Nonprofit Online Fundraising: How to Maximize Value of Smaller Donations
One of the best ways to tackle a big job is to break it down into less intimidating chunks. It’s an approach that works just as well in nonprofit online fundraising as many other areas of life – running multiple campaigns, each with a smaller goal, may be more effective than one campaign with a much higher target.
However, while smaller amounts of money are easier to raise, you might be worried that running multiple smaller campaigns could mean more overhead costs and time commitment. That’s why FundRazr introduced its microproject option – we automate most of that work, leaving you, the nonprofit organizer, to focus on what really matters.
Why is it important for nonprofit online fundraising?
The Internet is becoming an ever-more central part of our everyday lives, and raising money is no exception to that rule. With the Baby Boomer generation aging, Millennials, and members of Generation Z will soon make up the majority of donors. Failing to adapt to these new groups by not making smart use of online fundraising platforms is a path to financial hardship for even the most deserving organization.
Therefore, strategic, informed use of these tools is paramount. Although simply posting your crowdfunding campaign page and hoping for donations is better than nothing, it isn’t enough to help you reach your goals. The nonprofit marketplace is getting more competitive, as more and more campaigns fight for attention. What’s more, ongoing changes to the social media algorithm are making it harder to get noticed—not only to acquire new donors but also to keep them engaged in the long run.
To generate sustainable, long-term funding, nonprofits need to be creative, on top of trends, and psychology oriented. If done properly, these approaches will result in donors who take joy from staying connected to your cause and being part of your community, and whose year-over-year donations are not only a backbone of your organization’s funding but a source of pride for them.
What is the solution?
This is a pivotal moment for the nonprofit online fundraising sector. The way donors give and engage is changing, shifting from fewer major-sized donations to a model of repeated micro-giving, with lower overhead per transaction and higher rates of engagement with your cause. To suit this new donor preference, projects that refactor themselves to focus on small, very specific goals result in higher rates of success, donor satisfaction, and, of course, aggregate dollars raised.
Microprojects are repeating campaign concepts that can be personalized, but share a similar structure. For example,instead of raising one large lump sum to keep an animal shelter running for a year, you could break it down into fifty small campaigns, each sponsoring an individual animal.
Microprojects are a powerful method of fundraising that tackle three of FundRazr’s Seven Strategic Benefits:
- Microprojects boost efficiency, creating bigger, better, more powerful, more functionally complete and more compelling campaigns with less work
- Microprojects excel at communicating impact; conveying to the individual the power of their gifts and donations in a constant, direct, and cost effective manner
- Due to their entertaining, interactive nature, these campaigns ensure sustainability – giving volunteers, advocates, sponsors and community members such great experiences that they help out again and again.
Why donors like microprojects?
Donors prefer microprojects over traditional appeals because they feel as if they make a bigger impact on achieving the goal and the project’s success. If you think about it, making a $100 donation to a project with a $1,000 goal provides is more satisfying than giving $100 toward a $1 million goal. The first gift feels like you made a bigger impact, even though the size of the gift is the same. Although the $1,000 goal may be one of a sequence of many small projects, helping donors feel like THEY were the reason THIS phase of the project was successful is key to inspiring them to give more gifts to future phases and achieving a greater aggregate value of the gifts.
The psychological basis for this behaviour is that it triggers the completion effect. As humans, we are driven to want to finish projects. Seeing our gifts make a big difference in moving a project toward completion satisfies a primal part of our nature and triggers the release of endorphins and oxytocin—the hormones that make us feel all warm and fuzzy. The closer we moved the project to the goal, the better we feel.
One particularly effective strategy is to never start a project at zero—apply some previously confirmed sponsor money to the campaign, and then ask the crowd to move you the rest of the way there. This strategy amplifies the completion effect and helps your donors feel especially valuable. By reducing the amount asked for, you’re ramping up the psychological impact of the gifts, helping your donors to truly feel like they’ve made a difference.
And with FundRazr’s platform,most of the extra work in running multiple campaigns is eliminated, as the master template can be applied effortlessly to campaign after campaign.
How it works?
The main way we’ve made microprojects easier to implement are templates that can be copied from one campaign to the next. This allows you to create many campaigns at once that all share a similar structure, uniting them under your brand. The story and imagery from the Master campaign is automatically included in each sub-campaign. For each sub-campaign, details and visuals can be tweaked as needed, while still retaining all the tax receipt setup,payment settings and properties that link back to your organization.
As with other types of FundRazr campaigns, you have the option of either a Hidden or Public Master Campaign. If you choose to set your Master Campaign to Public, the grand total that you’ve raised across all microprojects will be visible. Usually, this is a great idea – if potential donors can see all the combined donations, it will give your cause legitimacy and show off the real-world impact of their dollars. Alongside each microproject’s page, we’ll display a ‘Related Campaigns’ tab – this will let potential donors browse through other Micro pages, finding even more ways to take part and contribute.
With microprojects, FundRazr’s Incentives feature really comes in handy. Since these types of projects allow donors to watch their generosity in action, integrating features like Wishes can really step up emotional impact. In the animal shelter example given above, donors could buy a Wish of one week of care for an animal, rather than just pitching in a few dollars to a massive overall target. Of course, other FundRazr features like updates and the option to Keep it All are available on microprojects campaigns as well.
Is there an example?
As we mentioned earlier, having many microprojects running continuously, or even concurrently, results in sustainable, even-keeled income for your organization. Your revenue curve will smooth out, as the many small projects are constantly completing and bringing in money—no more waiting anxiously for the big final push that you need to meet your monthly goals.
All donors want to help others and see that their hard work is having an impact – how better than to make a $100 donation that gets an underprivileged child into school? That’s how One Girl Can is using microprojects for incredibly effective results. This charity supports girls’ education in Africa by fundraising to build and operate schools. When One Girl Can started, its online fundraising projects had big goals, often talking about the schools as a whole and big-picture online fundraising needs. Eventually the charity broke down the goals into smaller units that would have the maximum emotional impact, arriving at the idea to raise money for individual girls who attend the schools. One Girl Can created a micro-project for each girl, telling her story compassionately and honestly and asking donors to fund her individual education, always taking care to ensure the campaigns were done in a sensitive manner that took into account the girls’ privacy and individual preferences. Donors have the option of making a single gift or signing up for monthly recurring donations to a specific micro project.
This approach means donors don’t need to think in abstract terms. The impact of the school in Africa, the lives it will change, and the futures it will brighten are laid out for donors in an engaging and emotionally affecting manner. In addition to the smaller goals that play into donor psychology, having a human face attached to a project will attract more attention and donations. Of course, these things matter to many donors, but they matter to donors from the Internet generation especially—and not only because as younger people, their donation budgets are often small and stretched thin. These donors need to feel that their gift matters, and $100 toward a $2,000 scholarship feels so much more impactful than a $100 gift to a school’s program’s $500,000 annual budget.
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So remember, more campaigns don’t have to mean more work! With microprojects, you can break down your nonprofit online fundraising goals into chunks that are easier for donors to handle – without make it more complicated for your team, either!
FundRazr has the tools you need to painlessly raise funds for your cause, boosting efficiency and communicating impact by breaking your goal down into smaller steps that let your supporters really see where their dollars and donations are going.
We can’t wait to see how you utilize microprojects. The possibilities are endless!
Create your campaign now or talk with our crowdfunding expert about your fundraising goals.