Mobile phone user shopping online

A quick note: There’s a lot of buzz about Cyber Monday today. After you read this post, check out my interview with NPR’s Marketplace Tech radio show about combining charity and shopping.

Welcome to Cyber Monday. Consumers will spend an estimated $3.4 billion on the internet today, making it not only the biggest online shopping day of the year but the biggest single online shopping day in history. And thanks to online programs called “charity shopping,” nonprofits will get some of that money when a percentage of each purchase is directed to a nonprofit of the shopper’s choice.

Charity shopping can seem attractive to both shoppers—who get to be donors with no additional cost—and to the nonprofits who benefit from their shopping. At least, until you take a closer look at the details.

First, let’s look at how they work. These are affiliate marketing programs. The retailer pays a commission to the referring entities, and the charity shopping sites pass some of that commission on to the charities. They might say 100 percent of your donation gets passed through, but they are still getting a commission on top of that. It’s a way to stimulate sales for retailers. That doesn’t mean the retailers and referrers don’t have good intentions, but I think it’s important to also acknowledge that someone is making a profit off of this.

Perhaps the best known charity shopping program is Amazon Smile (https://smile.amazon.com/). To date, Amazon Smile has directed over $37 million to charities, according to its website. Idealware participates in this program by encouraging our supporters to select us as their preferred charity. If they register and remember to go to a special web address to do their online shopping, Amazon gives us 0.5 percent of every directed purchase made through smile.amazon.com. Say one of them buys a $100 Keurig, we get 50 cents.

Which means Idealware has benefitted from that program to the tune of about $15 a year.

Nonprofits must actively promote charity shopping in order to have any success with it. Say it takes 30 minutes to register, and then another two hours to write and send an email announcing that your organization is eligible to receive donations. But one email is not enough—statistics show that you have to expose people six to seven times to an email message before it sticks. What if you instead spent that time meeting with a few existing donors and persuading them to increase their contribution or make a bequest?

For small nonprofits the ROI of charity shopping is usually not compelling compared to fundraising campaigns with a specific goal and timeframe.

But what about shoppers? For them, charity shopping is an easy way to direct money to charity with almost no effort, and at no additional cost. Customers do their shopping through a portal or plug-in. In most cases they designate which nonprofit will receive the donation. They also receive coupons and special offers.

But some have suggested that by participating in charity shopping, individuals are checking “make a donation” off their list without actually doing anything that’s meaningful to them or the nonprofit they are supporting. Is charity shopping substituting for genuine connections with a cause or community, or leading people to casually give less than they otherwise might? I can’t answer these questions, but I think they are worth asking.

One last thing to consider: Spending money at Amazon means not spending it at local retailers or independent bookstores. If you’re concerned about consumerism, environmental sustainability, or supporting local economies, consider making your purchases at your favorite local shops and donating money directly to your favorite charities.

What’s the bottom line? For nonprofits, these programs are not magical money trees. It’s pretty simple to register and just let money trickle in, but if you expect big returns, you’ll need to invest heavily in awareness and promotion—and you might be better off investing those resources in other fundraising channels. For donors, if you’re already shopping online, you might as well skim a bit off to go to your favorite charity.

But if you really want to make a difference, take a moment to research and connect with an organization on a deeper level and donate to them directly. It has a greater impact than fractional pennies on the dollar, and it feels better too.

Further Reading

Want to learn more about charity shopping platforms and related services?

Charities Profiting Via Online Retail Sites

The NonProfit Times

Idealware wrote this article for the Nonprofit Times in 2011. Several of the services we discussed then have now gone out of business or changed to more mainstream affiliate marketing models.

Five Fun and Easy Ways to Donate To Charity

NewsBlaze

This short list presents a handful of shop-to-give sites that fall under the charity shopping model.