Special Report: Innovative Fundraising Ideas Bring in Cash For Bold Organizations

April 1, 2001       Clint Carpenter      

What sounds like a creative way for corporations to improve their image isn’t always the brainchild of a for-profit company. And when an innovative idea comes from the nonprofit sector, it can lead to relationships that help its mission, and even those of other organizations.

Kathleen E. Nixon, director of marketing alliances with the Washington, D.C.-based World Wildlife Fund, approached Netcentives Inc., a relationship marketing company based in San Francisco, with the idea of a click-through award of frequent flyer miles for dollars donated. WWF’s program, "Miles for the Wild" was launched in April, 1999, Nixon said, raising $23,000, enabling donors to receive two ClickMiles per dollar raised.

The program is called ClickRewards, and the miles received are known as ClickMiles. Donors make a gift, and an outside company lets them know it is approved. "We felt at the time that it was risky," Nixon said. "But we were comfortable with the ClickRewards program at that time and still are."

In 2000, the program achieved substantially more success and attracted high average gifts, bringing in $465,000 in online contributions. A major contributor gave $400,000 in one-to-one matching contributions for the 86 percent of all donations that were $200 or more.

The ClickRewards for this five-week campaign ranged from five ClickMiles per dollar for donations up to $200; $200-$500 donations secured 10 ClickMiles per dollar; $500-$5,000 donations received 20 ClickMiles per dollar; and donations over $5,000 got 25 Click Miles per dollar. In addition, Netcentives doubled the ClickMiles amounts, Nixon said, augmenting the program even more.

Netcentives provided online service free the first go-around but charged 3 cents per $1 raised on the second campaign. "We’re paying the premium, so it costs more," Nixon said. "(But) if you take away the tote-bag or the T-shirt (of other programs) do you still have the donor?"

In addition to the premium it pays, the nonprofit needs to keep the campaign fresh, so donors don’t see the same thing repeatedly online. "(ClickMiles is) an interesting way of attracting a new kind of donor," Nixon said. "As you do it, enhance (the campaign) each time because if you don’t donors will not be interested."

Despite WWF’s role in developing the program, it is not the only organization reaping the benefits. The Marine Toys for Tots Foundation in Quantico, Va., has collected more than $200,000 in online donations during the past two years through a similar online campaign with Netcentives. Donors add frequent flyer miles to an existing account, or open one up free of charge by giving to the cause.

The two joined forces in 1999, displaying only a donation button, which garnered $70,000 in online donations. The strategy changed in 2000, doubling donations to $140,000 by soliciting the approximately 400 people who gave in 1999, along with the roughly five million names in Netcentives’ database, said Major Bill Grein, vice president of marketing and development for Toys for Tots.

"We have not analyzed 2000 yet," Grein said of the final results. "We do not get a lot of online hits from January to July," he added, "but the bottom line is that the amount doubled from last year."

In the Toys for Tots ClickMiles incentive program, for donations under $50 donors received one ClickMile for every dollar; donations of $50-$199 donors racked-up four ClickMiles for every dollar; donations of $200-$499 received eight ClickMiles for every dollar; and donations of $500 or more garnered 12 ClickMiles per dollar.

The program started at the beginning of November 2000 and ran through the first week of January, said Grein, who described a premium relationship essentially the same as WWF’s in 2000. Grein said the organization hoped to raise $25,000 in 1999. "It was great," he said of the results. "We got $70,000 and we were ecstatic."

According to Grein, corporate sponsors, Visa and EToys also displayed donation buttons during the 2000 holiday season on their Web sites — raising an additional $36,000 online, bringing the organization’s grand total to $176,000.

The average donation online ($40) is more than double what its traditional direct mail campaigns usually muster ($18-$19) and reaches a different donor base in the process, Grein said.

Though Grein was pleased with the experience, he keeps a realistic outlook for its future. "This is really our fourth or fifth way to fundraise," he said. "We’ll probably reach a point when there will be a drop off."

A Web site can also be exploited for its power as a direct marketing tool. What World Vision has done, however, is market services and items that will go directly to a needy recipient, as opposed to a donor’s potential next garage sale.

"We try to cover all our programs in the online catalog where you are giving a gift to a stranger on behalf of someone you designate," said John Jensen, director of promotional marketing for the Federal Way, Wash., organization. Between telephone and online orders, the catalog at www.worldvisiongifts.org raised $1.6 million during the Christmas 2000 season – a fourfold increase of the $400,000 netted during the first year of the online shopping venue in 1999.

"We create the annual catalog program in spring so we can launch it in fall for the entire year," Jensen said. "We do insert special offers during individual holidays for additional giving. We had 37 items this year and may be up to 40 next year, and try to match the gifts with things people care about, such as children, medicine, education, or dairy goats."

The year 2000 saw 1,500 orphans in Burundi, Rwanda and Uganda given dairy goats, a $50 item, from which these "child-headed households" receive butter, cheese, milk, and yogurt, as well as a source of income. Another item, said Jensen, "is $30 for 1,000 tree seedlings that will create a fast-growing tree forest in Burundi to produce lumber for schools and homes."

