Text Message Fundraising, Whoa Nelly!
Online Fundraising 1 Comment
It is undeniable that text messaging has become one of the most popular and efficient ways to communicate, particularly with the technology-dependent Generation Y. But while sending a text message to a friend might be the easiest thing in the world for cell-phone savvy individuals—is it the easiest way for non-profits to collect donations? It’s a growing opportunity for these organizations, but whether it is as efficient as they hope is still in question.
Despite the American Red Cross’ incredible success in raising over $18 million within the first three days of its text message fundraising campaign for Haiti, non-profits should think twice before lunging into this type of fundraising. This is partially due to the high costs of running this type of campaign, which, though it offers a simple way to give, is a complex process for the non-profit. This is mostly due to the fact that in order to run a text-message-to-donate campaign, in addition to the cell phone carrier, a third party needs to be involved. Mobile Accord/mGive Foundation was this third party in the ARC Haiti campaign, but with an estimated 5-10% of raised money going to the wireless partners, teaming up with companies like can be very costly and might not be worth it for smaller organizations.
What these text message vendors do primarily is vet the non-profit, confirming that they are meeting the charitable solicitation registration requirements. They set up short codes (the number a donator would text to give— such as ARC’s 90999) and assist in marketing. They often have a minimum revenue requirement too. Non-profits should also know that the maximum donation through text messaging is capped at $10, which is lower than an average online donation. If non-profits are determined to get their organization out there via cell phones, they should consider using text messages to release news, such as about volunteer opportunities or internal developments, which will at least draw attention to the organization. In a case study conducted by Mobile Commons, Watershed Company and The Humane Society of the United States, the results revealed that while sending out a text message requesting for call-in and reply-back donations pretty much failed, they did receive a 77% increase in online donations, proving that while text message fundraising might not be the best method to actually make a profit, it can result in other forms of donations as reminders to advocates.
In a live discussion hosted by “The Chronicle of Philanthropy,” Zoetica’s chief marketing officer Geoff Livingston suggested that non-profits should have at least a solid 100,000 member “fan base” that they will initially send the text message to, otherwise non-profits are at a higher risk of not raising enough money. With the carriers also making a profit (though these fees were waived for the Haiti event), distribution of money should be thoroughly thought out before the campaign process is executed. This is definitely something smaller non-profits need to take into account. In fact, Livingston basically dissuades small non-profits from using this campaign method all together, stating that it is primarily beneficial for large non-profits, such as the American Red Cross or John Edward’s 2007 political campaign.
This brings up the next difficulty with text message fundraising, which is that the third party carriers who provide the SMS (Short Message Service, A.K.A text message) marketing often require an appeal and proof of legitimacy from the non-profit, which may involve getting a distinguished organization to back the campaign, which in ARC’s case, was the US State Department. These companies want to ensure that the money donated will go to the actual charity. In addition to often requiring a 4th party to legitimize the organization, non-profits should also keep in mind that text message donations will not usually come flooding in unless there is an event of some sort to draw their attention to the cause. This “event” can be some type request made by a celebrity, a concert, or, unfortunately, a natural disaster. In a survey conducted by Convio and Sea Change Strategies, 36% of the participants said that they would be willing to donate via text message if an emergency took place, while only 28% percent would be willing for charity fundraising. It is unlikely for donators to choose text messaging as their primary means of donating regularly.
Another main drawback with receiving donations through text message is that the non-profit does not actually get any information about the donor. Collecting contact information and building up their database about advocates has always been an important element in campaigning for nonprofits, and when someone texts in a donation, the money is added to their phone bill, which the phone company then relays to the non-profit some 30-90 days after the donation pledge is made, giving the non-profit no way to contact the donor. Without this information, thanking the donors, requesting future donations, as well as sending out updates on the non-profit’s progress, is near impossible.
While text message campaigning has helped many larger nonprofits receive donations, it might be safer for smaller ones to stay a step behind, technology-wise. Establishing an attractive and easy-to-use website should be a top priority if technologically branching out is something the non-profit would like to pursue. While text message fundraising is something that might collect more donations from a younger crowd, the internet is accessible and easier to use for a wider range of potential.
Great story! I am on the same page with you when it comes to the costs of doing business with a third party to college $10 donations on your bill. The marketing company I work for has a solution. Tattle Texts uses a similar concept to collect donations but does not charge bills. We understand the importance of the donor’s information so we capture everything. Try it, text “Donate” to 74455. It’s a demo set up to show how we can capture donation pledge amounts along with the donors cell phone number. The organization can call the donor and arrange payment. At any time, the organization can export an excel spreadsheet with all the donors information, giving them all the data to continue to grow their database of donors.
I hope this helps to reassure organizations that there is an alternate to the traditional text messaging fundraising :)