Although we often think of philanthropy in terms of large donations made to charitable organizations by wealthy or long-standing supporters, giving has changed recently for a couple of reasons:
- Economic uncertainty has made it difficult for many donors to sustain their historic levels of giving
- Younger givers are often cash-poor or burdened with student debt
But cause-related donations are still happening; they’re just more likely to happen in small amounts. This is especially true with younger donors who’ve adopted a new way of giving known as microphilanthropy.
If your nonprofit struggles to hit fundraising targets, it may be worth embracing microphilanthropy to supplement your revenue stream in uncertain times and beyond.
What is microphilanthropy?
Also known as micro-donating or micro-giving, microphilanthropy is the gifting of smaller donation amounts ranging from $0.25 to $25.
Microphilanthropy refers to charitable actions involving small financial contributions from individuals to support various causes, projects, or people in need. Unlike traditional philanthropy, which often involves large donations, microphilanthropy leverages the collective power of many small donors to make a significant impact.
Key features of microphilanthropy include:
- Accessibility: It allows anyone to become a philanthropist, regardless of the size of their contribution.
- Online Platforms: The rise of the internet and social media has facilitated microphilanthropy through crowdfunding sites like GoFundMe, Kickstarter, and Kiva.
- Direct Impact: Donors often have a direct line of sight to the impact of their contributions, sometimes even communicating with beneficiaries.
- Community Engagement: It fosters a sense of community and shared purpose among donors who support similar causes.
Microphilanthropy has revolutionized the way people contribute to charitable causes by making philanthropy more inclusive and engaging. It empowers individuals to support projects they are passionate about, no matter how small the donation.
While small in size, microdonations can add up quickly enough to make a real difference to your organization. It’s because the amounts involved are so minor, in fact, that most people don’t think twice about donating when the opportunity arises.
Why microphilanthropy is gaining in popularity
From Facebook fundraisers to text-to-give appeals, advances in mobile and financial technology have enabled new charitable channels that make it easy to adopt a microphilanthropy mindset.
With a simple smartphone app, for example, donors can feed a hungry child for less than a dollar a day or support their favourite charity by rounding up their daily purchase amounts.
But credit card fees for donations can be high at $0.30 per transaction. But with the help of payment processing solutions like Stripe and Rotessa’s pre-authorized debits, your nonprofit can reduce transaction fees enough to make smaller donations worthwhile.
And because the barrier to entry with microdonations is so low, they’re particularly appealing to younger generations who appreciate the way microphilanthropy:
- Democratizes giving, especially at the grassroots level (meaning they don’t have to be wealthy to make a difference)
- Allows anyone, regardless of socioeconomic status, to support the causes they care about
Donor demographics have changed
Not only are millennials now the largest generation in Canada (at 27% of the population), but as digital natives, they’re active on social media and often care a great deal about fairness and equity. Some of the main factors changing the landscape include the following.
- Shifting Trends: As this population ages, there is a natural concern about the sustainability of donation levels. Nonprofits are looking to engage younger generations to fill this potential gap.
- Cause-Oriented Giving: Younger donors are more likely to support specific causes rather than organizations. Issues like climate change, social justice, and mental health resonate strongly with them.
- Different Giving Practices: New Canadians may support both local and international causes, sometimes sending remittances abroad or supporting community initiatives within their cultural groups.
- Online Donations: The rise of digital platforms has made donating more accessible. Mobile giving, online campaigns, and social media fundraising have lowered barriers to entry.
- Economic Uncertainty: Factors like housing affordability and student debt affect younger Canadians' capacity to donate.
- Strategic Giving: Donors are becoming more strategic, seeking transparency and measurable impact from the organizations they support.
In a nutshell, the donor landscape in Canada is evolving due to demographic shifts, technological advancements, and changing societal values. Forward-looking nonprofit organizations are adapting by:
- Engaging Younger Donors: Developing strategies that resonate with younger generations, such as leveraging social media and demonstrating tangible impact.
- Embracing Diversity: Tailoring outreach to reflect the diverse cultural backgrounds of Canadians.
- Enhancing Transparency: Providing clear information on how donations are used to build trust with donors.
Here is an excellent example of the new way of giving in action. When CanadaHelps launched the Black Solidarity Fund (BSF) during the Black Lives Matter movement in 2020, more than half the 3900 donations received were from younger, newer donors who gave generously enough online to help the BSF raise nearly $1.9 million.
Microphilanthropy benefits
One of the biggest benefits of microphilanthropy is how it allows nonprofits to reach new donors and diversify their fundraising strategies.
Connect with new donors. Expanding fundraising efforts beyond your traditional audience and donation appeals can help you connect with an entirely new generation of donors.
By engaging in more initiatives that appeal to the microphilanthropy-minded (like crowdfunding, peer-to-peer campaigns, or fun, collaborative events that help givers connect directly with your mission), you can:
- Grow your donor database
- Diversify your revenue model
- Encourage the kind of interactions that solidify long-term giving relationships.
Broaden your fundraising approach. Taking an eggs-in-one-basket approach to fundraising increases the risk that an unexpected event will negatively impact your single-sourced revenue.
Rather than relying predominantly on GivingTuesday fundraising activities, for example, you can use microphilanthropy to supplement your revenue throughout the year. The more giving channels your NPO has, the more regular and reliable your organization’s income will likely be.
How to get started with microphilanthropy
To get started with microphilanthropy, you should first examine your current giving channels to determine which donation streams you’ve yet to tap into.
