Although the Internet has been a key strategic component of many businesses for half a decade or more, it's still relatively new turf for not-for-profit enterprises. "Nonprofits are notoriously late adopters to anything technological," explains Chris Hollenbeck, a venture capitalist with Granite Partners who has invested in technology companies serving nonprofits.
Consider the Internet environment in which Planned Parenthood was living. With only two people supporting its Web site, it took months at times just to get a page posted, and the site was mostly brochureware. Information about constituents and their donation behavior lived only on a fairly unsophisticated mainframe application.
The organization was still communicating with its constituents primarily through direct mail, not e-mail, with each new mailing done basically from scratch. Smith says that, in all, the organization spends roughly $6.5 million a year on direct mailings. "It is by far our biggest expense," she says.
With only a $1 million IT budget, Planned Parenthood began shopping for technological solutions that didn't require spending more on internal IT support. "Most nonprofits like us just don't have the resources to hire people and maintain complex IT," says Robert Kane, the organization's CTO.
That's why Planned Parenthood turned to an ASP to host and maintain its site and provide the tools to help drive further donations. After examining proposals from custom Web publishers Donor Digital, CTSG, and Convio, Smith selected Convio as the organization's ASP. For roughly $6,000 a month and a $50,000 start-up fee Convio hosts the donation segment of the Web site and manages the applications. All credit card donations run through Convio into a Planned Parenthood account. Smith and her staff can directly post content on the site simply by accessing a Convio Web site.
Possibly even more significant is that Convio's software gives Smith's staff a comprehensive CRM strategy. It tracks constituents' preferences and provides tools that allow the Planned Parenthood staff to maintain a running dialogue with them.
The results have been tremendous. For example, when Planned Parenthood posted a Presidents' Day message online to get people to donate a check in the name of George W. Bush to protest his policies on abortion, each visitor was referred to the direct donation page online or to a phone bank. Within a few hours, the simple posting turned into an online viral marketing campaign. Two-and-a-half weeks later the organization had raised $320,000 solely on this bit of advocacy.
In the offline world this kind of groundswell would have been nearly impossible, says Smith. "This showed how the Internet can change fundraising," she says.
But that's not the only way. Take for example, the simple process of notifying people of new political issues. Each mailing costs Planned Parenthood around $120,000, or about 60 cents to 75 cents per piece of mail, and that doesn't include all the labor it takes to actually make sure the mailing gets out the door.
Today the organization's Web site has become a focal point for information distribution. The Planned Parenthood site asks visitors to register, and that process has given the organization a sizable database of e-mail addresses and constituent profiles. Using Convio it can then target registered users who fit the profile for a certain campaign with e-mail blasts at a cost of roughly 1 cent per e-mail. The e-mail recipients can click on a link in the message and go directly to a donation page on the Web site.
The CRM system has been a notable success. In fiscal 2000 Planned Parenthood received only $70,000 in online donations. In fiscal 2001, since adopting the new CRM and e-commerce technology, that number has gone up to $500,000. And that's not money that would have otherwise come in the mail or by phone, argues Smith. "Most were new donors," she says.
Compared to the cash outlay for the new technology, the organization is getting a very solid return on its investment. In fact Planned Parenthood says it has made up the ROI in only six months.
Since outsourcing much of the technology last August, CTO Kane says he couldn't be more pleased, especially considering his constraints of having to pay nonprofit wages and a limited IT budget. "There's no way we could get all this functionality on our own," he says.
David Lipschultz is a freelance writer based in Aspen, Colo.