The Cabrini Mission Foundation in New York City has implemented two successful online fundraising campaigns that have raised $160,000 for the battle against the spread of HIV/AIDS in Swaziland, Africa and for their medical center.

Through their partnership with New York City-based Changingourworld.com, and a $100 million commitment from Bristol-Myers Squibb Co., an iCampaign was launched in the spring of 2000 that raised $110,000 in online and offline donations for its Secure The Future program in Swaziland.

The second iCampaign has resulted in $50,000 in contributions for the Cabrini Medical Center, said Sister Lucille Souza, chairperson of the Cabrini Mission Foundation. "The idea was to use the Internet and read about the plight of the Cabrini Medical Center," she said. "It has been quite a success."

The Internet led both campaigns, but nary a solicitation email was sent. According to Souza, the site is informational, and people have the opportunity to give to either cause. "For us it really is a wonderful thing," said Souza. "They do all the work for me. I can’t lose."

Changingourworld.com has only been in existence for eight months, said Michael Hoffman, chairman of Changing Our World Inc., the organization’s parent fundraising company. But it has been a fundraising consultant of the Cabrini Mission Foundation for two years.

All online transactions handled by Changingourworld.com are free of charge, at least for now, Hoffman noted. And Souza has preference on what messages appear on the site. The actual cost for an iCampaign is $3,000, Hoffman said.

Some $8,000 has been raised through online credit card donations; $5,000 has been pledged through the Internet and the rest of the money has come in through offline donations due to the online awareness for the Secure The Future Program.

"Right now they’re doing it for free. We’re getting the entire donation. They’re not taking anything," Souza said. "We do realize that may not happen down the line."

Nationally respected radio personality and Chicago public radio icon Ira Glass helped nonprofit radio station WBEZ raise $135,000 in only three days during its first-ever online pledge drive.

According to Betsy Harman, director of annual operating support for WBEZ, $30,000 in contributions during the pledge drive directly resulted from an email signed by the radio show host of "This American Life."

The email message was sent to 7,000 people in the station’s email database, and Harman said 800 people responded and clicked through to the pledge drive page with 230 actually giving as a result of the email.

"For us, we knew there was a high percentage of Internet use (among our donors)," said Harman. "We knew that our demographic were Internet-savvy people."

WBEZ has had a Web presence for a year and collected $370,000 in online contributions during FY 2000. But having their first online pledge drive has sparked $304,000 in total online gifts already in FY 2001, said Harman, who added that the station had recorded 1,200 pledges with an average gift of $112.50.

During the three-day pledge drive, only 55 minutes in on-air promotions were used — normally 20 minutes is devoted per hour to promote traditional pledge drives. Although traditional pledge drives garner more money, they last eight to 10 days, and Harman said the plan is to have two each year.

Moreover, banner ads were purchased for the three days on ChicagoTribune.com for $3,000. That, plus the $300 outlay for the email messages kept overhead low.

Harman believes online fundraising has a great future, though she offered this caveat: "I caution other nonprofits because public broadcasting has a unique way to drive people to the site that others (don’t have)."

The National Arbor Day Foundation began an awareness campaign Jan. 1 in which visitors log on and vote to name a national tree. That month membership increased by 2,023, generating $20,230 from online membership fees, said Gary Brienzo, information coordinator of the Lincoln, Neb.-based nonprofit. "That has to be directly related to the vote," he said.

According to Brienzo, the organization usually averages 700 to 1,000 new members per month, so the new campaign more than doubled its output in January alone. Membership increased 4,042 in April, 2000, but Brienzo said it was due to Arbor Day falling on the last Friday of the month.

The organization drew eyes to its Web site (www.arborday.org) through direct mailings sent in late December 2000, together with a series of public service ads in Parade magazine.

"Traffic increased fourfold from the preceding week," Brienzo said. of the first week performance of the campaign. "Awareness was the thrust of the campaign, (however) membership has increased (during the campaign)."

The campaign will continue through April 26, the day before Arbor Day.

Fundraising isn’t always about money. In-kind giving has become an increasingly important aspect of many organizations’ bottom lines. But the trick can be when an item doesn’t exactly fit what the organization does or needs.

Sean Milliken is president and CEO of MissionFish in Arlington, Va., but he has a nonprofit, development director’s background. He said he developed the Web-based company because he didn’t like having to turn donors away. "When I was a development executive at the Boys and Girls Club of Metro Atlanta, I had been frustrated by the limited choices I could give to donors, whose in-kind goods sometimes did not meet the needs of the kids," he said. "So, I found myself trying not to seem ungrateful, but there was an inordinate amount of time trying to accept and process these goods that could not be used."

Recognizing that other nonprofits had similar challenges, he used his access to unique items, "such as airline tickets, signed memorabilia, and golf packages. However, I did get back pennies on the dollar for them in silent and live auctions at special events – because my audience was limited and were usually not there to purchase the goods but rather to celebrate the kids’ accomplishments."

