More people have turned to online fundraising in the past year than ever before, and the same will be true in 2021 and beyond. The internet has completely changed how we connect, conduct business, and find information, so it’s little wonder that it’s also become one of the most important (and effective) ways for nonprofits and individuals to raise money for their causes.
Whether you’re a nonprofit organization, school, church, social club, sporting team, or any other group, learning the basics of online fundraising can take you far.
At Snowball Fundraising, we equip fundraisers with online fundraising tools to help small and growing organizations get up and running quickly. That means we know what it takes to succeed online these days.
In this guide, we’ll walk you through some best practices for raising money online in 2021—just like the pros. Here, we’ll discuss:
- Online Fundraising for Nonprofits: The Basics
- Online Fundraising Platforms & Tools
- Online Fundraising Ideas to Raise More
- Marketing Your Online Fundraising Campaigns
Online Fundraising for Nonprofits: The Basics
Whether you’re a seasoned virtual fundraising expert or you’re looking to explore new digital strategies for the first time, it’s essential to start with the basics.
An Overview of Online Fundraising
2021 should continue to be a big year for online fundraising. Not only are we increasingly comfortable making transactions online and expressing ourselves through online engagement, but people are spending greater amounts of time online. Thus, online audiences are more engaged than ever and willing to financially support the causes, people, and projects that they care about—as long as the process is easy and convenient.
Consider these recent statistics for an idea of the bigger picture:
- The typical returning donor makes a second donation around 349 days after their first donation. However, 19% of donors return within the first 90 days. The second donation, or “Golden Donation,” is the one that means you’ve secured that donor’s long-term support.
- Overall online fundraising revenue has increased by 23% over the past year, up from 15%. Online fundraising represents a ton of money raised each year, but it’s important to remember that it’s just one piece of a much bigger puzzle.
- The total number of donors increased by 7.2% in the last year. Additionally, the donor retention rate rose 1.8%, with increases in new donors at 12.6%, repeat retained donors at 3.6% and recaptured donors at 15.7%. That said, it’s more important than ever that you work hard to develop engaging relationships with your donors or risk other causes grabbing their attention and support.
Even in an unpredictable economy, small- and mid-scale online donors are happy to give when you put in the time to develop meaningful relationships and create unique engagement opportunities for them. And online fundraising is a giving channel that continues to grow, even now!
Why You Should Prioritize Online Fundraising
It’s important to prioritize online fundraising in your overall efforts because that’s where the people are looking. If you’re fundraising for a broad cause and want support from anyone interested, you can reach a large national (or global) audience with digital tactics.
Simultaneously, the internet and social media also make it possible to specifically target smaller local audiences to donate to local projects and programs. This ability to reach tons of donors at once, or laser-focus on specific audiences, makes the internet an incredibly versatile fundraising outlet.
That means an online presence is a perfect solution for a wide variety of causes. Some of the most common reasons for fundraising online include:
- Collecting donations for a charitable mission or particular campaign for a nonprofit organization
- Raising support for a school, church, or community program
- Generating interest and initial funding for a personal project or initiative
- Seeking financial help from friends and neighbors for a personal issue such as unexpected medical costs
Nonprofit organizations (including schools, churches, or community groups) and individuals will need to fundraise online in slightly different ways. Still, the core strategies that each follows should generally be the same. This guide is geared towards group fundraising efforts for mission-focused purposes; individual fundraisers can surely collect valuable insights as well.
How to Get Started with Online Fundraising
To begin raising money online, you’ll need to learn the essentials and build out your virtual fundraising toolkit. This tactic will enable you to collect funds even as the rest of your strategy comes together.
Before getting started, it’s an excellent time to review the critical steps that go into planning any type of fundraiser:
- Define your needs. Why are you fundraising online? If it’s just because you want money, that’s not good enough, and it won’t inspire anyone to support you. What’s your nonprofit’s mission or the unique project that needs help getting off the ground?
- Review your software. What online fundraising tools do you already have? You might be starting from scratch, or you might already have a nice website and social media profile set up. If you start from the ground up, check out our list of top free fundraising software options to begin building out your toolkit.
- Understand your audience. Who is your target donor? What motivates them? What do they enjoy and care about? Have they engaged with your organization before, or are you seeking to garner new support from the get-go? Think about these questions early on in the process, as marketing and promoting your campaign is a huge part of succeeding with online fundraising.
