According to Giving USA, total giving to US charities declined 5.7% in real terms in 2008 compared to 2007, the first decline in real terms since 1987.
Total giving in 2008 amounted to $307.65 billion, with these components (all declines inflation-adjusted):
- Individuals — $229.3 billion, down 6.3%
- Foundations — $41.2 billion, down 0.8%
- Bequests — $22.7 billion, down 6.4%
- Corporations — $14.5 billion, down 8%
Steve MacLaughlin at Blackbaud analyzed this and other data to conclude that online giving rose to a total of $15.4 billion in 2008, an increase of 44% over 2007. That means online gifts accounted for just over 5% of total 2008 giving (or about 6.7% of individual giving).
Further, he reports that, for Blackbaud clients, online giving in Q1 2009 has risen 68% over the same period in 2008.
I guess that’s good news if you’re an online fundraiser (or consultant). But with the total giving pie down, some of the steam is taken out of that good news. For, with a declining total pie, one must conclude that a lot of online fundraising is simply cannibalizing other channels. No?
Tom
P.S. This modeled Giving USA data mirrors findings from a Target Analytics study earlier this year, based on actual file analysis of 75 national nonprofit direct mailers, that found a decline in individual giving of 3.3% (which compares to Giving USA’s non-adjusted-for-inflation decline of 2.7%).
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Steve often provides “data” but no substantiation or support. Does that growth in their customer base include dollars from orgs that were not using them last year? If you had one organization raise $100 last year and add a new customer and together they raise $168, you have an increase even though real dollars could be down. Just two months ago Blackbaud was quoted in a Forbes article saying “online fundraising hauled in $3 billion…over the last seven years…” The point is, let’s focus on credible data with substantiation.
Tom-
Agreed, online seems to be cannibalizing other channels for some organizations. It’s interesting that other reports seem to indicate that new online donors convert to giving via direct mail. So it’s a connundrum. The challenge for our clients is securing email addresses. Traditional donors seem reluctant, and acquisition is difficult in the online channel for charities without broad appeal and media exposure. As you say, it’s good news if you are working in the online arena, but troubling if you are responsible for the whole pie.
I find Steve MacLaughlin’s conclusion of online giving silly unless that he can demonstrate that online giving has actually increased or has there been a shift in method of payment. Since Steve is someone that sells online transaction tools I would expect more disclosure of actual data to reach a conclusion that benefits the sale of his products.
Where is the beef?
[...] Total Giving Down; Online Up | The Agitator – Fundraising, Direct … [...]
I believe Paul’s perspective is very smart. Why didn’t Steve tell us if the data included nonprofits that added online giving options?
I attended a recent cause marketing conference where many of the online giving sales folks were attempting to promote their tools. When asked if they could provide relevant peer specific data on results of implementing more robust online giving via social media tools, most only answered -”its where the donor is going now and in the future”. Most of my peers are not seeing meaningful, incremental growth in this area. I believe that it is a long-term bet which we must continue exploring and exchanging best practices openly.
Data is plural (datum is the singular). “These data”…; not “this data.”