The Sustainable Nonprofit - Microgifts and Impulse Giving Online
Microgiving is most often thought of as the charitable donation of small increments of money from a single donor to a specific recipient. Over the last decade, this giving option has developed into a marketplace where philanthropic needs are offered to a "customer base" in search of opportunities, causes, societies, and endeavors they want to invest in or otherwise support. Microgiving can be seen as having grown out of Nobel Peace Prize-winner Muhammad Yunnus's Grameen Bank initiative, which began thirty years ago to provide microcredit to individuals in Bangladesh. In its short history, microgiving has been largely the province of aggregating philanthropic Web sites offering a wide variety of giving opportunities.
However, microgiving can be an important fundraising tool for individual nonprofits in search of additional support for specific programs and institutional needs. Overall, it should be thought of as part of a small-gifts program. Traditionally, most nonprofit organizations have been inclined to concentrate most of their fundraising efforts and resources on seeking large donations and cultivating major donors — both individuals and foundations. Historically, smaller donations have been a strategy of annual fundraising campaigns to meet operational deficits.
Microgiving is a new way to seek smaller gifts, but it should not be thought of as an alternative to a traditional annual fund appeal. The annual campaign is the tool for offsetting operational deficits. Microgiving campaigns yield small gifts for specific purposes. They are a form of designated giving.
Small gifts have been known to provide major funding for organizations. Notably, Heifer International has relied on small gifts for more than 80 percent of its contributed income. More recently, true microgiving programs have played major roles in disaster-relief fundraising — the 2005 tsunami, Hurricane Katrina, and the 2010 Haiti earthquake.
In the case of Heifer International, small gifts were a successful strategy because Heifer developed what we have come to call alternative giving in the form of the Heifer gift catalog. This effort predates online fundraising but was given a substantial boost by the advent of Web site giving and e-mail solicitation. The microgiving efforts that have supported relief from disasters owe their success almost wholly to creating the opportunity for donors to make instant gifts online in response to their impulse to help.
Impulse giving goes hand-in-hand with microgiving. The Internet has made it possible for individuals to give to nonprofit organizations at a moment's notice. The Web brought a philanthropic mall to every computer. Then it created an entrance to that mall on the screen of every cell phone and the burgeoning collection of Web-connected handheld devices such as the iPad. Just as people can shop and make impulse purchases a result of seeing merchandise displayed at the physical mall, they can give impulsively as a result of having been exposed to need by an organization or cause that calls to them.
The smaller the size of the asked-for gift, the easier it is for someone to respond impulsively and make a charitable donation. That's why impulse giving and microgiving are so linked. If an organization makes legitimate cases for gifts in support of multiple philanthropic opportunities, people have shown that they will make multiple gifts. Ask for support for initiative A, then for B, and then for C, and a donor is more likely to give two or more times than if she is asked for three separate gifts solely to one of the initiatives. Each new case for support engages the donor in a fresh way. Each separate reason for giving provides the opportunity for a new impulse response. This is particularly true for individuals more invested in the work or content of an organization than in the organization itself — donors to whom mission matters most.
Microgiving and the Internet have lessened the threshold over which a donor must carry his gift. The harder it is to do something, the less likely we are to do it. The easier it is to do something — or the easier it appears to be — the more likely we are to overcome any resistance to doing it. The faster we can respond to a gift-giving impulse, the more likely we are to make the gift.
Charitable giving makes endorphins flow and people feel good. Our finger wants to push the button that sends the gift. But every additional step that has to be taken to complete our gift-giving impulse is a hurdle to overcome. The goal of organizations wanting to facilitate impulse giving is to remove as many of those hurdles as possible. The first three hurdles are the questions:
- Do I want to support this cause or purpose?
- Do I want to do it through this organization?
- What are the financial consequences to me if I give this much?
The case for support and call to action answer the first question. The credibility, reputation, and depth of relationship with the potential donor take care of the second. Size of gift is the answer to the third. Almost everyone can make a microgift without financial impact. Make the process easy and fast to encourage more gifts.
Developing a Microgiving Program
When we take into account what we know about the attractiveness of microgiving to today's donors — and in particular to younger donors — and what we know about impulse giving, it's easy to see why organizations should consider developing an initiative for seeking microgifts. A successful, ongoing microgiving program relies on:
- The identification of multiple, enticing, well-defined microgiving opportunities.
- The creation of strong, succinct cases for support and calls to action.
- Development of online and email media to present cases for support and calls to action.
- User-friendly online mechanisms for receiving microgifts, tracking goal progress, and reporting on the successful application of microgifts.
- Rapid creation and dissemination of microgiving opportunities.
