Mobile giving grows up

Salvation Army tests smartphones and credit cards; churches test pledging by phone

The earthquake that devastated Haiti nearly two years ago was followed by a massive relief effort that was supported in part by millions of dollars in donations by people who used mobile phones to text $5 or $10 to disaster aid groups .

Since the Jan. 12, 2010, earthquake, mobile giving has moved beyond disaster aid. Now, people make all kinds of charitable donations and pledges through wireless smartphones and tablets -- and the donations don't have to be done by text, according to industry officials.

This holiday season, the Salvation Army is testing smartphones that accept a credit card swipe using technology from mobile payment startup Square. Users in four cities can make gifts via credit card and smartphone as an alternative to dropping coins in a red kettle, Salvation Army Major George Hood said.

Mobile giving has also gotten religion -- literally. Some churches in Los Angeles and parts of Arizona have recently tested systems that allow their members use cellphones to make their Sunday-morning offerings virtually, instead of dropping coins, bills or envelopes in a plate passed down the pew.

"The minister will say, 'Normally I tell you to turn off your cell phone in church, but now you can turn it on' to pledge," said Douglas Plank, the CEO of MobileCause, which has sponsored several mobile pledging tests with churches and temples.

"People forget to bring their checkbooks, so using the phone makes sense," Plank said. "The ministries that have tested it see a 10% to 15% bump in giving when they do it."

Plank expects mobile pledging to "really take off" once the software is perfected and becomes widely available. The mobile giving concept makes sense because smartphone adoption is exploding and smartphones and tablets can be used to make gifts via text message or over the mobile Web and through mobile applications, including social networking apps.

Many disaster aid campaigns have relied on contributions of fixed amounts, such as $5 or $10, via texting, with wireless carriers dropping the texting fees and collecting the donations to distribute to charities. But new tools make it possible to make more generous donations via an SMS message or a smartphone app linked to a credit card or other account, Plank said.

MobileCause, which has worked with 1,000 charities to set up mobile giving programs, hopes to take advantage of emerging technologies such as Near Field Communication (NFC) to quicken the pace of mobile payments, Plank said. NFC is behind the Google Wallet application, which is currently available on the Nexus S 4G smartphone from Sprint. Google Wallet allows a user to touch a payment terminal with an NFC-ready smartphone to transfer funds . NFC is also being tested by a carrier consortium called Isis, which offers a rival to Google Wallet.

"All that NFC stuff is really fabulous for nonprofits, as a useful tool to reach their constituents," Plank said. "But we don't want to replace traditional communications tools, so this is additive."

How "additive" the mobile giving technology tools become is the big question -- one that the Salvation Army and others will monitor closely.

Last year, the Salvation Army set up traditional credit card terminals near its well-known red kettles, but those terminals generated only $60,000, Hood said. That's a drop in the proverbial bucket compared to the annual red kettle take of $142 million nationwide and the annual $1.8 billon the Army gets through all contributions, including online gifts from desktop computers.

The credit card terminals were cumbersome, Hood said, and it was especially difficult to use them in cold, inclement winter weather. They "were not very popular," he said, "and the average gift was extremely small compared to online giving."

Square's technology is being used by Salvation Army bell ringers in 10 locations each in Dallas, San Francisco, Chicago and New York. It's expected to be a "quicker and easier and less cumbersome" alternative to credit card terminals, Hood said.

Square provides a postage-stamp-size magnetic strip credit card reader that plugs into the headset port on Android smartphones. Sprint donated phones for use in the trial, and those phones are each equipped with an app from Square and one from the Salvation Army.

Users swipe a credit card, then sign on the smartphone's touchscreen and finally decide how they want the receipt -- either through text or email. (See a short Salvation Army video .)

In addition to receiving the donation, the Salvation Army can also collect contact information from the donor for use in future fundraising campaigns, Hood said.

The Salvation Army's smartphone tests only started in November, so no comprehensive results are available other than anecdotal reports of favorable reactions from users. "People see it and say 'Wow, that's interesting!' and want to try it," Hood said.

Part of the goal behind the effort was to connect an established charity -- the Salvation Army has been around since 1865 -- to younger people who use smartphones and mobile devices. "We try to get into the heads of emerging generations and want to build relationships with a younger audience," Hood said. "We have to be on pace with them."

A June 2011 poll of 233 nonprofit organizations found that mobile adoption continues to grow and that there is a shift away from texting toward use of mobile Web media. The poll, conducted by the Association of Fundraising Professionals and Kaptivate, a technology consultancy for nonprofits, also found that charities are using new mobile capabilities, including social networking apps, to not only raise money but also better engage supporters.

The survey noted that there had been "considerable disillusionment with mobile fundraising" in late 2010 and early 2011 based on verbatim comments the researchers received. But it also found that 70% of respondents had a growing interest in mobile media and activities. The kinds of nonprofits with the greatest interest in mobile included arts and religious groups as well as those in healthcare and education.

Two years after the text-giving successes that emerged from the Haiti earthquake, Plank said he has noticed a shift in how charities regard mobile devices as a way to seek pledges and connect with their supporters. His company has observed that religious groups, especially, are making efforts to go beyond fundraising via text to other mobile technologies that support ongoing pledges -- and larger contributions.

Nonprofits have moved beyond being the cutting edge early adopters with mobile, he said. "They are becoming leading edge, and there's a higher [mobile] adoption rate in churches where the young people are the early adopters."

As Plank sees it, "Mobile giving is growing up."

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. You can follow Matt on Twitter at @matthamblen , or subscribe to Matt's RSS feed . His email address is .

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