qualities to people outside the sector.

Nearly all nonprofits surveyed say improving their communications is important.

They also say undertaking a “serious, concerted and coordinated campaign to promote understanding of their core values” will require access to a range of resources.

Seventy percent say they need more resources for communications, 66 percent say they need to better understand how to measure their public benefit, and 65 percent say they need to better understand how to articulate their public benefit.

Better communication by nonprofits is particularly important in the face of an increasingly competitive marketplace that has created pressures that have pulled nonprofits “away from their historical modes of operation and from widespread widespread public assumptions about how nonprofits are supposed to operate,” the report says.

That volatile environment includes proposals to cap the federal tax deduction for charitable contributions as a common feature of budget-balancing measures “from both ends of the political spectrum,” the report says.

It also includes the imposition by a growing number of state and local governments of new taxes and other fees on nonprofits, and shifts in government payment methods that give advantages to for-profit businesses and have led to “significant loss of market share for nonprofits in a number of traditional nonprofit fields of activity.”

Nonprofits are “caught in a force field with powerful impulses pulling them simultaneously in different directions,” says the report, citing research by Lester Salamon, a co-author of the report and director the Center for Civil Society Studies.

Those impulses are pulling them “toward their voluntaristic past, toward greater professionalism, into expanded civic activism, and into deeper engagement with commercialism and the market,” the report says.

“While this movement toward a more commercial model has given nonprofits access to new funding streams and greater emphasis on efficiency, the resulting moving away from the most deeply held public conceptions of the sector has occasioned a series of challenges, including a key erosion of public trust,” it says.

And given the “enormous diversity of the nonprofit sector,” forging a consensus about the core values of the sector “poses an enormous challenge,” it says.

It is time for nonprofits, the Center for Civil Society Studies says, to “renew their value commitments and to develop the tools needed to communicate those values to the sector’s stakeholders in government, the public, and within the sector itself.”

Todd Cohen

Nonprofits holding their own, survey says

Membership and funding are growing at nonprofits, but many also are seeing a rise in operating costs and need additional staff they cannot afford to hire, a new survey says.

“Generally speaking, the health of nonprofits appears stable or growing,” says the Constant Contact 2012 Nonprofit Pulse Survey.

Based on a responses in May from 307 nonprofits from marketing firm Constant Contact’s customer base, 67 percent expect membership or funding this year to be more than last year, while  7 percent expect it to be less.

Forty-nine percent have seen an increase in membership and funding this year, while 12 percent have seen a decrease.

And 55 percent have adequate cash flow.

But 46 percent of nonprofit are seeing higher operating costs, 35 percent need additional staff but are not able to hire, and 51 percent have increased the number of services they offer.

Asked what keeps them up at night, 64 percent said how to attract new supporters, 59 percent said how to connect and better engage with existing supporters, and 57 percent said getting funding.

Eighty-six percent of nonprofits responding to the survey said email is an effective marketing tool, while 80 percent said website marketing was effective, 73 percent said in-person interactions were effective, and 70 percent said events were effective.

Fifty-eight percent said social media marketing was an effective marketing tool, and among those, 88 percent said Facebook was most effective, compared to 5 percent that cited Twitter and 1 percent that cited Google+.

New source for nonprofit news, services

Friends,

After 21 years of reporting on the charitable world, I have officially launched Philanthropy North Carolina, offering news and media services for nonprofits.

I also have left the Philanthropy Journal, a publication I edited since founding it in 1993.

I left because the Institute for Nonprofits at North Carolina State University, PJ’s home since January 2010, eliminated my job, saying it wants to take PJ in a different direction. A second position at PJ also was eliminated, and the remaining two PJ staffers quit.

Through Philanthropy North Carolina, at www.philnc.org, I will continue to report on nonprofits, foundations, corporate giving, individual philanthropy, fundraising, and trends and best practices in the charitable world.

And I will be providing writing and advisory services for the sector.

I also will continue to write about nonprofits and philanthropy in my regular columns in the Business Journals in the Triangle, Triad and Charlotte areas of North Carolina, and for The NonProfit Times.

So please visit Philanthropy North Carolina, sign up for my free newsletter and RSS feed, send news when you have it, and keep me in mind for writing or advisory work you may need at your organization.

Details about the services I am offering can be found on the Philanthropy North Carolina website.

This is an extraordinary time for charitable world.

The economy has slammed nonprofits and funders alike, and the future is uncertain, if not grim, to say the least.

But tough times also represent an opportunity for change and innovation, and for getting back to basics.

I look forward to continue reporting on the important work all of you do, and working with you to advance our collective mission of serving people and places in need.

Todd Cohen

Political values tied to charitable giving

Americans are more likely to give to a charity that reflects the values of their political affiliation, a new research paper says.

Donations to a specific charity by Republicans and Democrats are strongly affected by their perceptions of its alignment with each party’s respective “moral foundations,” Vikas Mittal, co-author of the paper and a marketing professor at Rice University, says in a statement.

Republicans’ moral foundations are rooted in respect for authority and traditions, loyalty and purity, he says, while those of Democrats are rooted in equality and protection from harm.

“The political divide not only impacts political actions, but everyday actions such as donating to charity,” he says.

The paper, which will appear in the International Journal of Research in Marketing: Special Issue on Consumer Identities, is based on three studies.

Two of them consisted of nationally-representative samples of adults, while a third was based on a randomized experiment with students who were asked why liberals or conservatives would give more or less to a specific charity.

In that experiment, researchers gave participants a description of the same charity, Rebuilding Together.

But they tweaked small parts of the description to suggest the charity either was supporting American traditions and loyalty or ensuring equality.

Among participants who indicated morals are highly important, Republicans were nearly three times as likely as Democrats to give when the charity was described as supporting working American families, following traditions and supporting their communities.

Democrats, on other hand, were twice as likely as Republicans to give when the charity was described as ensuring the protection of a home to every individual.

The researchers said their findings were supported in two additional studies that focused on children’s charities, including one for children’s advocacy that seeks to break the cycle of child abuse through prevention, education, advocacy and funding. The charity was described as in sync either with Republican values of purity and loyalty, or Democratic values of equality and protection from harm.

Focusing on participants who value morals highly, the researchers found that when the charity description emphasized protection from harm, Democrats were much more likely than Republicans to give, and when the charity description emphasized purity and loyalty to community, Republicans were more likely than Democrats to give.

“We found that while both Republicans and Democrats tend to equally value justice and caring for the vulnerable, Republicans place a much higher value on issues of purity and respect for authority,” Karen Page Winterich, study co-author and assistant professor of marketing at Pennsylvania State University, says in a statement.

“Given these differences,” she says, “Republicans are more inclined to donate to a charity when these values of purity and respect are met, whereas Democrats are more inclined to donate when the emphasis is purely on equality or protection rather than respect or purity.”

Yinlong Zhang, study co-author and associate professor of marketing at the University of Texas at San Antonio, says that, in addition to focusing on their main mission, charities “must also clarify how their mission is aligned with the moral foundations of a donor’s political identity.”

A simple “repositioning of the charity’s description so that it aligns with a person’s political identity can increase donation intentions two- or threefold,” he says.

“Of course, this raises important questions for charities in terms of their communication strategy,” he says. “But assuming this divide does not exist can only hurt their chances of maximizing donations from liberals and conservatives.”