Is your charity fit for this ‘Groupon site for donors’?

January 31, 2011

While listening to CBC Radio One’s Day 6 the other day, I heard about a new website fashioned after the oh-so-popular concept behind sites such as Groupon. Instead of a daily discount deal, however, followers learn about a different charity each day and can choose to donate $1 to the organization. The site is called Philanthroper and in addition to featuring a different charity each day, the organization says that it evaluates each one to ensure that its business practices are solid. The concept addresses three challenges that face charities today.

1. Credibility – People are more skeptical these days about how charities use their funds. There have been cases covered in the media of blatant misuse of funds but there is also growing demand from donors for reassurances their donation dollar is getting results—that the charity is using the funds in the best way possible.

2. Communication – Competition for donor dollars is intense. How the charity tells its story is crucial. The charity profiles on Philanthroper are engaging and vivid and focus on how funds are actually used. Charities need to be better at telling their stories.

3. Accessing the vast number of online donors – The $1 per day donation structure is brilliant. More people are likely to donate–particularly younger donors who don’t have a lot of disposable income. This modal has the potential to build relationships over time and to tap into smaller donations made by huge numbers of people. As the Philanthroper site states, its goal with the $1 maximum donation a day is to make charitable giving a habit. It’s betting that followers of the site will end up donating more over the course of a year this way than if they were asked for the same amount in one shot.

To me, what the site (and others like it that will surely follow) reinforces is the imperative of charities telling credible stories about their causes that stress outcomes. Charities need to be prepared to answer donors’ questions about how the way they choose to spend donated funds relates to desired results. I see too many charities that are vague on this point.

So, would your nonprofit stand up to the scrutiny of a site such as Philanthroper? What do you think the chances are of your charity being featured? Maybe it’s time to fine tune your story.

*Note, Philanthroper is only available to U.S. donors right now but the site has plans to expand to international markets.


2 Responses to “Is your charity fit for this ‘Groupon site for donors’?”

  1. messagecom Says:

    Thanks for the comment, Denzil, and for catching my typos.:)

    The only problem with your scenario is that charities already have administration costs associated with them and your additional 3% may be a turn off to donors who want to see more money go directly to those in need. Not sure if this model would work. Definitely a push from donors, though, for more scrutiny.I think it falls to the charities to be more transparent and better able to communicate demonstrated outcomes.

  2. Denzil FEINBERG Says:

    Morning Deborah:
    I missed the family gathering at Academy for James’ show 2 Saturdays ago, arrived here that morning.

    Typos in your today’s msg: first line: should be listENing and heaRd; you have to be perfect – as you wish, of course!

    Interesting service, Philanthroper.
    Having recomended my researched charities like Rotary, Salvation Army, Jewish Foundation, Winnipeg Foundation and United Way, I have steered many clients to such well-managed low overhead organisations.

    I wish I could get say 3% from the donation like we mutual fund agents can earn from our analysis of funds. We’d research charities with the same due diligence we apply to insurance, investments & taxes etc.

    Deserving charities would get lots more money, we’d earn deserved commissions, fully disclosed to the donors.

    No words were harmed in this message:- in real English “organisations” is with an s…

    Denzil (in Winnipeg -40C)

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