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Charities failing to realise the potential of online fundraising

5 February 2015

  • Only 2% of charities feel they are ‘maximising online fundraising as a donation channel’
  • Over 50% feel they are failing to making the most of online fundraising
  • While 10% of charities do not use online fundraising at all

Research by Virgin Money Giving, in partnership with Third Sector Insight, has revealed that charities across the UK are not maximising the potential of online fundraising.

Virgin Money Giving, the not-for-profit online fundraising service from Virgin Money, worked with Third Sector Insight, the voluntary and community sector fact-finding and analysis service, to determine the current position. The work included a survey of more than 550 charities, operating in areas as diverse as children and youth services, animal welfare, health and overseas aid. The resulting Virgin Money Giving and Third Sector Digital report reveals:

  • Only 2% of charities feel they are maximising online fundraising as a donation channel
  • More than half (52%) of respondents believe they are not making the most of online fundraising
  • Almost 10% of charities do not use online fundraising at all
  • Close to 8 out of 10 charities say online fundraising accounts for less than 20% of annual donations
  • 36% of the largest charities in the survey, with turnovers in excess of £250 million, receive less than 1% of their income digitally
  • Even among charities that are generating a significant income stream from online fundraising, most believe there are more opportunities to be exploited

The reasons why charities are reluctant either to embark on online fundraising, or expand their online presence, can be distilled into three areas - a perceived lack of online expertise, a feeling that online fundraising can be impersonal, and cost:

  • Almost 73% of those who said they don’t currently fundraise online said they see their internal digital capabilities as a challenge or a major challenge
  • Just over half of respondents either agree or strongly agree that online fundraising can be impersonal, and 4 in 10 respondents disagree that it’s easy to build a relationship with online donors
  • Worries over set-up costs for online fundraising are a particular concern for smaller charities and a third of charities with a turnover of under £500,000, cite set-up costs as a major challenge for them

But there are some who embrace online fundraising and feel that such fears are misplaced.

Ben Robinson, Community Fundraising Manager at Cardiac Risk in the Young, says:“Online fundraising has come to the forefront as the lead way for our supporters to raise money. We feel it’s been of massive benefit to us and behind much of the growth in donations we’ve experienced in recent years.

“To maximise the fundraising potential for charities using online fundraising, obviously a bit of online expertise is very helpful, but online fundraising partners, such as Virgin Money Giving make it very simple for both the charity and the fundraiser so you don’t need any web design ability to get up and running.”He adds that Virgin Money Giving provide help desk support, “responding quickly to our questions and helping however they can”

Others feel that concerns over the impersonal nature of online fundraising and cost can also be challenged.

Andy Sloan, Partnership and Events Manager at Walking with the Wounded:“You can engage with a much wider audience with a few clicks. I understand that people still like receiving letters, but you can have a very personal relationship with people using online tools because you can be in more regular contact, sharing photos and videos. There is a lot more engagement which makes them feel part of something unique and rewards their effort in fundraising for us.” Sloan added that online fundraising “significantly reduces the costs of reaching out to people. You can engage with a much wider audience with a few clicks and bring down print costs and overheads.”

The report also draws upon research by digital skill charity Go ON UK, which found that 66% of charities had reduced their operating costs since beginning to fundraise online. And because of Virgin Money Giving’s not-for-profit status and low-fee structure, charities can benefit further.

Jo Barnett, Executive Director at Virgin Money Giving said:“We hope this report will encourage charities of all sizes to feel more confident about using online fundraising and the support we can give them, not only to start fundraising online but to maximise their impact by helping them to personalise their content, reach more people and fundamentally – raise more funds for those who need it.

“Our not for profit pricing structure means that over £10 million more has reached our charity partners since we launched just over five years ago, compared to our closest competitor1.”

In the past year Virgin Money Giving has launched new functionality to further support charities in maximising online fundraising. An example is its new “Someone Special” function – which builds on traditional in-memory fundraising by offering greater flexibility for fundraisers and campaigns.


ENDS

1Figures based on a comparison of the cost of service and transaction costs of Virgin Money Giving with JustGiving, based on Virgin Money Giving’s fundraising total from its launch to 31 October 2014.


Media Contacts
Virgin Money Giving press office
0191 279 4676
press.office@virginmoney.com

NOTES TO EDITORS

About Virgin Money Giving

  • Virgin Money Giving is the not-for-profit online fundraising arm of Virgin Money and was established in 2009. Virgin Money uses its infrastructure and expertise as a financial services business to ensure that Virgin Money Giving is efficient and secure
  • Virginmoneygiving.com is free for fundraisers, charges a flat registration fee of £100 + VAT for charities and a 2% fee on all donations before Gift Aid. For every £10 raised, charities receive £12.15. Virgin Money Giving charges charities the minimum fees needed to cover the running costs of the site. Any profit achieved after covering operating costs will go towards reducing fees further or improving services for fundraisers and charities
  • Fundraisers can personalise their fundraising pages, send out email alerts and manage their fundraising events. They can include their own content, photos and links to their page as well as customise messages for their supporters. Fundraisers can also link their page to social networking sites. Virgin Money Giving also contains fundraising ideas and tips, offering help and advice to fundraisers on how to raise more for charity
  • Virginmoneygiving.com is the official fundraising partner of events that include the Virgin Money London Marathon, Royal Parks Half Marathon, Nike Run to the Beat and the Virgin Money Cyclone