Social Media and the Future of Fundraising

There is an interesting post on Peter Deitz’s blog about how social media is changing the future of fundraising.  Peter is the founder of Social Actions a US/Canadian nonprofit clearinghouse of social causes.  They use social media to spread the word and engage people in various social issue organizations.

Peter argues that the growth of social media (everything from Twitter, Facebook, MySpace, Flickr, etc.) is dramatically changing the way nonprofits will successfully raise money in the next 4 years.  He argues that the presidential campaign tactics, fundraising and measures of success shifted fundamentally from 2004 to 2008, largely because of the growth and use of social media.  Obama won the presidency because of his team’s efficacy with Facebook, MySpace, Twitter, online fundraising, etc.

Peter argues that by 2012 nonprofits that are still raising money in traditional, i.e. non-social media, ways will find it significantly more difficult to reach their goals:

Current best practices will serve nonprofits just fine in 2009. Between email solicitation, direct mail, major donors, and grant-writing, the vast majority of nonprofits will weather the economic hard times. But a shifting communications environment and changing donor demographics could render those best practices ineffective at best, and obsolete at worst, as early as 2012.

He definitely has a point.  Nonprofits need to be actively engaged in the social media world.  And I agree that donor engagement and investment will increasingly move into that space.  But I don’t agree that traditional practices, especially major donor cultivation, solicitation and stewardship, will become obsolete.  Rather, I would argue that nonprofits, as always, should diversify their fundraising activities, in order to strengthen their fundraising function.  Whenever someone argues that traditional models are gone, I am reminded of the dot com evangelists who spoke of the death of the traditional business model, i.e. where valuation is based on actual profit.  Yeah, that traditional model is still around somehow.

That being said, however, I do think Peter, and Beth Kanter, a social media consultant to nonprofits, who commented on his post, do have some good advice for nonprofits in the social media space.  Nonprofits absolutely need to be actively engaged in social media and working to add social media strategies into their fundraising mix.

Peter has 5 tips for nonprofits in order to move them further into the social media world:

1. Use social media to communicate with all donor groups, not just the young.  People across the spectrum are using Facebook, MySpace, etc., so make sure your communications in those arenas have that in mind.  Don’t assume your audiences there are just young people.
2. Create and participate in online contests in order to understand who is following your organization online.
3. Make hiring decisions based on social media knowledge.  He argues that “you are better off hiring people who are at home online than trying to make them that way after they’ve been hired.” I disagree with this.  Since social media is so new, we are all learning what it is and how to use it.  There are no social media experts.  It is far better to hire someone who understands and has experience in fundraising overall and can learn about social media as another tool.
4. Use your interns for ideas about engaging in the social media landscape.  A great idea.
5. Get an iPhone, or other mobile device.  If you truly want to be part of the “always on” social media world, you have to go mobile.

In her response to Peter’s post, Beth Kanter discusses a new Twitter application, Twitpay, that allows people to donate to organizations and causes via a PayPal-like extension of Twitter.  You simply Tweet your donation amount to your intended recipient, in any amount under $50.  Now that’s a great and interesting use of social media in the fundraising world.

Social media is a very exciting space for nonprofit fundraisers.  And they absolutely should embrace it and add it to the mix as a further way to engage and invest donors more deeply in their organizations.  But I really don’t see social media ever completely replacing one-on-one fundraising.  Fundamental to fundraising is the individual relationships that develop between a donor, the organization, and the person making the ask.  Social media can certainly expand the reach of an organization and deepen relationships, but I doubt it will ever completely replace traditional models.

Tags: Fundraising, social media