- Set concrete goals. Establish a specific financial goal to work towards. Doing this now will help to keep your efforts focused down the line. You might outline additional purposes, such as to “reach X number of new donors,” but make sure your main one is set in stone first. If you’ve hosted a fundraiser before, it’s a good idea to look at your previously collected data to understand your primary starting point.
- Set a timeline. You’ll also need to set a hard deadline. When does your campaign end? How long will you have to fundraise once you’ve launched your efforts? Then, set benchmarks periodically leading up to the deadline. At those points, check in on your campaign’s progress and make any new adjustments or decisions as needed.
- Think about additional fundraising ideas. With the core structure of your online fundraising campaign established, take some time to consider which fundraising ideas or engagement opportunities to work with. Check out our complete directory, or jump down to some of our favorite online ideas below for some ideas to get started!
By following these core steps, you’ll set up your online fundraising project for success. Now, it’s important not to gloss over step #2, reviewing your software, so we’ll discuss more specifically the type of fundraising software that will bring success.
Online Fundraising Platforms & Tools You’ll Need
You can’t fundraise online without the right tools. Luckily, online fundraising platforms allow you to raise money by tapping into the site’s existing tools and infrastructure. These tend to be valuable resources for those exploring the vast world of online fundraising, as they provide quick and easy ways to collect online donations and plan elaborate campaign efforts. Let’s dive deeper into the available tools and how to select the right provider for your team:
Types of Online Fundraising Tools
Donation pages, fundraising platforms, ticketing tools, marketing software, and tools of this nature play crucial roles in a well-developed fundraising toolkit. However, all the choices can be overwhelming for newcomers, so it’s essential to cover your bases first.
The ability to accept donations online while you begin nailing down your full-fledged strategies will be critical. Here are a few types of online fundraising tools that can help you optimize your virtual efforts:
- Donation Page Software: Your online donation page will be the heart of your online fundraising strategy, and you’ll constantly be directing traffic to that resource. Therefore, make sure you create a well-designed, user-friendly donation page and form to collect maximal donations. Note: make sure to include an option to sign up for recurring contributions within your donation page!
- Text-to-Give Tools: Text-to-give software allows you to leverage a particular form of mobile giving where users text a predetermined keyword to your dedicated text-to-give phone number (i.e., text GIVE to (123) 456-7890). Then, the user will be automatically met with a simple mobile-friendly donation form to confirm their gift.
- Fundraising Event Software: Event software can incorporate many features, including ticketing and registration functionality beforehand and mobile bidding for fundraising auctions. These tools allow you to plan for a better event by providing more accurate headcounts and easy ticket sales.
- Donation Trackers: A donation tracker, or online fundraising thermometer, is a simple way to track fundraising progress, visualize goals, and better engage with your audience. This online tool can even update in real-time with every gift so that donors can see the physical impact of their contributions.
- Donor Management System: A donor management system, also known as a CRM, is a powerful software tool that collects, tracks, and analyzes supporter information to provide a wealth of invaluable data. Then, you can use that information to better target donors with your appeals and make informed decisions about fundraising goals.
Then, once you have a solid foundation of basic fundraising software, several other types of supplementary tools can help boost your fundraising efforts. For example, while a matching gifts database doesn’t collect online gifts itself, it simplifies donors’ journeys in their employer’s corporate giving programs, thus further supporting your organization. Similarly, you might invest in a suite of marketing tools to help promote your existing online fundraising efforts once you’ve established a campaign (more on that later).
How to Choose an Online Fundraising Platform
Several key elements go into any software buying decision. An online fundraising platform is no different! Consider the following areas with any possible platform and see how your top choices compare with one another:
- Functionality: This is typically located under the “features” section of a software provider’s website and can include critical functions like online donations, mobile giving, event and donor management, and even customer support. The greater the functionality, the better, although organizations starting with online fundraising can likely settle for limited features.
- Price: Online fundraising tools can range in price from free to thousands of dollars annually. Free choices can be great for newer organizations with limited budgets, although you’ll need to be willing to invest in a more comprehensive tool, or expansions of your free toolkit later on to get the most out of it.
- Growth potential: If you opt for a free or low-cost provider, make sure it can scale up alongside your organization. Otherwise, you risk outgrowing your software too quickly and having to make time- and resource-consuming upgrades.
