How can you make sure you’re not missing out on donations?
Originally published: September 2017. | Last reviewed: April 2018.
How much cash do you have on you right now? Quite possibly, none at all: 34 percent of Americans and 21 percent of Europeans rarely or never carry notes or coins. Half of British adults have less than £5 with them at any time.
But while consumers embrace the cashless future, donation options at most charities remain limited, meaning cash is still king. Michelle Wright, founder and CEO of consultancy Cause4, says this means charities miss out on vital funds. Research has shown that one in seven people walk away from a potential donation because they don’t carry cash.
There are good reasons to accommodate such donors. First, they could be more generous: a study for Nationwide, according to Charity Digital News, showed that Brits give twice as much if using mobiles or cards to donate (an average of £5.47, compared to just £2.34 with cash). One small charity, Kids Club Kampala, uses PayPal card readers at fundraising events and U.K. director Olivia Barker White says this prompts people to give more: "They think more about how much they are donating rather than just finding some change in their purse."
Second, more cashless options could help win over younger generations, who are less likely to give than their parents or grandparents, but more likely to engage with a charity online. Nearly one in three young adults told Charities Aid Foundation they would donate via apps if the technology was there, while 35 percent said they would use contactless payments to give to charity if they had the option.
So what are some ways to catch up with a cashless society?
1) Optimize your website for online donations
Start by making your website donation route as user-friendly as possible.
"Too many charities make this long or unwieldy," says Wright. "Most online visitors aren’t keen to share lots of personal information or fill out forms, when a simple click on PayPal would do the trick." Make your 'donate now' button — which you can download from most online donation websites — easy to find, she adds. And provide options: suggest different amounts and remind users of the difference they can make by giving examples of what each will pay for.
New software as a service (SaaS) technology, already popular among small businesses selling online, is also making it easier for small charities to have a fully integrated donation facility on their website without needing much customization. It also avoids sending donors to a third-party provider, which is usually branded differently and incurs a fee, says Andy Pearson, managing director at web developers White Fuse, whereas SaaS offers "free or very low-cost setup options" and competitive ongoing subscription prices.
Whether paying third-party fees or investing in their own website, the costs can feel like a luxury for small charities. But it’s an essential way to "future-proof" the organization, Paul de Gregorio, director of digital engagement at Open Creates told MissionBox. "Irrespective of their size, organizations need to make sure their sites are beautiful and work extremely well, including on mobile," he says. "A very high proportion of donations are not completed because of a badly-designed process."
2) Enable donations on social media
Driving visitors to an organization’s website is challenging even for big-name brands, says Wright, so go where your potential donors are. That might be on social media. While Twitter’s #DONATE function requires a few steps before a donor can make one-click donations, Facebook’s Donate button is more straightforward. Available in the U.S. since 2015, it has just been rolled out in the EU — and de Gregorio says it’s a "phenomenal" opportunity.
"If you can fuse the sense of community with amazing content that inspires people to give, the potential is massive," he says. De Gregorio’s team managed the fundraising for a telethon in the U.S in early 2017 — one of the first to be broadcast live on Facebook Live and use Facebook Donate. They raised close to $280,000 via the new function in just a few hours.
There is a cost (Facebook charges a 5 percent fee on donations), but this shouldn't put small charities off. "You’re not having to invest in buying a technology," de Gregorio says. "And if you aren’t making it easy to give, your potential supporters may seek out an alternative organization to give to... I’d encourage organizations of any size who've got a Facebook presence to be the first with tools like these."
3) Try contactless collection boxes (or dogs, or windows)
As the popularity of contactless payments in the U.K. continues to soar — the total is expected to rise from 14.3 billion payments in 2016, to 21.9 billion in 2026 — charities are starting to respond. Pet welfare charity Blue Cross pioneered the first contactless fundraising dogs, Cancer Research UK has trialled tap-to-pay points in their shop windows and on park benches, and the Church of England began piloting contactless collections in 2017.
Results have been mixed. A Save the Children trial with contactless-enabled collection tins in 2015 found that given the choice, more than two-thirds of people still preferred to give cash than by card. In another multi-charity trial led by Barclaycard in 2016, Oxfam GB said it was great to offer the option, but that take-up was limited and cash was still ahead.
The technology and the payment processing also comes at a cost (though this is coming down) — but that may be offset by the higher amounts people seem to give. In the Barclaycard trial, NSPCC found that the average card donation was £3.07, while the average for those giving cash was £1. Barclaycard claims the technology could earn charities an extra £80 million a year.
"Small charities will find it harder to invest in the technology, but with the return on investment it certainly seems to make sense," says Wright.
