2010 Online Giving Report - Blackbaud · Introduction 2010 saw continued growth in the importance of online fundraising for nonprofit organizations. ... peer-to-peer fundraising,

© February 2011 | 2000 Daniel Island Drive, Charleston, SC 29492 T 800.443.9441 E [email protected] W www.blackbaud.com

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Introduction

2010 saw continued growth in the importance of online fundraising for nonprofit organizations. A

recovering global economy, online response for disaster relief, peer-to-peer fundraising, and the role of

social media in the nonprofit sector all shaped the year.

Blackbaud has been engaged with supporting online giving for nonprofits for more than a decade. In July

2010, Blackbaud used online giving data from our extensive customer network to launch The Blackbaud

Index of Online Giving. The Index provides visibility into online giving trends in the nonprofit sector and

represents the largest and most diverse monthly review of online giving trends available today.

The 2010 Online Giving Report combines findings from The Blackbaud Index of Online Giving with

additional multi-year giving data to provide the most comprehensive analysis of online giving trends in the

nonprofit sector. The Report includes 24 months of online giving data from 1,812 nonprofit organizations

from The Blackbaud Index of Online Giving, online major giving data from 2,190 nonprofits, and both

online and offline data representing $5.1 billion in total fundraising from 1,438 nonprofits.

Significant work has gone into building the analysis model and making sure the data meets strict

requirements. This includes collecting online giving data on a monthly basis over 24 months, checking

and rechecking for anomalies, classifying each organization by sector using the National Taxonomy of

Exempt Entities (NTEE) code, matching and retrieving reported total revenue information, and applying

statistical expertise to create a three-month rolling average.

Summary of Research Findings

In 2010, online giving continued to grow for nonprofits included in the analysis. Year-over-year growth

was 34.5% compared to 2009. This was led by 55.6% growth by large organizations. Smaller nonprofits

grew by 22%, and medium organizations grew by 15.9% compared to the same time period in 2009.

Continued

2010 Online Giving Report

ContentsIntroduction . . . . . . . . . . . . . . . . . 1

Summary of Research Findings . . 1

Overall 2010 Online

Giving Trends . . . . . . . . . . . . . . . . 2

Trends by Month . . . . . . . . . . . . . 3

Trends by Nonprofit Sector . . . . . . 5

Online Disaster Giving Trends . . . . 5

Online Major Giving Trends . . . . . . 6

Trends by Percentage of Total

Fundraising from Online Giving . . . 7

How to Use this Report . . . . . . . . . 8

About the 2010 Online

Giving Report . . . . . . . . . . . . . . 12

About Blackbaud . . . . . . . . . . . . 13



The impact of the Haiti earthquake on online giving was significant. For the first time, January had the

largest percentage of online giving for the entire year, with 18.4% of online giving taking place in January

2010 compared to 18.3% in December 2010. This variance, versus previous years, where December

sees approximately one-third of online revenue, is solely attributed to Haiti relief funds collected by

International Affairs organizations. International Affairs organizations saw online giving grow 130.8%

compared to 2009.

For other sectors, end-of-year giving still accounts for the largest percentage of online donations. When

combined, October, November, and December of 2010 represented 31.3% of total online giving during

the year. All sectors in the analysis, with the exception of International Affairs, had their largest online

giving month of the year in December.

Donors continue to make significant gifts online. In 2010, 88% of organizations had at least one online gift

of $1,000 or more. The median online gift of $1,000 or more was $1,250 and the largest amount given

online in the analysis was $100,000. 41% of these significant gifts were exactly $1,000, and 6% were

$5,000 gifts.

The percentage of total fundraising that comes from online giving has grown to 7.6%. This percent of

revenue analysis is based on a sample of 1,438 nonprofits with total funds raised of $5.1 billion. Since

the last analysis of this kind, large organizations have shifted from having the lowest percentage of online

dollars to total funds raised to the highest percentage. International Affairs and Health Care sectors now

bring in more than 10% of total fundraising from online giving.

Overall 2010 Online Giving Trends

Online giving grew 34.5% year-over-year for the 1,812 nonprofit organizations in the analysis. There were

differences between how organizations of different sizes performed in 2010.

Online Giving Growth by Organization Size

Size YOY % Change

Small (Less than $1M) 22.0%

Medium ($1M - $10M) 15.9%

Large ($10M+) 55.6%

Total 34.5%


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Online giving grew 34.5% year-over-year.