- User experience: Make sure your online fundraising software is easy to use for your team members and your supporters. If your team has trouble getting your platform up and running, you’re likely to miss out on potential support, while if your donors find the giving process too difficult, they’re likely to quit before ever hitting submit.
Our favorite solution is our own Snowball suite of donation tools! This all-in-one platform encompasses all of the above functionality for nonprofits, churches, schools, and small groups to get up and running with online fundraising tools quickly and easily.
Online Fundraising Ideas to Raise More
There are tons of fundraising ideas out there to help your campaign stand out and collect a wide range of support. As you explore these ideas, think carefully about your organization’s needs and goals and which methods best suit each.
Consider a few of our favorite tried-and-true online fundraising ideas:
1. Online Donation Page
Using online donation software, set up a branded donation page for your campaign or project. Make sure to choose a donation tool that gives you plenty of customization options while also offering a streamlined experience for donors. Then, promote your donation page online via social media, email, your website, and offline with direct mail!
When your donation page doesn’t slow down your supporters at all, it’s the most direct way for them to engage with and support your cause online. It’s recommended to include suggested donation amounts within your form to provide a baseline for gifts and encourage larger contributions.
Crowdfunding is an efficient fundraising model that taps into social media’s power through a third-party online donation site. This unique type of fundraising platform streamlines the logistics while focusing on spreading the word and gathering support.
To get started, post your fundraiser on a dedicated crowdfunding website where users can see a variety of charitable projects and consider funding them. Then promote your crowdfunding campaign heavily on social media and ask supporters to share the page with their networks as well.
3. Pledge Campaigns
With an online pledge campaign, your supporters pledge to complete a donation to your cause by a specific date in the future rather than immediately on the spot. For specific projects or missions, this can be highly efficient for generating a lot of support quickly. Disaster relief is a good example, but pledge fundraising drives are flexible and can be adapted to various contexts (including your annual fund).
This online fundraising strategy is effective because it forces you to focus on making the process as fast and persuasive as possible to secure the most donations before losing your audience’s interest.
4. Virtual Events
With virtual fundraising events, nonprofits can engage their donors and allow them to get together and fundraise for a good cause. These are great options for organizations that seek to expand their reach beyond that which is possible with in-person events and provide increased accessibility for new supporters to get involved.
Virtual events are still a relatively new type of fundraiser, but they’ve recently exploded in popularity due to COVID and social distancing limitations on traditional fundraising events. They even allow supporters to develop a sense of community without leaving the comfort of their own homes and are simple to plan and host with the right tools.
5. Peer-to-Peer Fundraising
Peer-to-peer fundraising has become extremely popular among nonprofits. With this innovative online fundraising idea, you allow supporters to create their own personalized fundraising pages that they promote online and use to fundraise on your behalf. With an overarching campaign strategy and an exciting goal, virtual peer-to-peer fundraising is highly effective.
This online fundraising strategy is engaging for your supporters who take on a new role as fundraisers, allowing you to deepen your relationships with them. Even better, wider audiences will be more compelled to give your cause when a loved one is promoting it than by a generalized donation appeal from an organization they might never have heard of. It’s a win-win!
6. Advocacy Campaigns
Advocacy campaigns are built around specific current events, legislation, or controversies that generate public interest. These can include online petitions, call-a-legislator pushes, email campaigns, and more. These campaigns’ primary goal is not to raise money (although you could raise some donations) but instead to create change and increase public awareness of your cause.
Advocacy is a great way to raise your organization’s visibility and engage with passionate supporters. If you work around environmental, educational, or social issues, you could reach a substantial amount of new listeners with an advocacy campaign. Plus, new tools like advocacy apps have made it easier than ever to get started.
7. Merchandise Sales
Branded merchandise like t-shirts, mugs, buttons, and stickers have long been an easy way to raise money for various causes, and taking them online has opened up new possibilities. That means that nonprofits with strong brand identities can raise a lot through simple merchandise sale campaigns.
Whether it’s a hoodie, a tumbler, or now, a face mask, any merchandise gives supporters a physical token of your organization and its appreciation. This item functions as a stand-in for your mission, and if they’re emotionally invested in your cause, they’ll be thrilled to buy merchandise that reflects it. Be sure to create your merch designs with your organization’s logo and brand colors so that the items you sell can double as a marketing tool as well!
