Did the connection fail? The slow digital transformation of donations

 

Claire van Teunenbroek

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When did you last donate to an online donation campaign? Researchers at the ERNOP conference came to an astonishing conclusion: the digital transformation for the non-profit sector hasn’t happened yet, at least not in terms of donations. Sure, lots of charities use social media to promote their campaigns but a consistently small amount of online campaigns are successful in attraction donations: e.g 7 per cent in the Netherlands and 7.6 per cent in the US. Why are online campaigns unsuccessful? Most people immediately suggest that it is age related: older people give more[1] and this group is less active online. Charities cannot affect people’s age; therefore, we want to consider other causes hindering online donations. The lacking connection between donors and nonprofits in an online context is likely to be subject to several causes, such as: (1) no willingness to change, (2) donors do not trust digital systems, (3) information overload and (4) too abstract.

It might be an issue of path dependency: maybe both donors and nonprofits are reluctant to change. However, even when charities invest in online donation methods the success rate is low. For instance, at Kickstarter, one of the most popular crowdfunding platforms worldwide, the success rate as of April 2019 is about 37 per cent. Thus, about two thirds of the projects fail to assemble enough donations and this relatively new donation method has an old problem: ineffective solicitation. This suggests that even when nonprofits want to change and focus on online donation methods, donors are not biting. Charities are willing and need to change, since solicitation methods are less effective in attracting new donors and stimulating current donors to continue to give. However, from a donor’s perspective there is no clear need for change: the benefits from online donating are unclear for donors.

Why are donors reluctant to donate online? It is possible that donors don’t feel comfortable or don’t trust digital systems enough to donate to an online campaign. This is even more likely when people around them (i.e. peers/close ties) are reluctant as well. The reluctance is more likely with elderly donors (CAF, 2017), if none of their close others are donating online why should they? In this case informing people about the donations of others might be useful. For instance, when viewers of a crowdfunding platform were informed that other donors had donated as well by showing the average donation amount, more viewers decided to donate (van Teunenbroek & Bekkers, 2018). Thus, actively sharing that people are donating online could nudge others to give as well.

Maybe donors are overwhelmed by the fast number of online campaigns (i.e. information overload). For instance, while I am writing this blog, Kickstarter hosts about 3,700 projects. I can easily imagine donors feeling overwhelmed by the high need for help. Yet others say that it is not the number of campaigns, but the way they are distributed over the web. Most charities have their own site where they promote and ask for online donations. If this is indeed a reason behind the lacking online donations, then one central site or app could be a solution.

Finally, maybe the online donation context is too abstract. After all, technology is just a tool to motivate people to give, the solicitor is the most important. It is possible that people do not feel connected with the charity/project if the cause is only presented and thus transferred online. We know that video’s make online projects more effective[2], possibly by making the cause less abstract and more identifiable. It is advisable for charities to focus on ways to improve the personal connection with potential donors online.

In this blog I gave four suggestions to explain why online campaigns are ineffective. In general, the literature focuses on reasons to give, in this case it might be fruitful to also examine why people do not give to online campaigns. The motives of the non-givers could provide nonprofits with an idea of how to make online donation methods more attractive and/or suitable.

Claire van Teunenbroek MSc. is a PhD student and researcher at the Center for Philanthropic studies at the Vrije Universiteit Amsterdam.

The European Research Network On Philanthropy is an association of more than 250 academics aiming to advance philanthropy research in Europe. Learn more about their work by visiting the website http://www.ernop.eu and sign up to the quarterly newsletter.

Tagged in: #ERNOP2019


Footnotes

  1. ^ Bekkers, R. H. F. P., Schuyt, T. N. M., & Gouwenberg, B. M. (2017). Geven in Nederland 2017: Huishoudens, nalatenschappen, fondsen, bedrijven, goede doelenloterijen en vrijwilligers. Lenthe Publishers
  2. ^ Cha, J. (2017). Crowdfunding for Video Games: Factors that Influence the Success of and Capital Pledged for Campaigns. International Journal on Media Management, 19(3), 240-259.

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