Online Fundraising Platforms

Whether it’s for an annual appeal, capital campaign or special event, nonprofits in every sector use online fundraising tools to collect donations and connect with supporters. In fact, according to a report on charitable giving, online donations accounted for nearly 7 percent of all contributions in 2014: an 8.9 percent increase over the previous year.

With this guide, you can learn more about how online fundraising platforms can help you handle these important donations.

Here’s what we’ll cover:

What Is Online Fundraising Software?
Common Functionality of Online Fundraising Systems
Key Considerations for Comparing Products
Case Study: Click & Pledge Online Fundraising Software

What Is Online Fundraising Software?

Online fundraising tools power online donation processing. When users arrive on a website’s donation page, they enter credit card billing, contact and other information into an online donation form. When the information in that form is submitted, the credit card is validated and charged.

When processing is complete, the system typically sends donors to a confirmation screen and emails them a tax receipt. At the same time, the funds are electronically deposited in the nonprofit’s merchant account, minus processing fees.

Then, donor and contribution details can be reviewed and analyzed using reporting functionality. Reporting tools may be built into the online fundraising system, or users may choose to export the data and use different software.

Some online fundraising tools are more comprehensive, allowing users to:

• Customize donation forms, such as the visual design, URL and donation amounts
• Add custom fields to handle “in memoriam” donations and other unique data, including gifts targeted to a specific program
• Automatically track and process recurring donations and pledges
• Process payments using multiple methods, including credit card, PayPal or electronic funds transfer (EFT)
• Create peer-to-peer (P2P) fundraising pages that allow supporters to solicit donations from their friends, groups and social networks
• Accept and process text-to-give donations

Common Functionality of Online Fundraising Systems

Products can vary from vendor to vendor, but certain capabilities are offered by most systems. The most common are described in the table below:

Key Considerations for Comparing Products

Nearly all online fundraising products let users create custom donation forms, process payments and acknowledge supporters. Here are five other factors to consider when comparing products.

Processing fees. Online fundraising platforms charge transaction and processing fees for each donation. The fee is either a flat rate (e.g., 30 cents per donation); a percentage of the total donation (usually between 1.5 percent and 9 percent); or a combination of both. Some vendors also charge a monthly or annual subscription fee to use the software, whether donations are processed or not.

Social fundraising. Social (or “peer-to-peer”) fundraising functionality is built into many online fundraising systems. It lets supporters create and personalize campaign pages and share them with their friends through social media and email.

If your nonprofit hosts events or uses social fundraising in its campaigns, look for products that specialize in peer-to-peer fundraising and that support individual and team fundraising pages.

White label capabilities. If you’ve made online donations, you’ve probably noticed that some websites redirect you to a donation form on a different URL that doesn’t match the look of the rest of the site. This confuses supporters and can reduce a nonprofit’s trustworthiness. To prevent this, some products let users control the HTML and styles on the page, so donation forms match the core website.

If your nonprofit wants to accept donations on its website, look for “white label” or “custom donation pages” in the vendor’s features and benefits lists. Keep in mind that the skills of a Web designer or developer might be needed for this purpose.

Constituent relationship management (CRM). When someone makes a donation on a fundraising page, the system should automatically email a receipt to the donor. But most nonprofits want to build a relationship with supporters beyond this interaction. If this applies to you, look for systems that retain donor information.

Find out if the online fundraising platform lets you export donor information, or if it integrates directly with a best-of-breed donor management system. This allows your organization to track interactions and communicate with those donors in the future.

Usability. “Usability” refers to how easy it is for people to learn and use a product. If software is confusing and hard to use, employees won’t use it. So it’s important to find a product that is simple enough for everyone in an organization to understand—no matter what their technical ability.

Case Study: Click & Pledge Online Fundraising Software

To learn more about how online fundraising platforms can help improve operations, consider the case of Immigration Equality, a New York-based legal services nonprofit that advocates for lesbian, gay, bisexual, transgender (LGBT) and HIV immigration rights. The organization realized many benefits after implementing the Click & Pledge online fundraising system.

In this case study, we explain how the software improved inefficiencies in the organization’s donation forms, multiple payment accounts and donor management tasks.