by Troy Janisch

What a difference a few years makes. In 1999, charities had raised only $7 million via the Internet, and almost $2 million of that went to the American Red Cross. Last year, according to the Chronicle of Philanthropy, which now publishes a yearly tracking for this sector, revenues were up to $124.5 million.

Charities and their for-profit partners are getting more savvy about Internet fundraising.

In 2003, the Boys & Girls Club of Dane County and Trek Bicycles created “Trek for Kids,” an annual bike ride event in Madison to support the club’s efforts. To simply registration and reduce overhead, the event encouraged participants to register online and provided the capability for donors to contribute online on behalf of individual riders.

Lisa Beringer, development director for the Boys & Girls Club of Dane County, said the Club’s first attempt to use the Web to collect money was easier, and more successful, than anticipated. Nearly one-third of the individuals who preregistered for the event did so online, which made administering the event much easier. When people registered online, their rider information was automatically added to the participant database, their payment was deposited in the Club’s bank account, and the rider received immediate confirmation.

“It made the process much more streamlined when we didn’t have to deal with checks and enter the registration information manually,” Beringer said. “It also made it easier for event participants to collect pledges because they could send an email link to everyone and allow them to donate online – instead of having to collect and manage a pile of checks.”

“Trek for Kids” netted $50,000 for the Boys & Girls Club in 2003 and is will be repeated July 24, 2004.

Successful online fundraising requires more than a webmaster:

• Investment. Accepting credit cards online also requires an upfront investment in time, technology, and web infrastructure.

• Integration. Online fundraising is most effective when it’s one part of an effective web site. Web sites need to provide visitors with a meaningful experience beyond giving.

• Promotion. Online fundrasing begins offline. Capabilities need to be promoted by staff and aggressively integrated into the organization’s overall fundraising and marketing efforts. Email marketing strategies should be implemented to support and promote online fundraising efforts on an ongoing basis.
• Patience. The benefits of online fundraising may not be immediate. It often takes several months for online fundraising efforts to build awareness and momentum.

• Caution. A number of third-party “philanthropy portal” offer nonprofits a fast-track to receiving donations online. Many of these services turn out to be more expensive over time than implementing fundraising on your own site. One Internet fundraising company, PipeVine, recently folded in somewhat suspicious circumstances, leaving dozens of charities stranded and missing large sums that had been funneled through the organization.

• Imagination. Online fundraising is more than accepting credit cards. It can include managing charity events, selling merchandize with charity logos, “click and give” programs sponsored by local businesses.

Although web-based fundraising can save significant sums of money, only about 5 percent of the 200,000 largest nonprofits in the United States use the Web to solicit donations. And, e-commerce applications widespread in the for-profit world, such as customer databases, e-mail marketing and Web site traffic analysis, are less common among nonprofits.