National Park ServiceU.S. Department of the Interior
Partnership header Roundtable discussion in a conference room setting

Cost Effectiveness of Online Fundraising in Reaching New Donors

The Internet and online fundraising enables organizations to better serve donors and reach a much wider audience than they might otherwise have the resources for in less time and at a lower cost than other forms of fundraising. In 2006, it cost nonprofits $1.25 to raise $1 from a new donor via direct mail, $.25 from an existing donor via direct mail, $.60 via telemarketing and $ .10 via online. ("Click Here to Donate,", February 2006)

Online donations eliminate the costs and time associated with printing, stuffing and mailing pledge reminders. With postal rates increases in May 2007 - the Standard Nonprofit Rate hike varied from 2 percent decreases to 125 percent increases, depending on a variety of factors such as automating and sortation levels - direct mail campaigns have become more costly for nonprofits.

The savings in resources from online donations can be directed to programs, projects and marketing an organization's mission and programs. With online donations, staff don't have to worry if the check is in the mail, type the donation information into a donor database, or send paperwork to the bank. Online transactions provide guaranteed funds and quicker access to donations that can be deposited into a bank account within a few hours. The Internet can also attract higher average donations due to the more affluent and higher educated households that have Internet access ac compared to those who don't.

Donor information captured online can be integrated into an organization's donor database with little effort. It can be used to cultivate relationships by updating donors about events, opportunities to volunteer, upcoming campaigns and breaking news. A donor database should enable an organization to track online donations from current and new donors and analyze the effectiveness of its campaign.

Email is a foundation on which an organization can build relationships with constituents, members and donors. Emails inspire and invite members to give and are the secret to securing more than one online donation from an individual. While the Web site informs, educates and serves as the location where donations are made, emails are the vehicles that drive donors to the site. Only a few donations will be made as a result of someone surfing the Web and discovering a Web site. Through email it is possible to contact supporters from different geographic locations or those within close proximity.

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