Charities can now also add labels to existing collection boxes (or any other object — from a poster to a volunteer’s ID badge) that make them capable of accepting donations. Mobile tech firm Thyngs, which launched the product in 2017 together with Angal, a company that makes collection boxes for charities, says it’s much more cost-effective than many contactless boxes trialled so far: the technology can be added for as little as 60p per box (Thyngs takes a 2.5 percent fee on each donation plus any card-processing costs taken by payment processors). Currently the service also accepts donations via Apple Pay and PayPal.
So should charities everywhere be setting up contactless payment terminals?
"Most contactless payments don't capture any information about the donor. Charities want at least to be able to tell them what their donation is doing. So it’s not great for building mass movements," says de Gregorio. "We advocate using contactless in the right places — for example, at a big event — but strategically it’s usually better to focus on engagement that allows future contact."
Jonathan Cook, director at Insightful, agrees that charities need to offer contactless options at events or risk "losing a fortune" in possible donations; card readers that you link up to a tablet or smartphone cost only around £30. But it’s most powerful when presented at the right time and place, he says — like near the exit of a museum. "You’ve just been to a free exhibition and you’re thinking ‘that was great’. You’re in that philanthropic mindset, so it works really nicely," he says. Cook worked with the National Army Museum to introduce contactless terminals in 2017: donations have exceeded the target (1 percent of visitors) and are on track to cover the cost of the technology within four months.
4) Text/SMS donations
Text or SMS donations have huge potential: after the 2010 Haiti earthquake, they contributed an estimated $43 million to relief efforts.
The amounts tend to be small, but there’s evidence that people are open to spending more. In 2017, Comic Relief introduced a £20 option for text donations during its annual Red Nose Day fundraiser — these maximum donations alone totaled £5.4 million. The U.K.’s Phone-paid Services Authority (PSA) expects the value of donations by text message to grow by nearly £10 million in 2017/18, Third Sector reports, generating £124 million income.
About 60 percent of SMS donations came from fundraising phone-ins such as Red Nose Day in 2016-17, according to the PSA. But text-to-donate is a viable route for smaller charities too, says Cause4's Wright: "It’s relatively old, simple technology that has the potential to engage different groups and respond to specific events or campaigns."
The simplicity of texting is part of its appeal, agrees de Gregorio: the fundraising technologies or ideas that work are those built on existing behaviour, rather than requiring extra steps. "Sending a text is a very frictionless way of donating, you get phone out, type in a code and send. That’s super simple compared to going to a website, giving your name and address, making a Gift Aid declaration and so on." SMS is also a great way to keep in touch with supporters who opt in to communications: 90 percent of text messages are read within an hour of being received.
5) Charity apps
With people everywhere glued to their smartphones, it makes sense for fundraisers to find inventive ways to use them.
Among the best-known charity apps is Charity Miles, which tracks how far a phone’s owner walks or runs, and then donates accordingly to their chosen charity (over 30 are featured) through Apple Pay, PayPal or other means. The more recently-launched SnapDonate allows a smartphone camera to recognize charity logos, so that users can donate on the spot (currently the Android version can recognize the top 150 or so U.K. charities). Some organizations even design their own apps: the UN’s Share the Meal allows users to quickly donate $0.50 to feed a child for a day, with over 16 million meals paid for to date.
So should all charities be building apps? Website developer White Fuse says definitely not: mobile app downloads are decreasing overall, and building one is a huge job. While charity apps are an interesting way to engage people beyond the financial transaction, Pearson says they’re unlikely to be "as disruptive" as contactless technology.
6) Microgiving or small change schemes
Microgiving schemes enable low-value donations as part of transactions that consumers are already making. In some cases these cost nothing to the consumer: Give As You Live donates to U.K. charities when you shop online at major retailers via their website, while Charity Charge in the U.S. redirects credit card reward points to nonprofits. In others cases the consumer pays a small amount: Pennies and Donate the Change both allow shoppers to round up their bill by donating the extra to a good cause.
This form of giving has big potential when it’s easy for both customers and retailers, says Wright. It also seems popular among younger donors: almost one in three (29 percent) of under 35s have donated via small change initiatives, according to Charities Aid Foundation.
There are some drawbacks to microgiving schemes though. The "impersonal nature limits the emotional connection to a cause," says Wright, and choice can be limited, since partner retailers often determine the benefiting charities — likely to be larger organizations.
They’re not only for big name nonprofits, though. Give As You Live has worked with some 10,000 U.K. charities, including local ones. A similar scheme, EasyFundraising, has raised money for 100,000 good causes (not only registered charities). Kids Club Kampala says this is "an easy way" for others to bring in some cash.
"We haven't raised a huge amount (we usually get about £20 a month) but it doesn't really require any input from us," says the charity’s director, Barker White. "We probably could increase this though by pushing more people to sign up."