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Large nonprofits, with annual total fundraising greater than $10 million, grew their online fundraising

55.6% on a year-over-year basis. Medium-sized nonprofits, with annual total fundraising between

$1 million and $10 million, had a year-over-year increase of 15.9% in their online fundraising. Small

nonprofits, with annual total fundraising less than $1 million, had online giving grow 22.0% on a year-

over-year basis.

The complete Blackbaud Index of Online Giving is represented in the chart below. The Index is based

on actual revenue statistics from 1,812 nonprofit organizations using a variety of fundraising systems.

It is reported as a three-month rolling average by adding all of the giving for the prior three months and

comparing this total to the same three months one year earlier to calculate the annual percent change.

This three-month rolling average is used to smooth out month-over-month fluctuations in fundraising

that frequently occur in the nonprofit sector. The spike in online giving growth during March 2010 is

an example of how Haiti relief giving has been distributed across several months. An index based on

a moving average is less sensitive to these small timing issues and will serve as a more practical

decision-making tool.

Trends by Month

The analysis looked at the distribution of online giving across all of 2010. It is worth noting that January

had the largest percentage of online giving for 2010. December has traditionally been the largest month

for online giving, but the significant giving towards Haiti earthquake relief efforts in 2010 altered

normal trends.


2010 Blackbaud Index of Online Giving

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

+52.5% +58.1% +240.8% +50.1% +25.9% +14.7% +13.6% +21.9% +21.9% +16.3% +9.5% +3.2%

2010 Online Giving Distribution by Month

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

18.4% 5.9% 6.6% 6.6% 6.3% 6.3% 5.2% 6.4% 7.1% 6.5% 6.6% 18.3%

Giving towards Haiti earthquake relief efforts in 2010 altered normal trends.


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This breakdown shows monthly giving percentages based on the size of the organization. This uses

the same small (less than $1 million), medium ($1 million to $10 million), and large ($10 million+) total

annual fundraising scale. Small- and medium-sized organizations had their largest online giving month in

December 2010. Large nonprofits had their biggest month in January, which is directly attributed to online

giving towards Haiti relief.

The research classified each organization by sector using the NTEE code. All sectors in the analysis, with

the exception of International Affairs, had their largest online giving month of the year in December. This

represents a typical trend in online giving over the past several years.


2010 Online Giving % by Month—by Size

Size Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Small

(Less than $1M)

5.4% 6.4% 9.4% 10.7% 7.1% 6.4% 7.6% 6.7% 10.1% 10.2% 8.2% 11.8%

Medium ($1M - $10M)

7.5% 6.4% 7.8% 9.1% 7.8% 6.9% 6.4% 7.5% 9.7% 7.9% 7.2% 15.9%

Large ($10M+)

22.5% 5.8% 6.1% 5.6% 5.9% 5.8% 4.6% 6.1% 6.1% 5.7% 6.3% 19.5%

Total 18.4% 5.9% 6.6% 6.6% 6.3% 6.3% 5.2% 6.4% 7.1% 6.5% 6.6% 18.3%

2010 Online Giving % by Month—by Sector

Sector Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Arts, Culture,

and Humanities

5.2% 7.4% 8.8% 7.8% 7.9% 7.5% 5.6% 6.0% 7.2% 10.5% 7.8% 18.3%

Education 5.5% 5.9% 8.2% 8.4% 8.7% 12.0% 4.1% 4.0% 6.0% 7.4% 7.4% 22.6%

Environment and Animals

6.0% 5.1% 11.9% 11.4% 9.6% 7.9% 6.9% 6.0% 7.3% 5.6% 5.7% 16.5%

Health Care 5.5% 5.2% 7.4% 8.7% 8.2% 7.5% 7.9% 9.6% 11.1% 8.9% 7.9% 12.3%

Human Services 13.2% 8.2% 7.7% 6.8% 6.2% 5.4% 4.7% 5.2% 5.6% 6.3% 7.2% 23.7%

International Affairs 47.3% 5.7% 3.1% 2.3% 2.4% 2.0% 1.5% 3.4% 2.4% 2.3% 4.3% 23.4%

Public / Society Benefit

10.6% 7.4% 11.2% 7.1% 7.6% 7.6% 6.6% 7.7% 9.0% 7.7% 5.6% 12.7%

Total 18.4% 5.9% 6.6% 6.6% 6.3% 6.3% 5.2% 6.4% 7.1% 6.5% 6.6% 18.3%


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Trends by Nonprofit Sector

Each organization in The Blackbaud Index of Online Giving is categorized by one of seven sectors using

its National Taxonomy of Exempt Entities — or NTEE code — as reported on its 990 tax return. These

sectors are Arts, Culture, and Humanities; Education; Environment and Animals; Healthcare; Human

Services; International Affairs; and Public and Society Benefit. Religious organizations are currently

excluded as the 990 tax data set available for this group is not considered representative at this time.

