Online Tools Becoming Popular In Fundraising
An estimated 400 items are expected to go up for bid on Nov. 19 in this year's holiday auction, including trips, fine wines and other high-end items secured through businesses and private donors by Cal's rec staff. (A back-to-school auction held every August typically features 250 items, including game tickets, sports apparel and Bears memorabilia.) The holiday auction, which runs through Dec. 3 and benefits the majority of Cal's 35,000 students, university-sponsored children's day camps and alumni-related scholarship programs, will be powered by the cMarket Network (www.cmarket.com) — an online auction platform designed to help nonprofit organizations raise money. In fact, the "c" in the company's name stands for "cause."
"Why do we do the auctions?" asks Joe Watz, director of marketing and business development for Cal's Recreational Sports. "Because they build community within our community. Plus, this is an eco-friendly event that is safe, secure and provides an opportunity for a consumer to get great deals and help out an organization. The philanthropic residual is a great bonus for bidders."
In past auctions, some of those great deals have included a pair of $1,468 VIP passes to a Cal ballet performance that went for $470 and a two-night stay at a local luxury hotel that sold for half its estimated $410 value. Other items have gone for considerably more than their estimated value — such as an $85 stained-glass Tiffany-style lamp featuring the Cal logo, which garnered $420.
Watz says he's confident the online events are laying the groundwork for even more successful fundraising opportunities. "We're establishing some solid traditions with these auctions," he says. "They've provided us an opportunity to grow."
Many recreation, sports and fitness organizations are finding opportunities to grow via online fundraising — from auctions to reward and prize programs to Internet-based models of traditional fundraising.
"Online fundraising has reached the mainstream in a big way over the past four years," says Phil Noble, founder of Politics Online, a Charleston, S.C.-based company that provides Internet news, tools and strategies for governmental and nongovernmental organizations. He also developed, back in 1997, one of the first online fundraising mechanisms. "You don't hear people saying, 'I'm not going to use my credit card online' anymore. E-commerce has become pretty ubiquitous."
Noble considers the Indian Ocean tsunami in 2004 and the U.S. presidential campaigns in 2008 significant factors in increasing the general public's awareness and acceptance of online fundraising's possibilities. "About 30 percent of the American public donated in some way to tsunami relief, and about half of them did it online," he says, adding that Barack Obama's presidential campaign proved that requesting an online donation of as little as $5 can reap huge dividends. "Anybody who can send an e-mail can ask for a donation. Now, whether you're going to get one or not is a different issue. But sports provide wonderful opportunities because they foster communities, and anytime you have a community, you can appeal to people to donate money on behalf of a specific group."
Developing an online fundraiser is as easy as, well, Googling "online fundraiser." Google itself has a platform that can help nonprofits promote a cause, raise money and operate more efficiently (www.google.com/nonprofits). Here are some other options:
• Online Auctions. Despite the amount of work required on the part of the fundraising organization, online auctions are proving to be popular among groups large and small. While Cal Recreational Sports relies on its cMarket auctions to fund a majority of the department's budget, Calgary's Blizzard Bears youth soccer team partnered with local company Bazaario Inc. last year to raise more than $7,000 for travel expenses to a high-profile tournament in Sweden.
Bazaario's online auction site (www.bazaario.ca) is a cross between cMarket and eBay (which, incidentally, also offers a program for charity listings). Bazaario went live in 2006 and has about 3,000 members, all of whom could access the 50 or so items up for bid in the Bears' 10-day auction via regular navigation or a special banner created on Bazaario's home page. As with Cal's auctions, the Bears were responsible for soliciting the items up for bid. (Some charitable auction sites also help solicit such high-end items as tickets to sporting events and concerts, trips and fine dining.)
But unlike cMarket, which charges access fees to organizations and shaves off a small percentage of auction-sale revenues, Bazaario's auctions require no financial commitment from sponsoring organizations. Instead, the site is supported by banner ads and one-time $1 bidder-enrollment fees, says Niki Belcher, Bazaario's director of marketing.
Many organizations that once hosted live or silent auctions have made the switch to online auctions, according to Mike McInnis, vice president of marketing at Cambridge, Mass-based cMarket. A virtual event requires less effort and time than a live auction, which is also dependent on securing a venue and an auctioneer, providing food and beverage services, and even predicting weather patterns. "We've heard some really sad stories about live auctions that were crippled because of snowstorms and other weather-related situations that prevented people from attending the event," McInnis says.
Just as users of other e-commerce sites must use common sense to protect themselves against fraud, organizations that sponsor online auctions should beware of so-called phishing e-mails from would-be bidders attempting to acquire sensitive information such as user names, passwords and financial details. One of the most common tactics, Belcher says, is feigning interest in an item by claiming to be from a different country and asking the sponsoring organization for an address and bank account number to complete the transaction. "It must work, because people do it," she says. "That's the danger of the online world. These are not person-to-person transactions."
