I just finished reading the 2008 donorCentrics Internet Giving Benchmarks Analysis, put out by Blackbaud company Target Analytics. Get the report and read it. It points to some great momentum in online giving.

By many measures, online fundraising had a red letter year in 2008:

• Online donors are younger and have higher incomes than traditional, primarily direct mail donors.
• Over the past few years, online giving has become an increasingly significant source of new donor acquisition.
• Online donors give much larger gifts than traditional donors.

You've probably already heard statistics like these floating around at various conferences and presentations. It's the kind of stuff we presenters say to justify the rest of our presentations. Fortunately, it's all true.

But, as the sector has embraced online giving, we've had a niggling voice in the backs of our heads telling us that the donors we've cultivated online aren't sticking around. It's one of those feelings we haven't wanted to talk about: Saying it out loud might make it true. And there really hasn't been a lot of data.

Well, this report has some pretty telling data.

Let's get the bad news out of the way first, shall we? Despite the fact that online-acquired donors give higher gifts both initially and over time, they renew at lower rates overall. Take a look at this chart from the report:

The lower retention rate drags down the lifetime value of online-acquired donors, as per this chart:

So, while we're busy chasing down those high-value online donors, they may be costing us more in the long-run. Unfortunately, there's nothing in the report about the cost of acquiring and cultivating donors online vs. offline, so it's hard to say.

I am, of course, NOT advocating that we stop fundraising online. While retention rates have been lower, there are opportunities and questions we still need to address.

• First, it's possible that online retention rates may increase over time as nonprofits become more savvy about the channel and the population moves more communication and interaction online in general. The correlated question is: Has retention for online-acquired donors increased, decreased, or stayed the same over the last four years? Is it trending in any direction?
• Secondly, four years is not a lot of data. It's enough to report on and start people thinking about the issues, but the field is pretty darn new. It's not just nonprofits that are getting used to all this, it's the public. Their behaviors will likely change over time.
• Lastly, all the data in the report reinforces another idea we've been championing in the sector: multi-channel solicitations. A good number of online-acquired donors give their second gift via direct mail. Offline donors with email addresses give higher amounts than other offline donors. Since integrated marketing is another skill the sector is working to hone, we may be able to boost giving further still. (Incidentally, our March newsletter, going out later this month, is all about integrated communications. If you're not already on our list, sign up today!)

To me, this all comes down to endcaps at supermarkets -- you know, the end of the aisle where stores stick glittery sale items. Whenever I walk by one of those, I'm tempted. I'm a sucker for 2 for 1 deals, even when I don't need the product. Many times I find myself picking the item up. Why? Because it seems like a good idea at the time and it doesn't cost me a lot. 

But unless that product is AMAZING, I never buy it again. For me, it's a right time, right place, right price situation. And that's your online donor acquisition. For many first time online donors, you are the right cause, in the right place, at the right time. You benefit from the immediacy of the web.

Offline donors, on the other hand, reflect much more before they reach for their checkbook. You're much more likely to be a staple on their recurring, feel-good shopping list. 

Supermarkets need customers to do both things, and so do you. But, like a supermarket, you REALLY win when you turn those impulse donors into long-term advocates.

We can do it, we just need to keep searching for the right strategies. Integrated marketing makes so much sense here. The more ways you communicate with a donor, the more chances you have to be in that right place, at the right time.

Now you tell us: does this match your experience with your online donation programs? The report has a small subset of organizational data. We're curious if it speaks to the sector as a whole.