Mobile Giving: The Next Revolution

The next revolution in fundraising will not be transformational. It will be transactional. And it’s arriving sooner that you think.

Last week, I paid a 65-year-old cab driver and, as usual, handed him my credit card. What happened next was unusual. The cabbie swiped my card though a Square payment device attached to his iPad, texted the receipt to my cell phone and updated the payment instantly in the taxi co-op’s financial systems. The entire transaction lasted about 10 seconds.

This took place not in Midtown Manhattan, but in America’s heartland — Madison, Wis.

The ease of making transactions with mobile devices in the service and retail sectors will soon become commonplace in our arena, the philanthropic sector. As a result, the last major hurdles facing fundraisers wanting to raise small dollar amounts from thousands of donors — return on investment and the cost of transactions — will be shattered.

And fundraising will never be the same. Imagine:

• A 15-year-old girl who jumps rope for five hours to raise money for the American Heart Association no longer needs to cajole her friends’ parents for their donation checks. She attaches her Square card reader to the audio jack of her iPhone and — instantly — the donations are registered at the association’s headquarters in Dallas and receipts are sent to the donors electronically.
• A development officer with an international NGO plays a round of golf with a corporate executive interested in helping bring clean water to a poor community in Tanzania. Over lunch in the clubhouse, the executive agrees to a five-year commitment of $50,000 and hands his golf partner a credit card. Barely 20 seconds later, the first $10,000 donation is recorded on a handheld device, and dates are set for the remaining four payments.
• A Red Cross volunteer working the aisles during intermission at a benefit rock concert meets an individual who has Square Register, an app on his mobile device. In the time it takes to type “Red Cross” and a few other key pieces of information, the charity receives a one-time $100 donation.

The financial burdens all nonprofits face — overhead and fundraising costs — could soon diminish significantly. Rather than spending 25 cents to 50 cents or more to raise one dollar, many charities, especially those engaging volunteers effectively, will spend 3 cents to 5 cents.

The ease and convenience of using mobile technology — combined with the extraordinary communications and networking potential of social media — will enable small nonprofits to engage potential donors and grow their revenues at a pace never before experienced.

Charity: water is a model for such engagement. The organization enables supporters to download Web banners and create individual fundraising campaigns and other activities. By hosting an event in their homes, the charity’s supporters — armed with mobile technology — could raise several thousands of dollars from a few credit card swipes and further its brand with new ambassadors devoted to the cause of bringing clean water to poor communities. Any “Doubting Thomases” to my assertions on the new revolution?

The Pew Research Center’s Internet & American Life Project this month released a study of those who donated toward Haiti relief after the earthquake. Its findings reinforce my belief that those using mobile devices to give to charitable causes are more tech-savvy than the American population overall. They are more likely to:

• Own an e-reader (24 percent as compared to 9 percent of all adults) and a tablet computer (23 percent as compared to 10 percent);
• Use Twitter (23 percent as compared with 12 percent of all online adults) and engage with social-networking sites (83 percent as compared 64 percent);
• Use their phones for activities such as accessing the Internet (74 percent as compared to just 44 percent of all adult cell owners).

Mobile givers also typically are younger, and like the emerging demographics of American society, they are more racially and ethnically diverse when compared with those who contribute through more traditional means, such as writing checks.

In addition, Blackbaud, the technology consulting firm, recently released its “State of the Nonprofit Industry 2012” report with data, issues and trends among charitable organizations in several nations. It noted that among the agencies participating in the study, “the use of mobile technologies in fundraising and marketing will experience explosive growth, in most cases more than doubling in the next 12 months.”

“Explosive growth” is a phrase every fundraiser wants to hear.

Let’s look beyond the complicated and convoluted CRM strategies on which many marketers and chief information officers love to ponder and spend thousands of hours “integrating” donor records for a “seamless experience.” Indeed, the simplicity and convenience of mobile technology combined with the massive power and scalability of cloud computing and the revolution in point-of-sale mobile payment solutions represent the next wave of our profession.

Those anticipating this wave and developing ways now on how to ride it will capture the hearts and minds — as well as generosity — of those dependent on mobile devices for all their personal transactions.

In closing, allow me to offer you an insight from a man whose vision and brilliance have inspired millions. I doubt he was speaking about the new revolution in fundraising, but he could have been:

“Simplicity is the ultimate sophistication.”

That was Leonardo Da Vinci speaking more 500 years ago. And I could not agree more.

Atul Tandon is founder and president of the Tandon Institute and serves as an advisor to social sector organizations to increase impact, revenues, brand awareness and leadership effectiveness. He can be reached at atandon@tandoninstiute.com