Fundraising Becomes a Pain in the App

Posted by Ben Burdick On December - 16 - 2010

With Apple’s recent ban on apps that allow direct donations to charities, countless nonprofits are likely scrambling to figure out ways to raise those last few dollars before the end of 2010.  I’m willing to venture a bet that, if they don’t already have one, almost every nonprofit organization in the U.S. has considered creating an app as a direct fundraising tool.  So why has Apple decided to forego allowing nonprofits to raise money directly through an app?  It’s understandable from a business perspective, as Apple doesn’t want to be in the business of verifying charities as legitimate 501c3 organizations nor be responsible for distributing the funds of those that aren’t (not to mention, it doesn’t look great for Apple to be taking their cut from a charitable donation).

But while the app ban does not prevent nonprofits from having apps that direct users to their websites to donate, it does introduce another level of separation in a fast-paced electronic world where people want a one-touch, easy system to make their decisions on everything from purchasing a game or an album, to making friends on Facebook.  These apps allowed nonprofits to respond quickly to situations where donations and relief are needed quickly, as evidenced by the trend in mobile and electronic giving following the Haiti earthquake.

A number of nonprofits are showing their anger at Apple’s decision to ban these apps, setting up petitions to reinstate their apps and calling Apple CEO Steve Jobs a “Grinch” to institute a ban so close to one of the most important times of the year for nonprofit fundraisers.  Though it’s unlikely to happen, Guidestar has even offered a solution to partner with Apple and vet each nonprofit who creates a donation app.

Regardless of the ultimate outcome on Apple’s end, this has left a hole for nonprofits that Android carriers are likely debating on whether to fill or to follow Apple’s lead.  And while it’s unlikely that most people will give up their beloved iPhones or iPads over this issue, it could hurt Apple’s image in the long run.

How do you think this will affect nonprofits at the end of this year and in 2011?  What are some ideas to help solve Apple’s issues with verifying a nonprofit’s mission and goals?

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5 Responses to “Fundraising Becomes a Pain in the App”

  1. [...] This post was mentioned on Twitter by artsusa.org, ArtsActionFund. ArtsActionFund said: ARTSBLOG >> Fundraising Becomes a Pain in the App: How is Apple's charity donation app ban affecting nonprofits? http://bit.ly/gTxvZ3 #arts [...]

  2. Brian H says:

    “I’m willing to venture a bet that, if they don’t already have one, almost every nonprofit organization in the U.S. has considered creating an app as a direct fundraising tool.”

    Ben – You would lose this bet miserably! Good commentary here on an issue of growing import, but the above statement borders on the hyperbolic. Sure, progressive and/or large nonprofits have incorporated mobile apps and made them central to their fundraising, but the sense I have in my neck of the woods is that too few people own iPhones for donation apps to be worth investing in (that is, if they’ve even considered them yet, which I can assure you many have not). The iPhone has so much cultural significance right now that it’s easy to forget only 2% of the U.S. population is using them. So, to answer your question, I can’t imagine Apple’s ban will have a marked impact on donations for the majority of U.S. nonprofits. The bleaker reality is that many are still just getting a handle on online giving.

    • Ben Burdick says:

      Thanks for your comment, Brian (and great post on your blog about opera in Mad Men). While I agree a lot of nonprofits are yet to have the ability, both financially and technologically, to adapt apps in their fundraising process, I have to disagree with calling my statement hyperbolic. Perhaps I should’ve used the word dream instead of considered, though. I think most nonprofits dream of having an app on one of the OS, be it Android or iPhone, in the hopes of easy fundraising dollars. Even People Against a Violent Environment, or PAVE, in Beaver Dam, Wisc., a local nonprofit with a relatively small budget, has created 3 apps. From http://philanthropy.com/article/For-MoreMore-Charities/64271/ – “People Against a Violent Environment, or PAVE, in Beaver Dam, Wisc., which runs on an annual budget of $350,000, has developed three iPhone applications because the executive director’s husband does the work pro bono. The charity serves 700 victims of domestic violence and sexual assault annually and reaches about 3,000 people through its education programs. Yet PAVE’s applications, which promote awareness of sexual, domestic, and child abuse, have been downloaded by close to 5,000 people.”

      While I would not disagree with you that most nonprofits haven’t considered apps due to the constraints, I’d have to say that many have thought about them and would love the opportunity to have one, and it’s becoming increasingly easier because of pro bono work like the example listed above.

      • Brian H says:

        Ben – It is basically impossible to know which orgs have considered or dreamed of having apps for fundraising, but I hope you are right that it is at least a discussion most are having. The PAVE example is much appreciated. It definitely shows what the possibilities are with some pro-bono help, and the 5,000 downloads is a sign that they are creating smart content that is relevant beyond their market. Great food for thought!

  3. I can understand the issue from both sides of the ban. That one degree of separation is costly for these nonprofit organizations. It will be interesting to see if a developer can work out a better work around. I know we are researching this issue.

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