With countless crowdfunding case studies and more and more organizations jumping into the giving day game, development and advancement leaders (and/or their organization’s boards) are wondering whether or not a crowdfunding event would work for their organization. With limited staff time and financial resources, and ongoing priorities (i.e. managing multiple campaigns and audiences; mission delivery), it can be difficult to decide whether or not investing in a giving day event would be worthwhile.
Below are three key questions to help you decide whether or not crowdfunding is right for you:
- Are we seeing stagnation/declining results on traditional offline and online fundraising campaigns? We’re not asking whether or not your online and offline fundraising campaigns have stopped growing; rather, are you seeing a decline in that growth rate/not seeing the kind of file-replenishing numbers you need? If you answered yes, then giving days may be right for your organization: not only do these events rejuvenate lapsed and stagnant donor files by offering an exciting new way to engage, they can also recruit new donors of all age groups—from millennials, to boomers, to matures. For some events, more than 60% of giving day donors have been completely new to the organization (see the 2014 Crowdfunding Donor Demographics ).
- Do we have funding needs for projects that have been on the back burner because they may not be of interest to our general file and/or because they are too specific for a general fundraising campaign? If so, peer-to-peer crowdfunding events that focus on raising funds for the specific project are a great way to target a specialized segment of your file and get the funds you need for the project to succeed. A great example of this might be an animal welfare organization that would like to purchase acreage for a horse habitat. Your general file might not care (they love puppies and kittens), and may prefer funds to be spent on the big shelters, but if you can identify your equine enthusiasts and ask them to fund a project specifically for the horses, you might just find yourselves the proud new owners of stable-ready land.
- Are technology and staff resources (or lack thereof) key barriers to considering a giving day or other crowdfunding event? It’s a truth of our industry that we must all do more with less. There are never enough hours in the day, dollars in the budget, or sufficient staff. This makes the mere thought of managing one more program or taking on the development of one more project seem like a mountain too high to climb. The barriers to entry for crowdfunding are significantly lower than for other traditional fundraising programs—there are no giant mail files to coordinate and print, no event staff (for most projects) that need to be “on the ground” coordinating thousands of walkers/runners, etc. and the technology is increasingly friendly for both donors and organizations. P2P and crowdfunding platforms like Kimbia, for example, require little time to set up and go live, offer flexibility and provide all the tools your supporters need to raise money on your behalf.
Does effective, successful crowdfunding require staff time and an investment in understanding a technology platform? Yes. However, for many, the ROI is significantly higher than for other direct marketing campaigns, and equally important, they open up a preferred fundraising channel for many of today’s (and tomorrow’s) donors.
The facts are in! Kimbia’s recently released report, Identifying the Crowdfunding Donor: 2014 Donor Demographics, proves that the adoption of giving day and crowdfunding events is accelerating in all nonprofit sectors; four times as many Kimbia customers benefited from these events in 2014 compared to 2013, with more than 19,000 nonprofits receiving donations. This rapid adoption is due to the fact that crowdfunding donors span all age groups, and that the majority of donors have high net worth, are highly educated and use multiple channels, making them ideal donors for stewardship. Additionally, individual events have drawn from 25% to 68% new or reactivated donors, and inspired major donors to give multi-million dollar donations.
The numbers don’t lie—crowdfunding is a viable source of new dollars and donors. You owe it to your cause to ask yourself these three key questions to find out if this proven fundraising model is right for your organization. Want to learn more? Contact Kimbia today!