8. Digital Design Contests
One fundraiser that pairs well with a merchandise sale is a design contest. To get started, inform supporters that you’re hosting a digital design contest and accepting submissions for new logo designs for your nonprofit or a particular campaign. You might even charge a small admission fee for designs to be considered in the contest for an added revenue source.
Then, have your supporter base vote with their dollars on the best design, with the winning design being printed on your branded merchandise for sale (see above idea). Make sure to send the winner a free t-shirt or tumbler with their design!
9. Email Campaigns
An email campaign is one of the easiest online fundraisers you can host. All you need to get started is a mailing list of supporters, a well-written donation appeal template, and email automation software.
You can begin with a standard email template, but you want to make sure that your messages are tweaked and personalized to fit each recipient. For example, you’ll want to address donors by their preferred name and acknowledge your organization’s previous support. Then, be sure to conclude with an eye-catching call to action button that drives traffic towards your fully-optimized online donation page.
10. Viral Video Challenges
Do you remember the ALS ice bucket challenge? This trend took over the internet with thousands of individuals participating and raising millions for ALS research—and it’s still talked about nearly a decade later. Those are just a few benefits of hosting a viral video challenge for your online fundraiser.
But how do you get started? First, determine what the challenge will be. While the ALS Association challenged participants to dump ice-cold water on themselves, other possibilities include singing a song, doing a dance, answering a set of questions, or whatever else you can think of! The important part is that participants record themselves and post the videos to social media, make a small donation to your cause, and tag a few of their friends to “dare” them to do the same.
With any luck and a bit of social media strategy, your challenge will be viral (and profitable) in no time.
11. Social Media Campaign
Social media is largely becoming a popular fundraising tool for all sorts of causes. If you’ve never leveraged these types of platforms, you’re likely missing out on a ton of available support.
To get started with this idea, you’ll need to choose a specific platform. For example, Facebook and Instagram each have built-in fundraising tools, so you’ll need to determine which one will better appeal to your intended audience. Then, once you’ve launched your campaign on your social media site of choice, be sure to encourage your supporters to both contribute and share your fundraising page with their networks.
This type of online fundraiser has shown significant success thanks to the ease with which campaigns can be shared across pages, meaning you can get your mission in front of new potential supporters who might otherwise have never heard of it.
12. Online Raffles
An online raffle is an easy way to raise a ton of money for your cause, and it’s an exciting choice for supporters who have the chance to win a fun prize.
To get started, look for a software provider that allows you to sell virtual raffle tickets to your audience. Encourage supporters to buy a ticket (or more), then pull the winning numbers after a predetermined time.
For this type of fundraiser, prizes can range from smaller-scale gift baskets to luxury vacation packages or even a car! Or, there’s the 50/50 raffle, which is the simplest to pull off because it doesn’t even involve coordinating a prize. You’ll simply collect money from ticket sales to go towards a large jackpot. Then, once the raffle is over, the winner will collect half of the sum collected while your organization keeps the rest.
13. Seasonal or Holiday Item Sales
The holidays are a fantastic time to run a fundraiser because your supporters are likely in the giving spirit. For this online fundraising idea, simply set up a virtual storefront where donors can browse and purchase seasonal and holiday memorabilia such as wreaths, candles, ornaments, and more. Then, ship items to buyers and thank them for their support.
For best results, be sure to market this fundraiser several months ahead of the holidays so that supporters can get excited about your options. Even better, the items you sell can also function as great gifts for loved ones which can take some of the pressure off of holiday shopping!
14. Online Auctions
You’ve likely hosted (or attended) a charity fundraising auction in your life. An online auction is similar but takes place entirely in the virtual realm, increasing both reach and accessibility.
To get started, you’ll need a suite of virtual auction software that can help you set up your auction catalog, offer online and mobile bidding functionality, and streamline checkout and payment processes. Then, open up your auction and encourage participants to bid on the items that interest them.
15. Corporate Matching Gifts Drive
Corporate matching gifts are a fantastic yet severely underutilized way to make your online fundraising revenue go further. Thousands of companies offer matching gifts programs where they agree to match donations made by their employees to eligible nonprofit organizations—yet many of these individuals are unaware of these programs in place.
