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ONLINE FUNDRAISING

Growth of Online Fundraising

Online giving continues to increase as donors become more comfortable with online transactions and as nonprofits become more sophisticated in their use of the Internet and email to raise funds. Online donations have steadily increased from $192 million in 1999 to approximately $1.5 billion in 2002 and to $3 billion in 2004. (Wired.com, February 2006)

The examples below reflect the power and growing popularity of the Internet in raising online funds:

  • The (Howard) Dean for America Presidential Campaign raised nearly $3.6 million online in its first 90 days and half of its $14.8 million total in the third quarter of 2003. (Convio. com)
  • Following the 9/11 terrorists' attacks in 2001, the American Red Cross raised more than $1 billion in disaster relief - three percent of these funds were raised online. Three years later, 28 percent of the $568 million raised for the Asian tsunami disaster came from online giving. By 2005, online donations accounted for over half of the $8.3 million the organization raised for South Asia earthquake relief. (Wired.com)
  • In 2003 employees at 595 companies pledged $110 million through United eWay, United Way of America's online fund-raising system, up from $80 million in 2002 and $20 million in 2001. (Groundspring, Making the Most of the Web and Email to More Money Online)
  • In 2003, Groundspring.org processed online donations for 650 small and medium-sized charities, handled more than $1.8 million, up from about $1.1 million in 2002. Since its inception in 1999, the San Francisco-based non-profit has processed $17.3 million in online donations for more than 1,500 nonprofits. (Groundspring, Making the Most of the Web and Email to More Money Online)
  • For their 2005 Courage Classic cycling event, Children's Hospital Foundation in Denver used pass-along fundraising to raise nearly $250,000 online, a 223% increase from 2004. Twenty four percent of the total funds were raised online. Pass-along fundraising allows subscribers to create their own personal online fundraising pages which are usually branded by the organization. Subscribers then send emails to their personal network inviting them to visit the Web page and donate to the cause. (eNonprofit Benchmarks Study, M+R Strategic Services, Advocacy Institute, 2006)

The eNonprofit Benchmark Study (2006) examined the Internet's effectiveness as a tool to help nonprofits raise money and affect change found that online fundraising increased by 40 percent between 2004 and 2005. Study nonprofit participants averaged $2.5 million in online donations, with a $97 average gift. The increase was due in part to the Asian tsunami disaster.

Nonprofits that invested in larger online communications budgets developed larger email lists and raised more funds online. The eNonprofit Benchmark Study, conducted by the Advocacy Institute and M&R Strategic Services, examined online statistics of 15 U.S. nonprofits, data from three major online communication tools providers and an online survey of 85 nonprofits. It also found that along with an organization's Web site, email messaging was the most important component of a nonprofit's online communications programs.

Those organizations that were most successful at online fundraising in terms of amounts raised, exhibited the following characteristics:

  • Larger email list size
  • More Web site traffic
  • Larger online communications budgets
  • Long term online fundraising programs
  • Coordinated online fundraising with online advocacy
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