So, what size is a microgift, and what is the dollar amount that makes a gift more than micro? There are no set numbers. One size does not fit all. A microgift is the amount of money that a person would not think twice about spending. For some that may be a dollar. For others $5. Still others $10 or $20, maybe even $100 or more. It's relative. When seeking microgifts, it's a good idea to rate the ability of potential donors to give. If you are making requests via e-mail to your existing donor base, you can do this by looking at past performance. The person who gives the organization $1,000 every year probably has a higher microgift threshold than someone who gives $100 each year. There is nothing wrong in segmenting your list and asking for different size microgifts. Just remember to create the supporting Web pages for each segmentation.
A microgift request needs to be tied to a specific need with a specific defined outcome resulting from the gift. If the organization needs money to:
- buy a machine
- pay an unexpectedly high power bill
- set up a services-delivery satellite office
- help a client in need
- recover seats in the auditorium
then a microgiving campaign might be the answer. However, any microgiving campaign is served best if the case for support is likely to engender an emotive response. Raise the emotional level, and the impulse to give kicks in. And microgiving campaigns are most successful when the impulse to give is at its highest.
Examples of Successful Microgiving Campaigns
In 2009, MyJewishLearning.com received a matching gift and decided to go to its readers for the necessary $10,000 in the form of microgifts. In appeals sent to its fifty thousand e-mail newsletter subscribers, the organization asked for individual gifts of $2. The appeal form also included check-offs for gifts of $5, $18, and $36. More than $11,000 was raised from eight hundred and fifty donors:
- 27 percent of the donations received were for $2;
- 35 percent of the donations were for $5 — the most popular amount; and
- 90 percent of donations received were for $18 or less.
Small Can Be Big is an organization in Waltham, Massachusetts, that specializes in helping local families experiencing or at risk of homelessness by harnessing the power of small donors, many of whom are young adults. Twitter and Facebook (through "Like"s) are key components in a strategy that yields a median donation of $15 for the organiazation. One case from late 2009 centered on a child in a homeless shelter who had cancer. In less than an hour, Kelsey Warner, a Small Can Be Big intern, put together a short profile and case for support asking for $1,500 to get the child and his mother into an apartment. The case was posted on SmallCanBeBig.org on December 1, and sixteen days later the goal had been reached. Eighteen people in ten states made gifts averaging $85 each.
The Microgiving Platform
Any fundraising effort needs a platform consisting of tools for creating and delivering the request for a donation and then a way to respond to the donor with appreciation for the gift and information about the impact of the gift. For microgiving programs that platform should consist of:
- a mini Web site or portion of the organizational Web site dedicated to the specific content of the gift request;
- an e-mail campaign capability for acquiring donations;
- a social media campaign capable of bringing in donations;
- an online donation acceptance mechanism that is quick, easy, and transparent;
- a branding identification for the program that serves as an umbrella for its campaigns;
- a reporting process that shares information on the successful use of the donations to meet the stated purpose (this can be in the form of a mini-Web site and use e-mail and social media); and
- Ongoing relationship engagement with microgiving donors.
Microgiving Programs Deliver More Than Microgifts
There are many reasons for a nonprofit organization to institute a microgiving program. The most obvious is donations brought in by specific microgiving campaigns. But there are more significant outcomes that grow out of microgiving programs.
- The more frequently someone gives to an organization, the more they feel an affinity for the organization and its work.
- The greater that affinity, the closer they are drawn to the organization.
- The closer they are drawn to an organization, the more likely they are to make a gift to the organization that is at the maximum range of their philanthropic capacity.
Microgiving programs offer a gateway for potential donors to engage at ever higher levels with an organization. Today's small giver has the opportunity over time to become a major donor.
- Microgiving programs work.
- Microgiving programs work best when they are presented to people who have been primed with an emotive appeal that creates within them an impulse to give.
- Microgiving programs are best executed through online mechanisms that provide the opportunity to respond to the impulse to give at the moment the impulse occurs.
- Microgiving programs should require one, two, or at most three clicks for a donor to complete.
- Microgiving programs require quick but high-quality planning. They should be able to be implemented in a day or two.
- Successful microgiving programs are often based more on the reason for the gift than the organization asking for the gift, but the organization's credibility supports the donor in carrying out the impulse to give.
- Microgiving programs are inexpensive to implement, but require a commitment to follow up and nurture relationships with those who give.
- Microgiving programs can be entryways for new donors to an organization.
- Established donors to an organization will respond to microgiving appeals, and those microgifts will be in addition to their normal annual giving.
- With thought, planning, and creativity, just about any organization can implement a microgiving program.
Joyce Braun Poderis
Tony Poderis is a veteran fundraising consultant who served as director of development for the Cleveland Orchestra for twenty years. He welcomes your comments at his Web site, Raise-funds.com.