International Affairs organizations had the biggest year-over-year online fundraising growth. This was

followed by Human Services, Environment and Animals, Public and Society Benefit, and Education

organizations. Arts, Culture and Humanity nonprofits and Healthcare organizations each had less than

10% growth in 2010 as compared to 2009.

Online Disaster Giving Trends

On Tuesday, January 12, 2010, a 7.0 magnitude earthquake struck the island of Hispaniola. The

earthquake occurred at 4:53pm EST and its epicenter was 16 miles west of Port-au-Prince, Haiti. The

resulting damage from the earthquake and subsequent aftershocks significantly impacted those living and

working in Haiti.

The Chronicle of Philanthropy estimates that charities raised more than $1.4 billion for Haiti’s relief and

recovery1. During the first few hours and days following the earthquake, a substantial amount of this

was raised through online giving. While organizations did respond to other disasters during 2010, the

earthquake in Haiti revealed valuable information for nonprofits to leverage in the future.


Online Giving Growth by Growth by Sector

Sector YOY % Change

Arts, Culture, and Humanities 8.7%

Education 13.7%

Environment and Animals 28.4%

Health Care 7.4%

Human Services 29.3%

International Affairs 130.8%

Public / Society Benefit 15.0%

Online giving peaked after three days following the Haiti earthquake.


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Three important trends were noted from nonprofit organizations raising money directly related to the

Haitian earthquake relief effort. First, the vast majority of money raised online was given to a small number

of International Affairs organizations. They were able to engage donors quickly through the use of email,

web, social, and mobile channels. This underscores the importance for nonprofits to be prepared in

advance of such emergencies.

Second, online giving peaked after three days following the earthquake and continued to decline

afterwards. Giving did continue after this period, but in much smaller amounts. Unlike other fundraising

channels, online giving provides nonprofits with more real-time metrics about what is happening.

Monitoring, measuring, and adjusting during the first few hours and days following a disaster is something

nonprofits should be doing.

The third trend is revealed by the total online funds given in the first five days following the earthquake

compared to giving following other recent disasters. Online giving in the first five days following the Haiti

earthquake was 19% greater than response to the 2004 Asian Tsunami and 109% greater than Hurricane

Katrina in 2005. The tsunami data begins on December 26, 2004, following the earthquake off the west

coast of Sumatra, Indonesia. The Katrina data begins on August 29, 2005 when the hurricane made its

second landfall in Louisiana. Online giving during the first five days following September 11, 2001 was

less than 1% of what was given towards Haiti relief.

Online giving is becoming the first-response method of choice for donors. Major events like the Haiti

earthquake are going to continue to increase the use of online and mobile technologies to engage with

donors. Nonprofits across all sectors can learn valuable lessons from Haiti and apply them to their

fundraising efforts.

Online Major Giving Trends

Blackbaud analyzed trends around significant donations made online for the third consecutive year. The

online gifts of 2,190 organizations were reviewed to look trends for donations of $1,000 or more in 2010.

88% of nonprofits in this analysis had at least one online gift of $1,000 or more. This was an increase

from 77% in 2009.


Online giving is becoming the first-response method of choice for donors.

88% of nonprofits had at least one online gift of $1,000 or more.


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The largest online gift made in 2010 was $100,000 and there were 10 gifts of this size. This was up from

2009, when the largest online gift was $60,000. The median online gift of $1,000 or more was $1,250.

Online gifts of a significant amount are likely to increase and be a greater source of fundraising results

for nonprofits.

2010 Distribution of Online Gifts of $1,000 or More

Trends by Percentage of Total Fundraising from Online Giving

Blackbaud continues to do research into the percentage of total fundraising that comes from online

giving. This data is especially valuable because it allows nonprofits to benchmark online giving against

peer organizations within each sector.


2010 Distribution of Online Gifts of $1,000 or More

$1,000 $1,001 – $4,999 $5,000 $5,001 – $9,999 $10,000+

4%6%

45%

41%

4%

% of Total Fundraising from Online Giving

Size YOY % Change

Small (Less than $1M) 7.5%

Medium ($1M - $10M) 7.6%

Large ($10M+) 7.7%

Total 7.6%

On average, online donations accounted for 7.6% of overall fundraising.


