There is a great new study out from Target Analysis Group and Donordigital (View the study in the related documents below) that provides fascinating data on Internet giving, based on research with 12 large nonprofit organizations. Read it all, but here are the highlights:
1.) Direct mail remains the largest source of revenue and online donors are still a small portion of overall donor files at most organizations. However, median cumulative growth in online donors has been 100% over three years, compared to 6% for offline (mostly direct mail). Online giving is growing, and fast. I'll add another sign of growth: online giving's share of overall giving for 9/11 was less than 20%; for the tsunami at the end of 2004 it was about one-third; for Katrina, it was about 50%.
2.) For most of the nonprofits in the study, more than half of online donors were NEW. The Internet is serving as an acquisition source for donors. For half of the organizations, online gifts accounted for 30% of their new revenue in 2006.
3.) Online donors are younger and wealthier than offline donors. In terms of age, though, it's important not to jump to the conclusion that they are very young. Online donors are exceptionally spread out by age, while offline donors are all clustered in the 65+ age group.
4.) Online donors give more than offline donors - $57 vs. $33. At Network for Good, our average donation is upwards of $100. This is a generous bunch.
5.) Online donors are slightly less loyal - they renew at lower rates than offline donors. It could be they are fickle - or it could be that we're not doing a good job in our sector at online cultivation. I'd argue the problem is the latter - as the next finding suggests.
6.) Online giving at most organizations is not well-integrated with direct marketing efforts-offline donors typically don't start giving online. But, the converse is not true. Many online givers gave through direct mail when they renewed. The consensus in the study was this was not so much because the donors liked giving through direct mail, but rather that was how they were solicited because the organizations didn't have an active online renewal strategy.
What does all this mean? If you want a younger donor file, you must go online. If you want to recruit new, potential donors, you must go online. And you need a very good online cultivation strategy once these folks do give online, so you can keep them. They are clearly worth it.