Fees and other requirements could deter political campaigns from embracing mobile text fundraising.
The Federal Election Commission ruled this week that voters can donate to political campaigns via text message. While many at mobile and digital firms who work with political clients are excited about collecting text donations, others see obstacles such as potentially hefty fees that could detract from implementing text fundraising efforts. Also, it could take months for logistics to be put in place to enable political text giving.
"We're just excited to actually finally be able to do this," said Cami Zimmer, president of Campaign Touch, a mobile and digital firm that builds mobile apps and runs mobile and digital ad campaigns for political clients.
Allowing text donations to political campaigns could increase small donations, which some argue propels political engagement and voter participation. However, there are lots of details to work out. And, some wonder whether it's worth fundraising using a system that could give a substantial cut of donations to the carriers and others involved in the process.
Political text contributions won't happen at all until mobile carriers come to an agreement with the FEC regarding the fees they'll charge for enabling them. Zimmer and others said they expect that to happen in the next couple weeks.
Short code provisions involving the carriers also need to be put in place, and that could take much longer, said Jon Aust, CEO of MobileCon, a mobile strategy consulting firm that runs SMS campaigns for Republicans. According to the FEC advisory opinion, each political committee will be assigned a short code for use during the 2012 election cycle.
Establishing short codes "could take anywhere from 8 to 12 weeks," said Aust. He said he expects carriers will work with the Mitt Romney and Barack Obama campaigns in the hopes of expediting the process.
"My expectation is that the carriers will work to accelerate that process such that there will be some meaningful availability in this campaign cycle," he said, adding, "In terms of widespread adoption it's going to be down the road a bit."
Fundraising is a great way for political campaigns to gather contact information of supporters, but according to the FEC opinion campaigns would not get as much information via text donations as they could using other fundraising methods. M-Qube, an SMS text aggregator that is approved to enable political text donations, will provide campaigns with phone numbers associated with contributions and track the total amount given through a specific phone number. However, "m-Qube does not propose to provide the contributor names and addresses to political committee customers," states the FEC document.
Not only would the carriers get a piece of the donation action, so would m-Qube. In the case of political donations, m-Qube would pay campaigns a portion of the contribution amount upfront so they can use the money right away - which is typically an important element of political fundraising efforts. The FEC said the firm is required to extend the credit according to the same terms it agrees to with non-political clients. In the end, total fees incurred could be as high as 50 percent.
The fee-based concept is not new in the world of political fundraising, where direct mail and email firms also sometimes skim money from the top to pay for their services. More recently, revenue sharing agreements have gained in popularity for email campaigns. Email list sellers agree to send fundraising emails on behalf of political campaigns at no upfront cost, then take a chunk of the donations - sometimes as much as 60 percent.
Republican digital strategist Vincent Harris, founder and CEO of Harris Media, is not deterred by the potential text donation fees. "I can only imagine more competition will quickly fill the space and lower those costs," he said.
According to the FEC advisory opinion, "no mobile phone number may be billed more than $50 per month for contributions to anyone political committee customer," and m-Qube will confirm that donors are eligible to give.
Currently, campaigns can use text short codes to facilitate mobile giving but the FEC ruling will simplify the process, said Aust. For example, his firm ran a mobile fundraising campaign for Wisconsin Governor Scott Walker's recall election campaign that allowed supporters to text a keyword to a short code, and then sent them a link to a donation page.
"If you compare it to the fundraising that we did with the Walker campaign... the text-to-donate obviously is frictionless," said Aust.
Whether political text donation efforts result in more spending on text messaging and mobile advertising by campaigns remains to be seen. However, some don't necessarily think text donations will play out exclusively in the mobile environment. Instead, candidates can be expected to solicit text donations during campaign rallies or fundraising events.
One political consultant working with a large GOP campaign had a more reserved reaction to the FEC decision. Speaking on background, he wondered why a campaign would solicit donations during a rally through a text messaging system that requires a relatively large fee when a mobile payment system like Square could be used instead. According to Square's website the firm charges 2.75 percent for each credit card transaction.
Aust suggested campaigns will use text fundraising out of convenience. "It's convenient and convenience sells in any environment," he said.
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Kate Kaye was Managing Editor at ClickZ News until October 2012. As a daily reporter and editor for the original news source, she covered beats including digital political campaigns and government regulation of the online ad industry. Kate is the author of Campaign '08: A Turning Point for Digital Media, the only book focused on the paid digital media efforts of the 2008 presidential campaigns. Kate created ClickZ's Politics & Advocacy section, and is the primary contributor to the one-of-a-kind section. She began reporting on the interactive ad industry in 1999 and has spoken at several events and in interviews for television, radio, print, and digital media outlets. You can follow Kate on Twitter at @LowbrowKate.
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