Giving is big business in the United States, especially during the holiday season. Though 1999 charitable contributions topped $190 billion, little was collected online. Here's how affiliate programs can help "cause marketing."
Giving is big business in the United States — and the tug of the holidays makes the fourth quarter giving’s biggest season. According to the American Association of Fundraising Counsel, total charitable contributions in 1999 topped $190 billion.
To put that in perspective, FreeLunch (one of my favorite sites for stats of all types) puts 1999 retail spending on books at $14 billion, jewelry at $23 billion, and liquor at $28 billion. In fact, Americans gave almost half as much as the $434 billion they spent on groceries in 1999.
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Giving in the United States — by Source
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| Source |
Amount
|
Share
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| Individuals |
$143.71 B
|
75.6%
|
| Foundations |
$19.81 B
|
10.4%
|
| Bequests |
$15.61 B
|
8.2%
|
| Corporations |
$11.02 B
|
5.8%
|
| Source: “Giving USA 2000,” AAFRC Trust for Philanthropy | ||
Nationwide, some 69 percent of households made a charitable donation in 1999. Online, the story was much different. The somewhat dated September 1999 “Socially Engaged Internet Users” study by Craver, Mathews, Smith and Company reports that only seven percent of the U.S. population has given online. (At the time, the study pegged the total web universe at 50 million people.) While that number is certain to have crept up since then, Amazon.com it’s not.
Where Does the Money Go?
Meanwhile, the number of eligible nonprofits is staggering. GuideStar, which dubs itself “The Donor’s Guide to the Charitable Universe,” lists more than 640,000 charities and 60,000 private foundations. These 700,000-plus nonprofits represent all IRS-registered 501(c)(3) nonprofit organizations. (These are the organizations to which donations are tax-deductible.)
GuideStar has also taken on the task of web-enabling the so-called Form 990 and Form 990 EZ, which are IRS-required financial returns filed by nonprofits with more than $25,000 in annual revenue. Some 200,000 forms later, GuideStar has become the nonprofit equivalent of FreeEDGAR, giving donors the power of information.
What About Online Giving?
When it comes to online giving, the American Red Cross (ARC) is a rare success story. In April 1999, the ARC turned to the web and raised $1.1 million (roughly $36,000 per day) for the Kosovar refugees.
On August 20, 1999, the ARC raised $138,058 in online donations. When The Chronicle of Philanthropy surveyed 252 of the largest charities in 1999, it found that the ARC had garnered more than 40 percent of all online contributions received by the group. Still, the ARC estimates that in 1999, only $3 million of its more than $800 million in donations came over the web.
Your Help Is Needed, Call Now…
So, how can affiliate managers get involved? First, a no-brainer is to participate in the growing number of so-called “giving malls,” which are really just super affiliates with a charitable bent. Next, encourage your company to adopt a charity. Rich Masterson, chairman of GivingCapital and board member of National Philanthropic Trust, has mused, “Every .com should have a .org.” Finally, tell your favorite charity to get on the web.
Giving Malls
Of the giving malls, iGive.com is perhaps the best known. Started in 1997, iGive.com enables consumers to shop from about 240 merchants while directing from 0.4 percent to 12 percent of every purchase to more than 13,000 causes. Most of the merchants are affiliate marketing stalwarts, from Art.com and Amazon.com to Zones.com and Zany Brainy. Since its inception, iGive.com reports raising just more than $800,000 for charities, of which $310,032.69 came in 2000. Not bad, but hardly a drop in a $190,000,000,000 bucket.
Other giving malls include 4charity.com, 4myCommunity, CharityMall, CatholicGiving.com, ChurchGiving.com, ConsumerSaints, eGenerosity.com, givingshop.com, GreaterGood.com, mrgoodbucks.com, MyCause.com, Non-Profit Shopping Mall, ShopForChange, and WebstoreAmerica.com. Schools have their own set of giving malls, including for-schools.com, SchoolCash.com, Schoolpop, and ShopforSchool.
What is perhaps most disappointing about the giving malls is that while they all participate in affiliate marketing as affiliates, very few have benefited from its power by starting their own programs as merchants. iGive.com has a Commission Junction-powered program. ShopForChange (through Working Assets) uses Be Free.
Cause Marketing — Adopt a .Org
Modern day “cause marketing” dates back to 1974 and the advent of the Ronald McDonald House Charities. In the 1980s, The Home Depot, LensCrafters, and Pizza Hut all launched nationwide programs to benefit charities. By the 1990s, a number of retail, automotive, and cosmetic companies supported everything from breast cancer to child welfare.
Cone Communications and Roper Starch Worldwide collaborated on a study in 1999 that found nearly two-thirds of Americans say cause marketing should be a standard business practice. About the same percentage agree that, all other things being equal, they would be likely to switch brands or retailers to those associated with a good cause.
Circa 2000, I found a few lesser-known sites using charitable tie-ins. eRESQ is an ISP that pledges $3 of its $19.95 monthly fee to your favorite charity. Its in-house affiliate program encourages other charities to refer their members. Ourgift.com is a florist that takes a similar tack, offering a 10 percent rebate for charity-placed and charity-referred orders.
Help Charities Find the Web
First, if your favorite charity isn’t online, make your voice heard. Next, make sure your charity can accept donations online. I’ve found nearly two dozen companies that help to web-enable various facets of the giving process. For starters, try Charitableway, GivingCapital, and CharityWeb.
I searched for hours to find examples of charities using affiliate marketing to drive awareness and giving. I had very little success. The Bay Area Chapter of the American Red Cross runs an affiliate program through QuinStreet that pays a 10 percent commission of sales of first aid and emergency kits. The most generous charity program I found was Save the Children, which offers a $24 commission for every child sponsor referred by an affiliate.
Another standout in my research — the Make-A-Wish. Foundation. It runs a giving mall, powered by GreaterGood.com, accepts online donations via CharityWeb, runs a workplace giving program, offers info on its site about becoming a corporate partner (e.g., cause marketing), allows donors to contribute airline, hotel, and loyalty points — and it even runs an affiliate program (though it offers no monetary payout, just the reward of doing good). P.S. The Make-A-Wish Story is worth a read…
Recommended Reading
“All for the Cause,” Business 2.0, October 24, 2000
“The Radical Philanthropist,” Forbes, May 1, 2000
“The 1999 Slate 60,” Slate, February 28, 2000