Since one of the best ways to reach the demographics most likely to make microdonations (i.e., millennial and gen Z individuals) is through email or social media, you may want to create a social media strategy that educates younger donors on the impact of their donations. It can also be worth exploring peer-to-peer or crowdfunding campaigns as a way for donors to involve themselves in your fundraising efforts and help amplify your message. Let's look at tactics in more detail. Use some or all of these tactics to launch your microphilanthropy campaigns.
1. Embrace Digital Platforms
- Online Donation Tools: Utilize user-friendly online platforms that facilitate small donations. Examples include embedding donation buttons on your website or partnering with platforms like PayPal Giving Fund.
- Crowdfunding Sites: Launch campaigns on crowdfunding websites such as GoFundMe, Kickstarter, or Indiegogo to reach a wider audience.
2. Leverage Social Media
- Engaging Content: Create compelling stories and share them across social media channels to inspire micro-donations.
- Hashtag Campaigns: Use specific hashtags to increase visibility and encourage community participation.
- Live Streaming: Host live events or Q&A sessions to interact directly with potential donors.
3. Implement Mobile Giving
- Text-to-Give Campaigns: Allow donors to contribute via SMS, making the process quick and convenient.
- Mobile Apps: Develop or utilize existing apps that enable easy, recurring micro-donations.
4. Offer Recurring Donation Options
- Subscription Models: Encourage donors to set up automatic, small monthly donations, providing a steady income stream.
- Membership Programs: Provide exclusive content or perks to recurring donors to enhance engagement and loyalty.
5. Simplify the Donation Process
- One-Click Donations: Reduce barriers by allowing donors to give with minimal steps.
- Multiple Payment Options: Accept various payment methods, including credit cards, digital wallets, and bank transfers.
6. Personalize Donor Engagement
- Thank-You Messages: Send personalized acknowledgments to make donors feel appreciated.
- Impact Reports: Share updates on how their contributions are making a difference.
7. Utilize Peer-to-Peer Fundraising
- Empower Supporters: Enable volunteers and supporters to create their own fundraising pages to collect donations on your behalf.
- Social Sharing: Encourage donors to share their contributions on social media to inspire others.
8. Collaborate with Influencers
- Micro-Influencers: Partner with influencers who have a strong connection with their audience to promote your cause.
- Affiliate Programs: Offer incentives for influencers who drive donations to your organization.
9. Host Virtual Events
- Online Fundraisers: Organize webinars, virtual concerts, or workshops where attendees can donate.
- Gamification: Introduce challenges or competitions to make giving more interactive and fun.
10. Target Younger Demographics
- Platform Selection: Focus on platforms popular with younger audiences, like Instagram, TikTok, or Snapchat.
- Cause Alignment: Highlight issues that resonate with younger donors, such as environmental conservation or social justice.
11. Enhance Transparency
- Open Communication: Be transparent about where donations go and the impact they have.
- Real-Time Updates: Use progress bars or live feeds to show ongoing fundraising efforts.
12. Engage Corporate Partnerships
- Matching Gifts: Partner with companies willing to match employee donations.
- Payroll Giving: Encourage businesses to allow employees to donate directly from their salaries.
13. Optimize SEO and Online Presence
- Keyword Strategy: Use relevant keywords to increase visibility in search engines.
- Content Marketing: Publish blogs, articles, and videos that draw attention to your mission and encourage donations.
14. Utilize Email Marketing
- Newsletter Campaigns: Regularly update subscribers about your work and how they can contribute.
- Segmentation: Tailor messages to different donor groups based on their interests and giving history.
15. Provide Incentives
- Merchandise: Offer branded items or digital downloads as a token of appreciation.
- Recognition: Acknowledge donors publicly (with their consent) to encourage ongoing support.
Benefits of Shifting to Microphilanthropy
- Broader Donor Base: Attract individuals who may not have the means for large donations but are willing to contribute smaller amounts.
- Increased Engagement: Frequent small donations can lead to higher overall engagement and donor retention.
- Community Building: Creates a sense of collective effort and shared mission among supporters.
Challenges and Solutions in Turning to Microphilanthropy
- Administrative Overhead: Managing numerous small donations can be resource-intensive.
- Solution: Automate processes where possible and use donor management software.
- Donor Retention: One-time small donors may not return without proper engagement.
- Solution: Implement follow-up strategies to keep donors informed and connected.
Implementation Steps for Microphilanthropy Campaigns
- Assess Organizational Capacity: Ensure you have the infrastructure to handle increased online activity and donor communication.
- Set Clear Goals: Define what you hope to achieve with microphilanthropy in terms of revenue and donor engagement.
- Train Your Team: Equip staff with digital fundraising and donor relations skills.
- Pilot Programs: Start with a small campaign to test strategies and learn what resonates with your audience.
- Gather Feedback: Use surveys and analytics to understand donor behaviour and preferences.
Measuring Success of Microphilanthropy Campaigns
- Key Performance Indicators (KPIs): Track metrics such as the number of new donors, donation frequency, average donation size, and overall revenue growth.
- Donor Feedback: Solicit input to improve future campaigns and strengthen relationships.
No matter which micro-giving avenues you leverage, microphilanthropy is a great way to round out—rather than replace—your nonprofit’s traditional fundraising channels. Why not explore its potential for reaching new audiences, fostering long-term donor relationships, and ultimately building out your revenue stream?
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