Facebook Causes Continue to Show Little Promise as Fundraising Tool

In April 2009, the Washington Post riled up the nonprofit blogosphere by stating that Facebook Causes was ineffective for fundraising.

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/21/AR2009042103786.html

At the time,the Nature Conservancy was  one of 3 organizations that had raised over $100,000 on their Cause page.  At that time, there were roughly 80,000 'people' on The Nature Conservancy Cause page. That's an average of $2.40 generated for the nonprofit per member.  That's not so great and it's understandable why the Washington Post came to the conclusion that it did.

Today, nearly a year and a half later, I found myself talking to a client who wanted to know how much of their resources they should invest in Facebook Causes.  My gut feeling was to say, 'none at all' because  there's no data showing that a Cause page actually helps your organization in any way.  But I held back, because I didn't want to seem like an old-world curmudgeon. 

So, I went back  to  the Nature Conservancy Cause page.  Today, they have 286,000 members and have raised nearly $388,000!  Sounds great, right? That's about a $1.36 per member.  Thats pretty awful.  That's DOWN over 40% since the Washington Post article in August 2009.

At Blue Sky we've seen small groups of 80 or so people generate over $388,000 over the course of a few months for very small nonprofits.  That fact that a behemoth like The Nature Conservancy shows such poor results on their Cause page leaves very little hope for the small to mid-size organization on Causes.  You can bet that The Nature Conservancy is dumping millions of dollars in resources to their Cause page annually.  To what end?  I'm not sure, but its not for revenue.

I know that the marketing folks won't like my stance.  They will tell me about all the abstract value that Causes has but I'm a numbers and data guy. And if the time and money invested into a Cause page can not be converted into real revenue or savings then what's the point?

If I were a nonprofit manager, I would think twice before investing more time and money into Causes.  

Comments

[Ken Goldstein]

I think you're looking at the wrong numbers. Whether they've raised $1.36 or $2.40 per current "member" is insignificant.

I want to know how much did they spend to raise the $388,000? Was that from current donors who gave through Facebook rather than their mail appeal? Or was a significant amount of that from new donors?

The cost of acquisition per donor is an important part of deciding whether or not the Facebook strategy is paying off. Obviously, if it's more than $1.36 then there better be some other value for the organization using Facebook Causes other than the income.

But, I'm willing to guess that the the cost per donor is quite small, and, once the Causes page is up and running, the marginal cost for each additional donor acquired goes down.

I'd love to hear from somebody from the Nature Conservancy with more data, and whether or not they feel they've gotten a good ROI from Facebook Causes. They're no bunch of dummies. I'm guessing they've done the analysis and are satisfied.

[Syam Buradagunta]

Thanks for the thoughtful comment. You've raised a great question. How much are they spending on their Causes page? What do you think? An FTE for 3 years or so? Perhaps they spent $150K to raised that $388K? If so, that's not efficient.

The whole attitude around Causes baffles me. It's a marketing tool. Marketing should lead to sales/donations and revenue, right? The fact that intelligent folks like yourself and the people at Nat. Conservancy would deem revenue insignificant is difficult to believe and is somewhat baffling. Somebody please explain this to me. Am I too fixated on the bottom line? Am I the only one who is skeptical? I agree with you. Someone at Nature Conservancy, needs to tell us what they've gained from your Causes page. My MBA is telling me that it wasn't a good investment at all. Thanks again, Ken.

[Lasting Power of Attorney]

The essential point, is that Facebook was never designed as a fundraising tool.

[computer service orange county]

They are social networking sites - so it will help you network with friends and family. Not a fund raising sites.