Nonprofits should lean on automation tools to increase donations

Nonprofits should lean on automation tools to increase donations

Nonprofits have struggled at times to secure funds in recent years, largely because donor retention rates have been on the decline. As a result, some organizations are turning to innovative technologies - from social media to automation tools - to attract donations.

"These days people don't go door to door anymore," Doug Haslam, a social media consultant from Newton, Massachusetts, recently told Reuters. "To raise money, you have to go outside your own neighborhood. That's why I turned to Twitter and Facebook instead."

Haslam has employed a method called peer-to-peer fundraising, during which he tries to raise money by spreading the word through social media. A recent Blackbaud study found that nonprofits that use social networking sites have been able to raise 40 percent more than organizations that use traditional methods, according to the news source, while peer-to-peer fundraising revenue has exploded to nearly $2 billion in the past five years.

"Now, with tools on Facebook and PayPal and mobile apps, people can go out there and effectively solicit their networks," Aaron Zifkin, senior vice president of Artez Interactive, told Reuters.

Multichannel donations could be way of the future
Low retention rates, among other issues, likely comprise one of the factors causing traditional fundraising strategies to fail.

According to a Target Analytics and Blackbaud report, 10 percent of all donations in 2010 were made online, compared to 7 percent in 2007. For new donors, meanwhile, online funding jumped from 9 percent in 2007 to 16 percent in 2010.

More than anything, however, the discrepancy between new online and mail donations among the younger generations is stark. Four times as many donations from 25 to 34-year-olds were made via the web, while people from 35 to 54-years-old contributed more than twice as much.

A recent Blackbaud report emphasized that nonprofit organizations should utilize new technologies going forward.

“With the evolution of mobile, social and cloud-based technologies, organizations can interact in very meaningful ways with both supporters and beneficiaries around the world," said Marc Chardon, president and CEO of Blackbaud. "And the increased efficiency will ensure greater delivery of missions in real time."

From mobile applications and cloud computing to big data analytics, innovations are out there that are affordable to organizations with varying budgets. In addition, nonprofits may want to adopt gift invoice automation software, some of which is available for mobile devices, to improve efficiency when collecting donations.