Commentary

The Reliability Factor: Charity Begins At Homepage

Another week, another new social network, promising a new way of facilitating life, the universe, and everything. This week's entry is Jumo, a social network created by Facebook co-founder Chris Hughes, who tells The New York Times the site is intended to help people stay in touch with charitable causes close to their hearts. The site included 3,000 organizations and issues at launch, and any non-profit organization can create a profile page, provided it can provide proof of official tax exemption to certify its authenticity.

While fund-raising is an obvious utility for the site, Hughes tells the NYT that Jumo isn't just another means of passing the basket; it's actually a long-term play. Essentially Jumo is intended to increase donations in the long term by bringing individuals into closer, more regular contact with their favorite causes. This engagement will hopefully translate into a higher rate of giving over time: "The more connected that individual is to an issue they care about, the higher probability there is they will stay involved over a longer period of time."

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This is an interesting approach to a problem which has long perplexed charitable organizations and marketers alike: how do you transition a one-time donor (or consumer) into a loyal supporter (or repeat customer)? This is above all a question of winning "mind share," a lasting, favorable presence in the individual's memory -- refreshed of course by periodic messaging, including brand advertising, word-of-mouth, and now social media interactions.

The human tendency to act and forget presents particular challenges in the world of charitable giving. For one thing, donating money to worthy causes may be spiritually gratifying, but it's just not as immediately useful or pleasing as buying something for oneself. Meanwhile awareness of causes tends to rise and fall with attention from the news media. And on a related note, non-profits risk donor fatigue by bombarding supporters with constant reminders about the depressing state of the world: basically, how do you nudge individuals who gave previously to give more without inflicting so much psychic distress that they just tune out?

The charitable relief effort for Haiti provides a good example of the short-term nature of a lot of non-profit giving. In the immediate aftermath of the earthquake on January 12, 2010, Americans were moved to donate by constant news reports on the huge death toll -- now estimated at 250,000 -- accompanied by spectacular pictures showing total devastation. After a week, U.S. private donations topped $200 million; on January 27, they hit $528 million, and by mid-February they were over $900 million.

But then, unsurprisingly, donations slowed dramatically as Haiti slipped from the headlines: by late October, total U.S. private donations were about $1.1 billion. In other words, 82% of the donations came in the first month after the disaster, with the remaining 18% trickling in over the following nine months. And while there's no question Americans donated generously to aid Haitian recovery efforts, there's also no question Haiti needs all the help it can get: most experts estimate the total cost of reconstruction at $14 billion, and as the recent outbreaks of cholera and election violence have shown, the country is still reeling from the combined effects of the earthquake and chronic poverty.

Again, I'd like to emphasize I'm not criticizing American charitable giving, which is among the most generous in the world: despite the recession, total U.S. giving came to $304 billion in 2009, down just 3.5% from a record $315 billion in 2008. That works out to $1,000 per American. But needless to say, from a strategic point of view, non-profits will obviously welcome any new organization -- like Jumo -- with potential for making charitable giving more regular and reliable.

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