By hosting a matching gifts drive, you can encourage new and existing donors to research their eligibility and complete the necessary forms to request a matching gift. And with an online matching gift database, you can even embed an easy-to-use search tool in your donation form for donors to leverage when their engagement with your organization is at its highest.
Online fundraising ideas like these perform exceptionally well when engaging and leveraging opportunities that might otherwise be overlooked. Be sure to put your own creative, digital spin on the ideas that best suit your campaign, audience, and goals!
Marketing Your Online Fundraising Campaigns
Once you have your fundraising idea in mind, online fundraising is all about strategic marketing. After all, the internet is a vast place, so you have to make sure your campaign stands out in front of the right people. Follow these best practices to optimize your virtual fundraising promotional efforts:
Understand your target audience.
Understanding your target audience means asking yourself questions like:
- Who is most likely to be inspired to donate to your campaign?
- How do you best reach them online?
- What types of appeals are most effective with your particular supporters?
Your existing base of donors is the smartest place to start identifying your target audience. They’ve already proven their interest in your cause, and they’re likely to engage with your upcoming campaign. This is why keeping a nonprofit database is essential for smart, modern, online fundraising.
For individuals, think about who will support your goals. Your friends and family will likely be a good starting point. Then, encourage them to contribute financially and promote your fundraiser to spread your reach with every share effectively.
Identify the right outlets.
Once you know who will be most interested in donating to your cause or project, it’s time to think about where you’ll find them. For example, which social media sites are most popular with your target audience? Do you have a list of previous donors? Do you know which fundraising channels are most effective with which supporters?
For online fundraising, there are three critical digital outlets to keep in mind:
- Your website: Make sure your site provides plenty of information in a concise, easy-to-use layout. Prominently link to your donation page so that site users can easily contribute to your mission.
- Social media: Create engaging posts that encourage supporters to interact with and share your content. Again, be sure to link out to your donation page for easy access.
- Email: Use your lists of existing or previous donors to send out explainers and donation requests for upcoming campaigns. You can even use handy email templates, but be sure to tweak and personalize your message to each recipient.
The best part? You don’t have to choose just one outlet. A multichannel marketing campaign is designed to engage your audience in various places and then direct them all towards a central goal. In this case, you’ll use your social media posts, blog posts, email blasts, and more to generate traffic and direct it towards your online donation page.
For example, you might encourage your social media followers to sign up for your email newsletter, where you can then motivate them to contribute financially to your campaign. Explore this in-depth guide from the tech experts at DNL OmniMedia for more tips on how to pull off this type of multi-channel strategy.
Determine your KPIs.
KPIs, or key performance indicators, are the metrics you use to measure your marketing efforts’ success. Without them, it’s difficult to tell what works well and what doesn’t. Be sure you’re basing your next steps on data, not assumptions.
Typical fundraising and marketing KPIs include:
- The total amount of donations raised by the campaign
- The number of new donors acquired
- The number of previous donors retained
- Any web traffic generated
- The number of new email subscribers or social media followers
An easy way to do this is by making sure your online donation tools give you access to your fundraising data. It’s critical to provide yourself with a way to identify the techniques that directly contribute to your goals.
These days, it’s relatively simple to develop your professional-caliber marketing strategy using free or inexpensive tools. However, if your nonprofit is looking for a more comprehensive, enterprise-style marketing toolkit, it’s worth investing in software designed specifically for that purpose.
Online fundraising can unlock substantial new opportunities for your organization—but you have to know how to do it effectively. When you take the time to develop fundamental strategies (and back them up with the right tools), you and your team will be set for ongoing success. Good luck!
Check out these additional resources for more ideas and support:
- Recurring Donations: Building a Stronger Fundraising Model. Securing regular donations from supporters is the single best way to ensure your organization’s success! Learn more about these crucial gifts and how to target them with this guide.
- Mobile Giving | The Effective (And Actionable) Guide. How do you make your online fundraising as accessible as possible to the widest range of potential supporters? Incorporate mobile giving! Read up on mobile giving trends and how to make the most of this strategy for your nonprofit.
- Online Donation Platforms | What to Know & 12 Top Picks. Choosing the right donation platform is a big part of getting your team set up for effective online fundraising. Check out this list of our favorite software providers and what they can offer your organization.
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