In today's world, you can meet and date people over the Internet. You can shop for everything from food to cars to lower mortgage rates. You can traverse the globe's libraries, newspapers and real estate listings. The Internet gives you the world. And, of course, it opens doors for you to give, too.
The World Wide Web has become a tool through which the philanthropic community garners donations. People can donate money online to organizations, charities and foundations with a simple click of the button. Since 9/11, online donations have increased for national organizations like the Red Cross and Amnesty International. The American Red Cross received more than $63million in Internet gifts alone after the terrorist attacks. But is online giving, in its impersonal, electronic and automated essence, really the future of philanthropy?
"Giving through the Internet is probably still in its infancy," says Bryan Stuart, president of PivotPoint Foundation Consulting, based in Sandpoint. "It's mostly the bigger national charities -- and a lot of the ones sprouting up since 9/11 -- that have benefited from online giving."
PivotPoint helps its clients build and maintain private foundations through which people donate their money. Stuart says that while larger charities make money through direct Internet giving, the donation amount is typically small, and for the most part, big donors don't give through their computers.
Out of 135 charitable organizations surveyed by The Chronicle of Philanthropy (a biweekly newspaper for charity leaders, fund-raisers, grant writers and others involved in the nonprofit sector), only 12 of them raised more than one percent of their total revenue through online donations in 2002.
"You have to ask yourself, would you prefer to have a conversation or just to look at a Web site?" asks Stuart. "It's a relationship game, like sales. Every [nonprofit] organization needs donors, and they need to work with people on a personal level."
Although online donations aren't necessarily bringing home the bacon, they are picking up the slack where decreases in a shabby economy have left off. And the numbers show that online giving is gaining momentum. The 135 charitable organizations in The Chronicle of Philanthropy's survey raised more than $124 million in 2002. Forty-six of those organizations said online donations more than doubled from 2001 to 2002.
Putnam Barber, founder and president of the Evergreen State Society, a Seattle-based center for civic initiative and nonprofit resources, says online giving is gradually growing; soon it may compete with traditional forms of nonprofit solicitation, such as telephone calls or mailings.
"It's enormously sensible," Barber says. "It saves everybody trouble and money -- donors and fund-seeking organizations alike."
Charities and nonprofits have had particular success with online giving in monthly donor programs. It's easier for someone to set up monthly donations online by giving a credit card number, and having it automatically charged, than it is to get commitments from people who write out a check every month.
World Vision, an international-development organization in Federal Way, Wash., had about 10,000 people give recurring donations through its Web site in 2002. According to The Chronicle of Philanthropy, the average and lifetime donation for World Vision of an online donor is higher compared to a donor responding through another medium.
Spam and Scams -- While convenient and simple, online giving isn't without risks.
"It's a little dangerous -- especially for donors -- because it's awfully easy to think you're looking at the site [you want to donate to] and actually be looking at something else," says Barber. "Unless you're attentive, you could make a donation you didn't intend to, or worse, to someone pretending to be a charity."
Charity scams aren't anything new. Whether people are knocking on your door for donations or sending you e-mails, it's wise to research the organization, talk to someone who works for the cause and, depending on how big a donation you're going to make, even take a look at the organization's tax and financial forms. But common sense aside, many say the onslaught of legitimate charities asking for donations through e-mail may open up a Pandora's box of hoaxes. And Internet scams are hard to trace.
"The charity regulators have focused on the wrong part of the problem in my estimation," Barber says. "They put a great deal and energy into registering with the Secretary of State's Charity Division, but have no resources for pursuing real fraud or for monitoring the state of the industry to see if real fraud is occurring."
Scams are an ever-present possibility, but spam is a daily occurrence. Along with e-mails selling everything from diet pills to tropical vacations, charities are asking people for money by sending out mass e-mails. Most charities claim they send out e-mails only to members or those who've registered with them at one time. Some charities purchase e-mail lists from companies, the same way some spammers do. Senders of these mass e-mails say its not spam, and that the spam blockers on many people's computers are filtering out their legitimate donation requests. Yet some philanthropists disagree.
Michael Gilbert is a renowned fundraising consultant based in Seattle. He runs an organization called the Gilbert Foundation, which publishes news and commentary, as well as offers consultations regarding the world of philanthropy.
"As nonprofit organizations begin to embrace the enormous promise of e-mail marketing," Gilbert writes in a recent article, "they are on the verge of making a very big mistake that will damage their organizational reputation and the reputation of the sector. They are on the verge of becoming spammers."
Ann Price, director of development and communications for the Second Harvest Food Bank (SHFB) in Spokane, says e-mailing donors is an effective way to communicate with them about the organization. She makes the valid point that e-mail isn't much different from direct mail when it comes to solicitations.
"It's a part of relationship building. There are limited ways to contact people, and it's a competitive market. We're not the only people in this community asking for money."
Price says mass e-mails from the nonprofit sector aren't always unsolicited.
"There are around 5,000 donors who regularly receive our newsletters," Price says. "A lot of people would rather have it online than in the mail. We're a long way away from purchasing e-mail addresses, but we do [purchase addresses] for mailings."
Future or Fad? -- Online donations usually don't count for even one percent of the total giving to the nonprofit sector in a year, yet no professional fund-raiser or nonprofit specialist is ready to rule out online giving as a potential revenue source.
"This is going to change over the years," Stuart says of the small sums of online giving. "Many older people with wealth are already inundated with mailbox requests, or they've established a private foundation. Some don't have a clue about the Internet, though, some do."
Second Harvest offers online visitors a way to donate through its Web site, as well as the more successful direct mailing requests it sends out. Price says though online giving doesn't bring in much money, it's a part of the organization's outreach efforts.
"If they are paying their bills online, they can donate online, too. We're on the brink with those technology issues, and to have the technology available and to develop options around that [is better] than to not have it," Price says.
Second Harvest, like most nonprofits, receives less than one percent of its donations from online donors. It hasn't yet become all the rage, but online giving is burgeoning with possibilities.
Some of the new philanthropic activities in the cyber world include entirely Web-based private foundations, where family or board members who are physically distanced, can vote on grantees, hold meetings and have the money wired to the charity -- all without picking up a phone or leaving their desk.
The Internet doesn't just allow people to give online, but it also provides a forum to get more informed and have better access to the organizations you want to support. For example, GuideStar.org is a nonprofit cyber hub for anyone wanting more information about a nonprofit organization. By logging on to GuideStar.org, anyone can download the tax forms, which are public record, of the nonprofit, find out how it is registered and get links to similar organizations.
Spokane has its very own network of service organizations. Though not exclusively designed for the nonprofit sector, the programs linked to the Inland Northwest Community Resources Directory (TINCAN) provide accurate, up-to-date information on social, human, health and education services in the area at tincan.org.
It's clear that whether organizations are profiting through online giving or not, the Internet is a priceless tool for both donor and fund-seeker.
"Giving is based on a relationship, some kind of understanding of what [the organization does]," says Price. "A Web site can provide that relationship building."
And it can do so at the browser's convenience. Many people, especially the younger philanthropic crowd, feel more comfortable researching the nonprofit sector online.
Barber agrees: "It's really just preference," he says. "It's just another way of talking to people."
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Publication date: 08/07/03