Trendspotting
February 23rd, 2005 at 11:29pm
Under Trendspotting
In his book SmartMobs, Howard Rheingold describes the ” shadow of the future” as an important factor in building trust within online trading communities like eBay. In the unregulated world of the Internet, trust is an essential foundation for all online transactions, including making online donations to charity.
Rheingold describes how Ebay’s trust system works by creating a “shadow of the future” in which
the expectation of dealing with others in future interactions … influences behaviour in the present.
The way it works, if a buyer or seller are happy with a transaction that they have participated in, they can give that person a credit (+1) , or they can give a penalty (-1) if they are unhappy. Over time, the best, most-trusted traders accumulate a lot of credits (+’s) which serve as indicator of their ‘trusted reputation’ when they encounter new prospective traders.
The idea that relationships of trust are built over time, and that actions in the present affect attitudes in the future are not new. But what is happening in these online communities is that those qualities of “trust” and “reputation” are being codified and made transparently available for all to see - and to base their decisions on.
Reputation systems are an emerging phenomenon on the internet and they are a feature on numerous on commercial websites, in the form of “user ratings” and “user reviews” for products and services. Increasingly online shoppers are able to rely on “word of month” and recommendations from other customers as factors in their purchasing decisions.
It may not be long before we see reputation systems being used to help people make decisions about which charities to support — based on “user reviews” of each organization’s record of doing good work with the donations they receive.
This may not be a bad thing for many charities. Reputation is a foundation stone of all nonprofits and is the strongest currency they have with their supporters. Individuals who open their wallets and make a donation to an organization are doing so because of their high regard for that organization’s reputation. As “satisfied customers”, donors would be the natural spokespeople to provide “user credits” (+’s) in a charity reputation system.
We may never actually see the emergence of online charity reputation systems, but nonprofits can start using reputation-based strategies right now by engaging their loyal supporters as spokespeople.
Donors can be encouraged to tell others about what motivated them to donate, and to make recommendations to their friends, relatives and colleagues to do likewise. As well, having a donor testimonial web page on your website provides supporters the opportunity to post their “user review” of the organization they have chosen to support, and in that way encourage others to do so as well.
Turning your donors into spokespeople for your cause can be an important means to capitalize on your good reputation and expand your supporter base.
By irishg
February 20th, 2005 at 08:52am
Under Trendspotting
Many nonprofits rely on small-donor fundraising, and much of that fundraising is done using direct response techniques. We’re all familiar with the format - a letter or phone call from an organization telling you how important their work is, and asking you to make a donation to support them. Direct response fundraising is a long-standing practice that many fundrasers (myself included) continue to rely on. However, it’s not the only way for nonprofits to engage their donors.
Alex Steffen posted a commentary recently on the worldchanging.com site reminding us all how limiting, and at times insulting, direct response fundraising can be. Here’s an excerpt:
Right now, most advocacy NGOs consider their members like you and me mostly as a source of small donations. By and large, they couldn’t care less what we think, how we act, who we know and how strongly we’re committed, as long as we keep writing those $35.00 checks for our “memberships.”
Ouch. The truth hurts sometimes …
The Howard Dean campaign for the US democrat nomination was one of the first large successful demonstrations of how things could be done differently by applying a social network model to standard fundraising practice. What was so interesting about the Dean campaign fundraising? It was the way that many of the donation pitches were delivered - from one friend or family member or colleague to another - using online word-of-mouth (word-of-mouse?) and peer-to-peer fundraising tools that made it easy for individuals who were committed to the campaign to go out and round up more donations from within their own social networks. Both the Kerry and Bush campaigns made extensive use of online social networking tools for fundraising and also for Get-Out-the-Vote (GOTV) efforts.
Social network fundraising is being used in non-political fundraising as well. One example is the Night of 1000 dinners, where private individuals use an online registration and invitation tool to hold a fundraising dinner party in their own home and invite their friends, family and neighbours to join (and make a suggested donation to support the global anti-landmine movement). It has also been used successfully in charity marathon/walkathon events.
Social Network Fundraising is a powerful fundraising model because it super-charges the “pitch” - it adds the power of the personal relationship between the “asker” and the “askee” on top of the message being presented by the organization, and in fact, many of those donations to the Dean campaign were likely made not because of the campaign message in itself, but rather because of the messenger who delivered it.
It makes sense when you look at psychological and social models of how people form political opinions and loyalties to causes — we rely very heavily on the influence of our peers and immediate social circles - so when a campaign/advocacy/fundraising message originates from within those relationships - it’s very hard to resist.
In fact, relationship fundraising (which is another term being applied to this kind of approach) is not new at all - it’s an old model of fundraising that was in widespread use when people lived in communities where you actually knew your neighbours and had regular contact with other people in your immedate surroundings. My mother, for instance, used to be a volunteer with the “Mothers who March” and raised money each Easter for the March of Dimes. She went door to door around the town, talking to friends and neighbours and asking them to make donation. And by all accounts she was a pretty convincing fundraiser — well known in the community, and a prominent member of the local United Church. I can’t help but think that when the March of Dimes centralized all their fundraising in the 1970’s and started relying on direct mail and telephone appeals, that they lost a powerful salesperson…
By irishg
February 16th, 2005 at 01:05pm
Under Trendspotting+ fundraising
One of the lessons for fundraisers in the aftermath of the Tsunami is to look at what triggered the huge global giving response. Why did the urge to donate to this particular disaster catch on and become so big, so quickly, all around the world?
In his book The Tipping Point, Malcolm Gladwell considers how big social ideas and trends get started and how they “tip” - specifically, how they cross a certain threshold where they catch on and then spread quickly throughout our culture.
In brief, Gladwell suggests that three rules of social dynamics play a critical role in making a social phenomenon “tip”:
1. Law of the few: Like the spread of disease epidemics, a new social trend can be triggered by a small number of individuals who are able to effectively package an idea and deliver it to the best audience in a form they can understand.
2. Stickiness: For an idea to catch on it must have a memorable quality - it must stick in the audience’s mind. It should have an emotional “hook” as well as a rational meaning.
3. Context: The environment in which an idea is embedded plays a important role in launching a social trend. It’s about being in the right place at the right time. Small shifts in the context can make the difference in whether an idea becomes big, or remains small.
The global Tsunami giving response is an excellent example of an idea or “meme” that tipped. Here are my own Gladwell-inspired thoughts on why the Tsunami disaster became a global flash philanthropy event
1 - Law of the few: The world started seeing reports and images from the tourist resorts in Thailand within hours of the Tsunami. These tourists were able to quickly get reports of their personal experiences of the disaster out into the world’s media. They had the tools (video cameras, mobiles phones), and the connections to make this happen much more quickly than if there had been no tourists affected. By comparison, the news of the full scope of devastation from Aceh took nearly two weeks to get out.
2 - Stickiness: Those film clips and personal accounts of the disaster from tourists were exceptionally compelling, and framed the disaster in the form of a personal experience that the middle-class global media audience could identify with.
3 - Context: Over the past few years ecommerce has moved into the mainstream, and that has been accompanied by the development of online giving tools by many NGOs and charities. However, online giving has not yet been widely adopted by donors (online giving currently makes up only a small percentage of the total money raised by most organizations through traditional direct mail/telephone/etc.) so I thnk that the potential for a massive unleashing of online giving had been building - just waiting for something to release it.
I also want to add that as an online fundraiser by profession, I can’t help but think we haven’t been doing a good enough job of tapping into the growing potential of online giving. We should be redoubling our efforts to engage potential donors and motivate them to give.
We have now seen that it can happen on a massive scale when everything comes together correctly.
By irishg