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Blackbaud used data from The Blackbaud Index of Online Giving over the past year to examine

percentage of total fundraising that came from online giving. We looked at total giving for 1,438

organizations of varied size and found that, on average, online donations accounted for 7.6% of overall

fundraising. Large organizations now lead the way with 7.7%, followed by medium-sized nonprofits with

7.6%, and smaller organizations with 7.5%. It is worth noting that large nonprofits grew from 5.1% to

7.7% since the analysis of 2009 giving.

International Affairs and Healthcare organizations have the largest percentage of total fundraising coming

from online giving. This can be attributed to both online disaster giving and peer-to-peer fundraising.

Nonprofits can use this as a basis for benchmarking their own organizations and their performance

relative to other nonprofits.

How to Use this Report

The intent of this report is to provide data that is useful in helping each organization understand its

online giving performance and to drive conversations and analyses among organizational leadership that

uncover opportunities to improve performance. The best way to evaluate your organization’s online giving

performance is to compare the percent of funds your organization brings in online to the percent brought

in by your peer organizations and to look for best practices demonstrated by organizations that are

outperforming your peer group. To evaluate whether your organization is capitalizing on the opportunity

available through online fundraising, follow these steps.


% of Total Fundraising from Online Giving

Sector %

Arts, Culture, and Humanities 4.6%

Education 2.7%

Environment and Animals 5.9%

Health Care 12.0%

Human Services 4.5%

International Affairs 15.1%

Public / Society Benefit 5.3%


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1. Select the group that best represents your organization:

Size:

Small (less than $1 million in total fundraising)••

Medium ($1 million to $10 million in total fundraising)••

Large ($10 million+ in total fundraising)••

Sector

Arts, Culture, and Humanities ••

Education ••

Environment and Animals ••

Healthcare ••

Human Services ••

International Affairs ••

Public/Society Benefit••

2. Calculate your percentage of online giving as related to total fundraising revenue:

Input your organization’s total online revenue in 2010:

Input your organization’s total fundraising revenue as reported on your 2010 tax return:

Divide total online revenue by total fundraising revenue to calculate percentage:

3. Compare your percentage of online giving as related to total fundraising revenue to the group

you have selected to benchmark against:

Your Organization’s Online Percentage of Total Fundraising:

Your Benchmark Group’s Online Percentage of Total Fundraising:

4. Analyze your results:

If you elected to benchmark yourself based on size, locate your organization’s performance on ••

this scale:


Under Performers <5 %

Average Performers 5 – 8%

Exceptional Performers 8%+


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If you elected to benchmark yourself based on sector, locate your organization’s performance on ••

this table:


SectorUnder

PerformersAverage

PerformersExceptional Performers

Arts, Culture, and Humanities

<4.1% 4.1% – 5.1% >5.1%

Education <2.2% 2.2% – 3.2% >3.2%

Environment and Animals <5.4% 5.4% – 6.4% >6.4%

Healthcare <11.5% 11.5% – 12.5% >12.5%

Human Services <4.0% 4.0% – 5.0% >5.0%

International Affairs <14.6% 14.6% – 15.6% >15.6%

Public/Society Benefit <4.8% 4.8% – 5.8% >5.8%


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Once you have identified your online fundraising performance, refer to the chart below to start the

conversation at your organization:

Additional analysis by sector will be available at www.nptrends.com and www.netwitsthinktank.com.


Under Performers

Frequently fit this profile:

Traditional major gift focus••

New to online ••

giving programs

Lower online gift volume••

Higher average ••

gift amounts

Higher online ••

donor retention

Should consider:

Auditing your web ••

presence — would your

site design, functionality,

and security win the

confidence of a potential

new donor?

Analyzing your web traffic •• —

is your site optimized for

visitors to find through

search engines? Do your

offline marketing channels

effectively promote your

web site?

Effective websites are more

than passive data collectors.

They are the most important

way for your organization to

attract new supporters and build

relationships with those you

have. Make sure yours is easy

to find and comfortable to use.

Average Performers


Mix of fundraising channels••

Online giving is bigger ••

focus

Moderate online ••

gift volume

Moderate average ••

gift amounts

New donor growth ••

is from online

Should consider:

Auditing your online ••

campaigns — are you

fully embracing the

opportunities provided

by year-end giving

spikes? Are you

messaging effectively and

promptly surrounding

relevant events?

Analyzing your site’s••

information architecture,

navigation, and content —

is your site built for your

visitors’ priorities or your

own? Can each key

audience group easily

accomplish the goal of

its visit?