MissionFish is different from an online auction in that it links buyers with donors. "(We) are establishing a mechanism for the nonprofit whereby they can accept what the donor is giving and if they can use it – or, what they wish to do with it," Milliken explained. "If they can’t use it, the item is placed out on auction."

According to Milliken, 81 nonprofits have become members of MissionFish, which launched this past October, after many dot-coms had discontinued their focus on the nonprofit arena. "We charge the buyer a 10 percent premium on top of the highest bid price, to cover the costs of the auction and the overhead," Milliken said of the pricing structure.

Robert Goodwin, president and CEO of the Points of Light Foundation, said MissionFish put in-kind giving in a more accessible light. "We are an enthusiastic member of MissionFish, because they are active in the creative sea of change in funding for nonprofits," he said. "Donating items, small or large, can be like volunteering your time — something we can all do that doesn’t cost a great deal — though collectively it makes a tremendous difference for others."

For First Book, like POL, based in Washington, D.C., the supplier of free books for community literacy programs found MissionFish to be a simple way to turn donated goods into a revenue stream, said Chandler Arnold, manager of communications and marketing. "Prior to our partnership with Mission Fish, First Book generally considered an in-kind gift to be an unkind gift," he said. "With the exception of books donated by our publishing partners, First Book was simply not able to use these gifts to advance our central mission."

The mail has been good to the Colonial Williamsburg Foundation. Colin G. Campbell said the Williamsburg, Va., organization has seen fundraising increase over the past three years because it has renewed its direct mail and other prospecting efforts.

"We had 79,000 donors in 1999 and 87,000 in 2000," said Campbell, noting that 21,000 of them were new donors in 2000. "This is not an anomaly … we hope."

So what fancy direct mail piece or other solicitation added more donors? Nothing too fancy, just a more extensive mailing list used over the past three years resulting in increased fundraising revenue. "Letters from the president," Campbell said.

Although the foundation has many high net worth donors, there is a substantial amount at the $100 or less level, he explained. "We didn’t focus on acquisition (before the recent efforts)."

Campbell noted that building strong relationships with donors can’t be forgotten. In December, Colonial Williamsburg received $15 million for educational programs from William and Gretchen Kimball, long-time supporters from Belevedere, Calif.

The fun of dressing up and going out appeals to almost everyone, and one county-wide women’s resource center is seeking to capitalize on that desire.

Somerville, N.J.-based Women’s Health & Counseling Center recently held its second annual "Reigning Women Ball" that raised more than $195,000 with a movie-set atmosphere – albeit at Merck & Co., Inc. world headquarters – and a theme of "Cleopatra: Egypt’s Last Pharaoh."

Said Kristen Cantwell, WHCC’s executive director, "We were looking for a special event that could help build our base of supporters both from a donor perspective and from a public relations perspective. Our guiding principle is to adhere to basic fundraising guidelines and allow all levels of volunteers to work on our projects — to bring people in to help in the ongoing events and then let these people bring with them their friends and business associates. We hope that with each person we can build off of this expanding base and continue to grow."

Cantwell said that in addition to raising money and awareness, the organization uses the event to diversify its membership both in terms of its geographic and economic bases. "Our Somerset, N.J., area is often mistaken as a homogenous upscale region, which is a part of it but not the whole story."

WHCC also ran a spring event in 2000, the Spring Fancy Garden Party, which appealed to a larger number of people, according to Cantwell. She said the Spring Fancy raised about $36,000, but she anticipates it could grow to $50,000 this coming year.

"We find that regardless of the economic or cultural background of any of our attendees, the lure of ‘dressing up’ and going to be part of an event is very exciting and creates the atmosphere of the event, just like a costume ball," Cantwell maintained. "It instantly creates an instant atmosphere which is so important for the success of the event. The downside is that it takes time and effort to produce these events–taking limited resources away from our day-to-day mission in the short term."

Cantwell mentioned that as these events grow and are more successful, the WHCC has been able to hire a part-time special event manager, which has reduced her personal time commitment to these projects.

The American Cancer Society is hoping the production of a retail-distributed music CD may prove fiscally beneficial. With a goal of raising $3 million, "Music of Hope," produced by Matt Singer, is a new 10-track collection of popular and classical music released in February.

With performances and conducting efforts by such artists as Paul McCartney, Ray Charles, Billy Joel, Andre Previn, Kurt Masur, the New York Philharmonic and the London Symphony Orchestra, the organization is hoping to capitalize on proven stars. "We had dabbled in similar music project ideas before, but when Mr. Singer approached us with his proposal, the great and exciting lineup of participants, and his track record, we decided to get with it," said Joann Schellenbach, national director of media relations at ACS.

"Part of the power of this group of performers is that all of them has had some personal relationship to cancer," she said. "While Paul McCartney – who lost his wife Linda to breast cancer in 1998 – is a relationship to cancer most people are aware of, the other artists on the CD also have personal cancer stories in their lives."

Another part of the power is that ACS will receive 100 percent of sales, including the artists’ royalties, according to Schellenbach.

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