• Online Rewards and Prizes. In February, Challenger Sports Corp., which provides youth camps, clinics, tournaments, uniforms and coaching materials to soccer clubs throughout the United States, launched a partnership with the Margate, Fla.-based BSP Rewards online shoppers' loyalty program (www.bsprewards.com). Members of Challenger organizations encourage family members, friends and other supporters to shop in a specially customized virtual mall with 750 stores, where they can earn back between 8 and 18 percent of their purchases in reward points (each point equals $1). A percentage of that reward is passed on to Challenger, and shoppers also can donate all of their reward earnings to the organization.
"We don't necessarily sell this as a high-income stream," says Stefanie Kitzes, director of business development for BSP Rewards. "You're not going to make a whole lot of money from people shopping in a mall. But it is a value-added benefit. The theory behind it is that people involved with Challenger are shopping at these stores anyway. Even though they may have less money to spend in today's economy, there are still certain necessities they have to buy. And people are looking to save however they can. If they can save gas by shopping online, why not do that and also make money for the soccer programs?"
Challenger's challenge, Kitzes says, is spreading the word about BSP Rewards and its merchants, which include Target, Dick's Sporting Goods, Office Depot and Blockbuster. As part of a low-four-figure setup fee assessed to nonprofit fundraising groups, BSP provides marketing assistance via e-mails, web site postings and a toolbar that reroutes mall members from a virtual merchant's URL to the fundraising organization's specially branded BSP portal.
"It's really a process," Kitzes says. "A lot of these programs launch and don't see a lot of activity for three months. But once people get in there and see how it works, they realize the value and they start using it more. Rarely do you see a program like this where, from day one, it's off and running and everybody's happy and making money."
Other long-range fundraisers — ones that can last an entire NFL, NHL, NBA, MLB, PGA or collegiate sports season — are those sponsored by CharityMania! of San Jose, Calif. For $20 each, fundraising organizations sell "digital entertainment packages" that include a raffle ticket coinciding with a major sports season, and they keep more than 70 percent of the profits.
Each FootballMania! ticket, for example, contains three randomly selected NFL or collegiate teams for every week of the season. Winning tickets are determined based on the points scored by the designated teams during a given week. The four tickets with the highest cumulative team scores and the two tickets with the lowest cumulative team scores all win weekly prize money, ranging from $25 to $500. Each week, CharityMania! charts the winning tickets, posts the winners online at www.charitymania.com and sends prize money to the sponsoring organizations, which can then deliver it with a personalized message thanking winners for their support. Tickets in BaseballMania!, HockeyMania!, GolfMania! and HoopsMania! work in similar ways. Ticket holders also are entitled to music downloads from an online entertainment library.
• Traditional/Online Hybrids. Harold Tan spent four years as a UCLA student trying to raise money for various campus organizations by hosting bake sales and car washes. "What we found, after an entire day of selling cookies or washing cars, is that we'd only raised $200 — or $300, if we were lucky," he says. "I thought, 'There has to be a better way to do this.' There were a lot of opportunities out there; we just needed to get a little creative."
So in 2003, Tan founded FastTrack Fundraising (www.fasttrackfundraising.com), which provides the convenience of online ordering and selling with the proven success of the traditional face-to-face model. In addition to supplying organizations with such products as beef jerky, local merchant discount cards, scented candles and magnetic refrigerator picture frames that groups can sell the same way they did in the pre-Internet days, the company hosts online magazine sales, specially created donation-only web sites and credit card application pages from which the sponsoring organizations earn $15 for each approved application.
"It's a very familiar concept," Tan says. "The main advantages to doing it online are there are no geographic limits, it's safer than going door to door and it results in faster delivery."
Even traditional companies that still rely on the door-to-door tenacity of fundraising organizations have developed robust web sites from which groups can order products, exchange selling tips and plan multiple fundraisers. CharityCDs.com, which provides themed CDs featuring original recordings by well-known artists, streams music samplers on its site, and JustFundraising.com, which supplies organizations with everything from scratch cards to batteries, suggests which fundraisers work best for which types of organizations.
Regardless of how organizations raise money online, Noble says it's imperative that they continue to foster relationships with their donors year-round — not just e-mail them when they need money. "I think people should do whatever works, but fundraising must become a part of the ongoing conversation between the organization and the donor," he says. "Fundraising will just become a part of that larger online communication process. You have to involve them online. Ask them for advice. Ask them to connect your organization with other people. You don't always want to ask people for money. If you treat your community like an ATM machine, then eventually it's going to shut down on you."
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