Interesting update on Mobile Giving from Philanthropy Journal today.

Nonprofits find texting tough way to raise money

While the Red Cross raised over $30 million by mobile phones after the Haiti earthquake, triggering a rush by nonprofits to try to raise money through text-messaging, reproducing those results has been tough for most groups, often because the costs of supporting a mobile-donating program can outstrip the returns, The New York Times reported Oct. 31 (see charity texting story).

The bottom line is, the Red Cross is successful here for several reasons. 

1. When a crisis like Haiti happens, it owns the airwaves for a long period of time.  When the Haiti quake hit, it was around-the-clock news on every network and cable news station.  There were evening news specials, mid-day reports, etc.  There were celebrity telethons to support Haiti.  Radio updates throughout every day.  This story was top news on the web.  And everywhere a Red Cross story got exposure, they mentioned the mobile giving option and their short code.

The Red Cross didn’t have to pay a dollar for this media exposure.

2. The Red Cross has a disaster response plan that includes outreach/philanthropy.  They were able to capitalize on this within hours to ensure they had the funding necessary to handle this and future disaster challenges.  They didn’t try to throw a campaign together after the disaster happened – they simply implemented the plan that was already established.

3. They had a truly integrated campaign – not just a mobile initiative.  Yes, the Red Cross raised a TON of money via mobile after Haiti.  But they probably also raised significant dollars via direct mail, online, and maybe even DRTV.  The Red Cross knows they can’t just use mobile fundraising, so they made sure they had an integrated campaign.  And it worked well.

So here’s the dirty little secret.  A lot of nonprofits are looking at mobile as a way to cut costs and still raise money.  But it’s not going to work unless an organization has a MASSIVE audience (like the Red Cross did after Haiti).  You need a captive audience, or a major world-impacting issue in order to leverage mobile in any significant way.  If your organization doesn’t have that, mobile probably won’t work for you.

The downsides of mobile should make you think twice before you jump on the bandwagon.  You don’t get donor contact info (makes it very difficult to build long-term relationships).  Largest gifts you can generate are $10 gifts.  It could take months for you to actually get the contributions. 

I hate to be so negative, because in the long-term, I think mobile has a lot of potential.  But that’s what it is right now, just potential.