Digital Fundraising Innovations and Trends to Watch in 2023

While there are always risks involved in new fundraising innovations, many times these risks are well worth taking — and, in some cases, you can’t afford not to take them. As 2023 beckons, it’s time to explore the major innovations I expect to see in digital fundraising in the year ahead.

Embracing the Third Shift to Digital-First Social Fundraising

Fundraising began as a largely direct mail-based initiative, then later evolved to a web-based model, through fundraising pages on nonprofit websites. Today, we are witnessing an evolution to digital-first social fundraising. Why is this happening now?  Because people want fundraising opportunities that are frictionless and easy to access. In 2022, the average human attention span dropped to an all-time low of eight seconds, and as technology and advertising have been forced to evolve, so too must fundraising.

In this context, we can no longer require five clicks to make a donation, nor can we expect donors to leave the preferred sites they frequent most often. People want to make donations right when and where they are — which is increasingly social media networks. If the donation process is too arduous or requires too many steps, you’re at a very high risk of losing fleeting interest. 

Besides shortening the donor journey, the surrounding social network context also provides nonprofits the opportunity to influence and educate people while they’re on the path to making a donation. I’ve seen this phenomena occur in other social settings — one reason social storefronts are so successful is that social media influences up to 71% of consumer buying decisions. 

Still, we see many nonprofits resisting the shift to digital-first social fundraising because it forces them to relinquish a certain amount of control. Not only are they at the whim of social networks’ ever-changing algorithms, but social media often affords comparatively little in terms of cultivating donor names and email addresses to add to a database (although this is changing, with options available for cultivating donor’s most common demographic profiles and zip codes). 

As a result, many nonprofits are not  fully investing in  social fundraising, leaving potentially large amounts of money on the table. When it comes to the third shift, many nonprofits need to adopt a new mindset. Social fundraising is a risk worth taking and nonprofits have to be comfortable with the fact that they may not be able to perfectly control it but can definitely find benefit for their mission.

Capturing Recurring Donations

Social media lends itself well to the creation of online communities that can quickly and easily be reactivated to reengage participants and host repeat fundraising events, helping create more consistent, predictable revenue streams. Another reason repeat fundraisers are so beneficial — they drive the all-important second action, and are the greatest factor affecting donor retention.

Meta itself recognizes the crucial importance of the second gift, as evidenced by its recent decision to extend its annual matching program. Meta has been matching one-time donations on Facebook for the past 10 years on Giving Tuesday, but this year the company has decided to expand that matching through Dec. 31 for recurring donations. 

When a donor signs up for a recurring donation during the qualifying period, Meta will match 100% of the donation (up to $100 and $100,000 per nonprofit) after the second monthly donation is made on Facebook. By doing its part to prompt second gifts, Meta is helping nonprofits capture recurring donations, which it knows are so vital to sustaining donations beyond the holidays to further lifetime value.

Personalizing the Donor Journey

Using messaging automation capabilities in email, text and social media chat can be very impactful in individualizing interactions and cultivating donations. Facebook Messenger is particularly valuable, with open rates hitting 80% at times, compared to 5% to 10% percent for email open rates. Recipients enjoy the short bursts of content and quick intakes they provide, as these align to their real-time thinking.

Regardless of the vehicle chosen, the messaging needs to be highly personalized — for instance, wishing someone who just completed a birthday fundraiser with a “happy birthday” message, or referring to one’s recent participation in a Facebook challenge. This capability also needs to be implemented and managed at scale, helping to fuel more intent-filled interactions throughout the course of the year in an efficient manner for your organization. 

Arianna Huffington once said, “Data is great. But sometimes, even when you have all the data in the world … you won’t discover the true potential and be able to recognize critical opportunities.” 

While aggregated data remains an important part of the nonprofit playbook, the innovations and trends I discussed have little to do with proactively accumulating donor contact information and more to do with tapping the unique, inherent powers of social media — friction-free giving, easy repeatability and second-gift encouragement, and personalization — to drive real value. These powers may rely less on traditional marketing techniques and even feel more reactive, but they are no less valuable and will play a key role in digital fundraising in 2023 and beyond.