New technologies for giving

The charitable sector faces the dual challenge of decreasing government funding and greater pressure on services, while charitable giving among the public is not showing the necessary increase to make up the shortfall. Indeed, 18% of the British public say the amount of money they donate to charity has decreased in the past few years.

With three quarters of registered charities across the sector receiving income from donations and fundraising activities there is clearly much to be gained from exploring how new technologies might impact on the funding environment. Four-fifths of British adults are now connected online, with over two-fifths ( 45%) owning a smartphone. A similar proportion ( 44%) have visited Facebook and YouTube in the past three months.

Ipsos Mori conducted quantitative research to set a benchmark for the public’s current use of new methods of donation. As might be expected, usage is fairly low:

• 14% have donated via an online sponsorship site
• 12% online via credit or debit card
• 7% by text
• 5% via a mobile-based giving site
• 2% by Round Pound
• 0% by ATM Giving

Naturally, usage will be limited by availability. But more concerning is that while the majority of those who have used each method say they would be willing to do so again, those who haven’t show low claimed likelihood-to-use in future. So while technology is very much a part of people’s lives, it will require a fundamental change of mindset to encourage the public to adopt new methods of giving.

Digital development

It’s clear that new technologies are not a motivator for giving in themselves, but rather a facilitator when accompanied by an effective call to action – be that a poster campaign including a text donation prompt or the behavioural economics-inspired Round Pound schemes or ATM donations.

There are many examples of this in practice. Charities Aid Foundation identified that during the December 2004 tsunami appeal, 61% of online donors said this was the first time they had donated online. Martha Payne’s ‘NeverSeconds’ and Alice Pyne’s ‘Bucket List’ are great examples of new technologies for sharing engaging and emotive stories (i.e. an effective call to action) and harnessing this call to action within seconds (by providing a link to make an online donation).

But new technologies stand to have the most impact by providing charities with an opportunity to engage younger audiences who have traditionally been less likely to donate. RS Consulting conducted qualitative research on attitudes to giving among Generation Y consumers – broadly those born between 1980 and 2000 (give or take a couple of years either side).

The research focused on those born 1980–1990, now in early adulthood and with the autonomy and independence to make active decisions about donating both time and money to charitable causes. At around 15% of the UK population, this is a cohort of increasing power and influence in all walks of life.

If the 21st Century is the digital age, then Generation Y are digital natives. Over 80% own a smartphone. They inhabit an ‘always-on’ culture of instant gratification; a world which is in constant flux and in which they collaborate and participate to shape and develop according to their needs and desires. This attitude is reflected in everything from customised clothes and technology products to the demise of the package holiday – 74% of Gen Y agree that they like to customise products and experiences.

Giving money – and opinions

The challenges faced by this generation in terms of employment, getting onto the housing ladder and student debts are widely reported, making it unsurprising that while half would like to commit to supporting a charity on a regular basis, the majority do not – and the proportion of 26–30 year olds giving to charity has decreased over the last 20 years. A lack of time, money and personal connection to a cause are among the most commonly cited reasons for not giving.

However, we can see that Gen Y is doing its bit for charity by engaging with new technologies for giving and driving the micro-donation trend. 19% say they have donated by text, 20% have shared a charity message via social media and 10% have donated when purchasing on eBay. These methods of giving appeal for their simplicity, their flexibility and because it is one of the most natural means of engagement for this cohort.

What is also clear is that for this generation, new technologies are expected to go beyond being a means for giving, and be a primary channel for two-way communication between charities and their donors. The expectation is that charities will harness the capabilities of SMS, MMS, apps and online content to inform and collaborate with them. Gen Y want to see close to real-time footage of aid on the ground in Africa in much the same way that they can see real-time footage from the front lines of war. They also want to have their say in how money is raised and spent, reflecting their experiences of online social networks where traditional hierarchies and business-to-consumer relationships are blurred.

The charity sector should be prepared.

Sally Panayiotou is head of charities research at Ipsos Mori and Victoria Boelman is associate director at RS Consulting