To improve performance of a

satisfactory website, make sure

it is fully optimized to meet the

needs of your audience. By

removing friction from online

processes, conversion rates

improve and return visits and

referrals become more likely.

Exceptional Performers


Traditional direct ••

mail focus

Mature online ••

giving programs

Higher online gift volume••

Lower average ••

gift amounts

Lower online ••

donor retention

Should consider:

Auditing your site for ••

supporter engagement and

stewardship — are you

providing value to motivate

repeat visits? Is the impact

of giving to your cause

promoted effectively?

Analyzing your online ••

ask—is it aggressive

enough based on your

average online gift? Does

it adjust dynamically based

on the giving history of

the donor?

To further capitalize on this

effective channel, you will need

to explore taking your site to the

next level. Consider the service

and functionality provided by

the leading online companies

and organizations. Today’s Web

users expect personalization,

social experiences, and

acknowledgment of their

meaning to your organization.


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About the 2010 Online Giving Report

The findings in this report are based on online giving data from 1,812 nonprofit organizations in

The Blackbaud Index of Online Giving across 2009 and 2010. To be included in the analysis, these

organizations needed to have 24-months of complete online giving data with no gaps or missing

information. Each organization was then classified by sector using their NTEE code as reported on its 990

tax return.

If you are not sure what sector your organization is classified as, you may refer to your 990 to find your

NTEE code. Visit http://nccs.urban.org/classification/NTEE.cfm for a complete listing of sectors.

Organizations were then grouped into three size categories: total annual fundraising less than

$1 million (small), total annual fundraising between $1 million and $10 million (medium), and total annual

fundraising exceeding $10 million (large). This is based on recorded giving in their fundraising systems,

reported fundraising in IRS Form 990 data, and matching done through the National Center for

Charitable Statistics.

Organizations without all the research criteria were not included in this analysis. Organizations based

outside the United States were excluded from this analysis. We do not include the unfulfilled portion of

pledge gifts or recurring gifts that are processed offline. This is the same criteria used for The Blackbaud

Index of Online Giving.

The online major giving trends research is based on online donation data from 2,190 organizations.

This is part of a data set Blackbaud has been measuring on a longitudinal basis since 2008. Only 1,927

organizations with at least one online gift of $1,000 or more are included in this analysis.

The percentage of total fundraising trends research is based on 1,438 nonprofits in The Blackbaud Index

of Online Giving. These organizations represent $5.1 billion in total fundraising.

Blackbaud extends special thanks to Steve MacLaughlin, Jim O'Shaughnessy, Chris Clark,

Allison Van Diest, and Chuck Longfield for contributions to this report.

1 “Haiti Earthquake Fund Raising, One Year Later” http://philanthropy.com/article/Haiti-Earthquake-Fund-Raising/125896/


> Subscribe to The Blackbaud Index at www.blackbaud.com/blackbaudindex to get alerts and updates emailed monthly and for more information about giving trends.


© February 2011, Blackbaud, Inc.

This white paper is for informational purposes only .

Blackbaud makes no warranties, expressed or

implied, in this summary . The information contained

in this document represents the current view of

Blackbaud, Inc ., on the items discussed as of the

date of this publication .

All Blackbaud product names appearing herein are

trademarks or registered trademarks of Blackbaud,

Inc . The names of actual companies and products

mentioned herein may be the trademarks of their

respective owners .

About BlackbaudBlackbaud is the leading global provider of software and services designed specifically for nonprofit organizations, enabling them to improve

operational efficiency, build strong relationships, and raise more money to support their missions. Approximately 24,000 organizations —

including The American Red Cross, Cancer Research UK, Earthjustice, International Fund for Animal Welfare, Lincoln Center, The Salvation

Army, The Taft School, Tulsa Community Foundation, Ursinus College, the WGBH Educational Foundation, and Yale University — use one or

more Blackbaud products and services for fundraising, constituent relationship management, financial management, website management,

direct marketing, education administration, ticketing, business intelligence, prospect research, consulting, and analytics. Since 1981,

Blackbaud’s sole focus and expertise has been partnering with nonprofits and providing them the solutions they need to make a difference in

their local communities and worldwide. Headquartered in the United States, Blackbaud also has operations in Australia, Canada, Hong Kong,

the Netherlands, and the United Kingdom. For more information, visit www.blackbaud.com.


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Documents

2010 Online Giving Report - Blackbaud · Introduction 2010 saw continued growth in the importance of online fundraising for nonprofit organizations. ... peer-to-peer fundraising,