The impact of technology on non-profits

Fundraisers and non-profit organisations are cautious when talking  about the impact of technology on fundraising. There is a shared view that mobile technology and the growth of giving websites have provided new avenues for charities to raise money. Yet the sector has not seen a significant rise in online giving. The Institute of Fundraising still puts the number of donations made online at 7-10%, just ahead of payroll giving, and still lagging behind donations made by cheque, credit card or direct debit. With the COVID-19 pandemic, technology is becoming even more omni-present in our day-to-day lives, including within the non-profit sector. Will technology be beneficial or detrimental to fundraising in these novel times?

Benefits:

• Streamlined donation process: Technology has streamlined the donation process and made it easier and more convenient for many donors to donate money. Technology has offered donors much more flexibility in terms of payment options, including seamless payment options like PayPal or Apple Pay. Donors now spend less time with the mechanics of ‘donating’ and more time ‘connecting’ with an organisation’s cause and work. This has improved donors’ experience, which is crucial for non-profits to develop long-lasting meaningful relationship with their supporters.
• ‘On the go’ fundraising: Digital fundraising tools have allowed charities to reach more supporters whilst spending less time and money. An organisation’s potential donor base now extends to anyone with internet access or a mobile phone, rather than being restricted to an organisation’s geographical boundaries, to a physical event’s guest lists, or a mailing list’s database. Technology allows individuals to support a charity from anywhere at any time, often from the comfort of their own homes.
• New platforms for younger generations: Technology has provided non-profits with new platforms to engage their donors, especially younger generations. Social media sites have become a forum for individuals and charities to share news, raise awareness and money. Virtual reality is also allowing organisations to connect with people in a more meaningful way. It offers a powerful tool for engagement, helping charities build emotive narratives to drive support. These new platforms respond to the need and expectations of a younger generation of donors who are more tech-savvy. This generation expects the same level of customer experience from their interactions with non-profits as they get from commercial brands–and desire immediate action.

Detriments:    

• Face to face interactions still matter: Technology can make fundraising feel cold and distant. Online fundraising tools provide non-profits with a quick and easy way to acquire new donors, but they are not always adequate for retaining and cultivating donors. Retaining and cultivating donors is better achieved through more traditional face to face interactions. Technology is not central to giving; storytelling, human connection and emotive narratives are. It is probably why large charities still generate the majority of their money from more traditional, physical fundraising activities, whether through face to face discussions with donors to the occasional sponsorship event such as marathons.
• Skills and capacity needed: To fully capitalise on the potential of technological tools, non-profits need to invest in digital skills. They have to build their digital capacity. Employees need to be trained and skills need to be transferred, websites need to be reviewed and new tools need to be purchased. This will require resources that not all non-profits have at their disposal. Smaller charities may not be able to invest in digital skills, which could create another gap between smaller and larger charities. Beyond digital skills, non-profits will need to develop new tools, new models and new principles to better engage with their donors, processes that are also time-consuming and resource-intensive.

Recommendations

Although technology provides new opportunities for non-profits, it will never fully replace face-to-face interactions or traditional fundraising methods. Nevertheless, new digital tools and technology are becoming the ‘norm’ and organisations need to make sure they make the most of it by:

• Investing in digital skills: You need the right people and the right skills. There has already been a cultural shift in the past three years to integrate digital teams across all fundraising disciplines. Embedding digital staff members into fundraising teams, or finding external digital champions, will enable non-profits to capitalise on the potential digital fundraising tools.
• Developing a digital strategy: Skills need to be transferred, websites need to be updated, and new technology needs to be assessed and tested. Organisations need a clear strategy on how they will embed digital processes within their organisation and when these processes and tools need to be updated. Otherwise, an organisation’s technology and tools could quickly become obsolete.
• Capturing and using data: We have previously talked about the importance of keeping clean donor database and using data to inform fundraising strategy. Online fundraising tools allow organisations to collect more data more efficiently, and to organise and store it more easily. Without capturing and using this data, organisations are fundraising in the dark.

If you are interested in learning more, please contact us at robin@theathenaadvisors.com.

Highlight Articles

• Amar, Z. How Charities Must Transform for the Digital Age, The Guardian. https://www.theguardian.com/voluntary-sector-network/2017/jul/31/charities-transform-digital-age
• Using Technology as a Fundraising Improvement not a Distraction, 2017. Guidestar Blog. https://trust.guidestar.org/using-technology-as-a-fundraising-improvement-not-a-distraction

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