There’s no doubting the power of text-to-donate fundraising campaigns. In the wake of the 2010 Haiti earthquake, individual donors contributed an estimated $43 million by texting via their mobile phones. If you’re a frontline fundraiser, it’s only a matter of time before your organization’s leadership and board approach you about investigating this source of revenue.
Before considering whether to implement a mobile fundraising text-to-donate campaign, here are 10 things you should consider:
1) It Takes Staff Time
Implementing a text-to-donate campaign takes more than deciding to do it and flipping a light switch to make it happen. Your development, marketing, and communications staff will have to spend some time making it happen. This may mean that other activities suffer, like stewardship and major gift cultivation.
2) New Donor Retention Rates Are Low
According to the Fundraising Effectiveness Project, the median donor retention rate for first-time donors is only 19%. That means that 81% of first-time donors will never give again.
One of the biggest arguments for text-to-donate campaigns is that it can bring in a high volume of new donors. It’s not necessarily a bad thing if you can keep your cost-per-acquisition low (more on that later). But, if you can’t keep those acquisition costs down, and those donors never give again, you may find that you’re spending more than you’re taking in. This problem compounds when you consider the cost of soliciting future gifts.
3) You’ll Need A Third-Party Vendor
In order to give donors the ability to text a donation code to a dedicated number (think: “text 10 to 90999 to donate $10”) and have that $10 added to their monthly wireless bill, you’ll need a third-party vendor to make that happen. This means more staff time in vetting and getting a provider up and running.
4) It Can Cost You Money
If you use a third-party vendor, you may incur set-up and transaction fees, not to mention any costs from the carrier (Sprint, Verizon, etc.)
When you factor in the cost of your staff’s time (and low donor retention), the campaign may result in negative ROI.
5) You Might Not Get Donor Information
If you’re using a third-party vendor, be sure you understand what you get from them. You may only get the revenue from the provider, and none of the donor information. If that’s the case, your ability to market to those donors again in the future will surely suffer.
If you do get the donor information, you have a new opportunity for segmenting future communications.
6) Gift Amounts Are Small
Text-to-donate campaigns typically solicit a small gift, usually between $1-$20. If you can promote the campaign digitally, the cost-per-acquisition will also likely be small. However, you run the risk of lowering your average gift size or cannibalizing gifts from annual donors.
7) Successful Text-To-Donate Campaigns Are Usually Reactive, Not Proactive
Most successful text-to-donate campaigns occur in response to a tragedy, like a hurricane, earthquake, or tsunami. The high awareness of those events can easily be capitalized on.
However, if you’re a nonprofit hoping to raise unrestricted funds apropos of nothing, a text-to-donate solicitation may not be as compelling to the donor as an “impulse” donation in the wake of a tragedy.
Try focusing your efforts on a stand-alone campaign with a tangible outcome.
8) Campaigns Are One-Dimensional
Because text-to-donate campaigns are often capped at a small gift amount, it turns into a volume game. This lends itself to a mass-marketing approach, which limits the amount of segmenting and personalization you can do in the ask. Such one-dimensional campaigns have the potential to alienate donors
9) There Might Be Better Ways To Leverage Mobile
It’s a mobile world, but is text-to-donate really the best way to leverage mobile or SMS communications? There are many other options available to nonprofits, including developing your own mobile app, optimizing donation forms for mobile devices, and pushing communications (not necessarily solicitations) directly to existing donors’ devices.
10) Copycat Scams Can Scare Donors
The rise of mobile giving has led to intrepid scammers who attempt to disguise their frauds as a charity campaign. Donors who are averse to electronic donations may cite security concerns as a reason for ignoring your campaign.
This post isn’t meant to discourage anyone from running a text-to-donate campaign. However, don’t succumb to shiny object syndrome and jump in without thinking it through. There is much to consider!
Has your nonprofit implemented a text-to-donate campaign? How’d it go? Let me know in the comments below!