In the past 10 years or so, digital fundraising has become an integral part of any successful fundraising operation for the majority of charities and non-profit organisations around the world. As part of this digital shift, a new method of digital fundraising has arisen; this is crowdfunding. Today, I will be talking about online crowdfunding for charities and non-profit organisations and how you can make the most of this innovative fundraising method.
What is online crowdfunding?
Online crowdfunding is a new method of digital fundraising that takes advantage of the ubiquity of social media and the Web in our daily lives. However, the term ‘crowdfunding’ is not new and research confirms that the term, (and the method) was used as far back as the 1700s. A notable incident that can confirm this was when London’s mercantile community saved the Bank of England in the 1730s. There was a run om the bank when customers demanded their pounds to be converted into gold—they supported the currency until confidence in the pound was restored, thus crowdfunding saved the bank.
In simple terms, online crowdfunding is using the Internet to fundraise from the crowd and the crowd could be your 1st, 2nd, 3rd degree connections or even beyond this!
The difference between online crowdfunding and digital fundraising is quite simple; online crowdfunding works for specific campaign within (usually) limited period of time and it is considered part of the digital fundraising strategy, whereas digital fundraising is most often a long-term strategy and part of income growth.
How do you plan your online crowdfunding campaign?
For charity and non-profits this might be tricky and the reason being, as a charity (and we will learn more in the subsequent paragraphs), you would not win the crowds’ emotion if you don’t show a level of urgency in your online crowdfunding campaign. However, with this urgency, you won’t have time to plan your ‘campaign’ so you have to prepare the basic tools for a successful campaign ahead of time. I will summarise this very briefly here for the sake of keeping this article as short as possible!
1- Identify your crowd and internal communication.
This is the first step and one of the most important ones; you have to understand that without getting everyone on your team to work together in this campaign you will most likely fail! So, form a workgroup for this urgent appeal from your team. You can also invite volunteers and interns when needed. Identify the roles for each team member and make their tasks clear.
Next, categorise your crowd on a personal style and group them out to make your next step easy and simple. Once you do this, you will be focused on the channels that will have the biggest impact on your campaign. For example, your crowd might be available in LinkedIn not in Facebook or vice versa.
2- Prepare your crowd online and offline.
If you think that by going to the online crowdfunding platforms you will have backers (donors) ready to back your campaign just because you have a compelling story then you are wrong!
You have to prepare your crowd online by simply publishing posts and stories about the cause you want to pitch in your online crowdfunding.
I would also suggest reaching out to your key partners and individuals by phone or meeting them face to face to inform them about the launch of the camping and securing their support before you go live.
3- Identify your funding goal.
I know, we all want to raise a lot of money for our urgent and compelling cause but we have to be realistic! Always have a few milestones for your campaigns and start with the lowest amount possible; you can always increase the funding goal once you have hit the first milestone.
In any case, don’t start the campaign with zero showing in your secured total; this is why I said you have to have work offline to initially secure at least 5% of the funding target before you launch.
4- The crowdfunding timeframe.
You should set a timeframe to reach your funding target. Otherwise, your donors and backers will not feel the sense of urgency of your campaign. Even if you think the timeframe is too short to be achievable; you have to set one!
5-Identify the online crowdfunding platform.
There are so many platforms to help organisations like yours launch online crowdfunding campaigns but are they are not all the same. A few considerations to keep in mind when choosing the platform or platforms you will use are:
- The service fee of the platform and payment processing fee. In addition to this, you have to know when you will receive the funds after completing the campaign.
- The possibility of transferring the secured fund even if the funding goal is not achieved.
- The functionality and facilities provided such as auto-response, access to the donor database etc.
- If you are in a region where 2 languages are usually used for professional communications, make sure the platform supports both these languages.
- Make sure the platform supports multiple currencies as you might have a lot of international backers and they may prefer to pay in their local currency.
- If the platform supports peer to peer fundraising.
6- The date and time of launching your crowdfunding campaign.
Avoid launching your crowdfunding campaign during the weekend, the first day of the week, early morning, or late evening. The best time is during the middle of the week and just before lunch break.
7- Retention Plan for your backers.
Your backers and crowd are your treasure; so make sure you take extra care of them, even if they contributed only a small amount of money to your campaign. I talked before about having a number of retention strategies, but I would suggest having the following as a minimum:
- Personalized thank you email.
- Handwritten thank you notes from the beneficiaries—if applicable and realistic.
- Asking their permission to add them to a mailing list related to the project they funded. This allows you to share updates on the project and also standard donor communications.
I want to conclude by saying it takes 3 to 5 months to plan and launch an effective online crowdfunding campaign. However, if you are a charity that supports relief work in areas hit by a storm or an earthquake you cannot wait this length of time! This simple and straightforward plan will allow you to launch your crowdfunding campaign in a matter of a couple of days. Finally, I would encourage you to take advantage of digital innovations, and be part of this digital transformation that aims to support the good work that your charity is doing.