On September 3, 2006, Network for Good processed its 100 millionth dollar in charitable donations. In partnership with GuideStar, the on-line donation portal has released "The Young and the Generous: A Study of $100 Million in Online Giving to 20,000 Charities." The study's major findings are excerpted below.
This study by Network for Good in partnership with GuideStar, the leading database of nonprofit organizations, examines $100 million in giving to provide insights on:
- Who is giving money on-line
- What times of year, week, and day donors give on-line
- How on-line givers spend their charitable dollars
- Why on-line givers choose to give through Internet portals
Finding #1: On-line givers are young, with men and women giving in equal numbers.The median age of donors at Network for Good is 38, with the average between 39 and 40. This is significantly younger than off-line donors, who tend to be 60+ according to most studies. In terms of gender, 52 percent of donors at Network for Good are female. By way of comparison, a number of surveys of overall giving find a slightly higher percentage of women report giving to charity than men.
Finding #2: Donors are not new to giving, but they tend to be new to giving on-line.Nearly all—96 percent—of on-line donors reported having donated to charity before, including via church collection boxes, memberships to nonprofit organizations such as museums, and any other tax-deductible gifts.
A significantly lower percentage—62 percent—report having given to charity on-line before, at Network for Good or any other Web site. That number has fluctuated: in 2003 and 2006, it was 72 percent; in 2004 and 2005, it was 62 percent and 57 percent, respectively. This was most likely because 2004 and 2005 were the years of the Asian tsunamis, Hurricane Katrina, and the Pakistan earthquake, which prompted many first-time donors to give money on-line.
Finding #3: New York and California were the most generous states when total charitable dollars donated were considered, and North Dakota was the least generous by that standard. When the data were evaluated according to population size, the District of Columbia and New York were the most generous and Mississippi the least. Average donation was also analyzed; New York was the most generous by that standard.
Finding #4: On-line donors are generous.Whether due to income levels, the impulsive nature of on-line giving, or the credit card effect, on-line donors give significantly more than off-line donors.
Finding #5: Giving follows a classic long-tailed distribution, with a few well-known organizations receiving half of donations but thousands of smaller or lesser-known organizations combining to account for an equal amount of giving.The "long tail" phenomenon—a term devised by Wired Editor Chris Anderson to describe how the Internet creates and serves long-tailed distribution markets—is evident at Network for Good when numbers of donations are charted by organization. At Network for Good, 50 percent of donations go to 1 percent of charities (excluding crisis giving). The rest is spread out along the long tail. Just as Amazon and Google have enabled consumers to access products and information that meet their particular needs and interests by providing one-stop access to many, diverse choices, Network for Good has enabled donors to contribute to many, diverse nonprofits by putting a fragmented nonprofit "market" in one place.
Finding #6: Disaster relief is the leading category of giving and ranks among top searches; other leading giving categories are international causes, animal-related causes, human services, and education.High volumes of disaster relief giving, such as the $24.5 million in combined giving for the 2004 tsunamis, Hurricane Katrina, and the Pakistan Earthquake, pushed the categories of disaster relief and international organizations to the top of the list of types of charities supported by Network for Good donors. Animal-related charities were third, primarily because of the large number of donations in the wake of Hurricane Katrina, which left many animals stranded.
Human services organizations were fourth in number of donations, followed by education, health, and "public, society," which includes advocacy and technical assistance organizations, professional societies, and research institutions. Religion was a distant tenth and environment fourteenth.
Finding #7: Total on-line donations are fairly evenly divided by size of organization, with half of donations going to small- to medium-sized organizations and half to medium-large organizations. When disaster organizations are removed from the analysis, the proportions shift significantly, with small-medium organizations—many of which use Network for Good to process all of their donations—accounting for about 70 percent of giving.At times of disaster, donors tend to give to large, familiar organizations such as the American Red Cross and Salvation Army. But when humanitarian crises are removed from the equation, it is clear that smaller organizations play a big role in on-line giving. This is not the case off-line. In the nonprofit sector, a small number of large organizations (in terms of annual revenue) account for 1 percent of the organizations but the lion's share of charitable giving. But at a giving portal such as Network for Good, where donors can choose from more than one million charitable organizations, smaller organizations benefit. Similar to the long tail phenomenon at Amazon, where bestsellers may sell many copies but not as many as the sum total of niche titles, Network for Good found that most giving goes to smaller, "niche organizations" rather than big-name organizations.
Finding #8: Donors turn to the Internet at times of disaster and for year-end giving.About 40 percent of giving through Network for Good was in December, when, just as off-line donors, on-line donors do most of their giving because of the holidays and the end of the tax year.
About 30 percent of giving was in response to disasters. The Internet is ideally matched to charitable giving at times of disaster, when technology can turn the impulse to help into a donation within seconds. For example:
- Tsunami: Web traffic 10 times normal volume, donations six times normal volume
- Katrina: Web traffic 75 times normal volume, donations 20 times normal volume
- Earthquake: Web traffic double normal volume, donations double normal volume
Finding #9: People seem to be at their most generous on weekdays, not weekends.Excluding end-of-year and crisis giving, weekdays are when most donors make their contributions. By dollar amounts, Mondays, Tuesdays, and Wednesdays are the days donors are most generous. By number of donations, Tuesdays, Thursdays, and Fridays are top days.
Finding #10: Most donations are made during normal business hours.Donors are most likely to give during the late morning, 10 a.m. to 12 noon. There is a dip in giving at lunch hour, and then giving ticks up slightly in the late afternoon and early evening.
Finding #11: The number one reason donors say they give on-line is convenience: it is easier than writing a check.Donors surveyed by Network for Good say they chose to donate on-line because it is fast and easy. The number two reason was they could give quickly at times of crisis. The other reasons they provided for giving on-line are unique to giving portals such as Network for Good: donors value the ability to give to many different charities in a single transaction, the convenience of storing all their giving records in one place, and the privacy of being able to make donations anonymously.
Read the full report
© 2006, Network for Good