Harriet Whitehead: Is there a future for donating by text message?

05 Sep 2019 Voices

After the most recent figures showed an uplift in the amount donated by text message, Harriet Whitehead takes a closer look at what this means for the sector.

Last year it looked as though text-donation was becoming less popular, but recently the Phone-paid Services Authority (PSA) published findings which suggest there may be a resurgence. 

The PSA announced, in its Annual Market Review, growth in donations to charity by text, from £37.9m to £49.6m between 2017/18 and 2018/19. It is estimated that over 25 per cent of the donations made to major charity telethons in the last financial year were made by text. 

Joanne Prowse, CEO of the PSA, says: “This news demonstrates that donating by text is an increasingly attractive option for UK donors, with considerable potential for the charity sector as a whole.”

It cited two key reasons for the growth. First, several large telethons which are held every two years, principally Children in Need and Red Nose Day, provided a boost to overall charity donation figures in the UK.

It also cited changes to the upper limit of text donations. The networks currently impose a maximum donation limit of up to £30 per 24 hours, or £20 for a single donation. BBC Children in Need collected £12.9m through text donations during 2018 by adding a text cap of £30.

Howard explains that “there was an appetite for higher value text donation points”, and that by widening the range of donation values, the appeal has opened up the most popular donation mechanic to a wider audience.

The PSA has said, however, that the value of text donations is expected to fall to £43m in 2019/20 due to fewer telethons.

Market challenges

This was something of a surprise as the previous year the market had been thrown into turmoil after the figure for charity text donations plummeted by £86m. The PSA revealed in its annual market review for the 2017/18 financial year that it had made an “overestimation”, and that donations made by text had actually been only £37.5m, compared to an estimated £124m. 

Wider technology concerns had also led some charities to believe that the format had run its course. Industry giant JustGiving closed its JustTextGiving earlier this year saying the “tech had moved on”. The service was free for charities and was funded by JustGiving and Vodafone. It raised over £40m in total before being shut down.

In a statement at the time, JustGiving said: “Smartphone technology has meant that more and more people prefer to donate directly via their internet-ready device, and charities received consistently higher donation values.” 

Another issue with text services had involved user satisfaction, with complaints about one-off donations leading to the supporter being hounded to give more, and claims that people were subscribed without being explicitly informed as to the financial obligation.

Kerry Howard, head of appeal operations at BBC Children in Need, also cites issues surrounding Gift Aid, saying: “The Gift Aid take up is lower than on other platforms, meaning that we are able to claim less Gift Aid back than we do comparatively through other platforms. There is also less data capture with text, which whilst making for a smooth and frictionless transaction, makes any deeper cross supporter analysis tricky.” 

'Frictionless easy way to give' 

Nonetheless, it is clear that money is still being donated via text. 

Howard says: “There are many positives to giving by text. It is a quick, frictionless, easy way to give through a platform that the vast majority of our supporters have access to at their fingertips. Text giving has removed the barriers to donating presented by traditional methods such as by phone, online, or cheque, and this has led to a wider audience being motivated to give.”

Daniel Fluskey, head of policy at the Institute of Fundraising, says: “The key to good fundraising is about monitoring and adapting to the changing needs of your donors, and creating strategies that work for them. Text donations continue to be an easy and accessible way for people to give to the causes they care about, especially in emergency appeals.” 

Indeed platforms are cropping up to capitalise on the resurgent growth. 

One of those is text-to-donate platform Donr, which launched at the beginning of the year and is now used by more than 1,100 charities to fundraise.

Co-founder and CEO of Donr, Chris Newell, says: “We noticed over the years that text giving had great potential, but that the potential was never quite realised. For some reason the market had not been adopted by the masses.” 

Donr formed a two-pronged strategy: to keep consumers content by showing monthly donors “where their money is going”; and to explore new ideas.

Some charities have even looked to introduce text services themselves. Battersea charity launched a micro-donation text pilot scheme and the British Heart Foundation announced that people can donate using Amazon’s virtual assistant, Alexa. Facebook has also introduced a new Instagram donation sticker.

The next issue of Civil Society Media's Fundraising Magazine includes a more in-depth look at what the future holds for text giving. Find out more about subscribing online.

Civil Society Media's Charity Technology Conference takes place on 6 November. This year’s programme looks at how charities can harness new tools, the ethics of doing so and features an array of case studies. View the programme and book online.

 

 

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