Why Apple isn't the Nonprofit App Grinch | npENGAGE

Why Apple isn’t the Nonprofit App Grinch

By on Dec 10, 2010 | NONPROFIT-FUNDRAISING

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Why Apple isn't the Nonprofit Grinch

Nonprofit social media expert Beth Kanter isn’t happy with Apple at the moment. Her thoughts on Apple’s ban on donations in iPhone apps recently appeared in The New York Times. This isn’t a new issue for her and she blogged back in June on this topic. The Huffington Post featured her thoughts on the subject earlier this month as well. Beth is hoping that people will sign an online petition letting Apple know that people want to give on their iPhones.

Beth Kanter is a nonprofit rock star and I’ve had the good fortune of being her editor for a book chapter, a supporter of her work, and she’s always been receptive to my thoughts and the occasional guest post on her blog.

I just happen to have a slightly different perspective on this topic and I’m sure she’d agree that a healthy debate is always a good thing.

Should nonprofits focus on giving through iPhone applications? No. Not until they improve their existing online giving options and optimize their website for mobile devices.

Should Apple allow donations to nonprofits in their iPhone applications? No. Not unless they get it right and that’s easier said than done.

Let me take a few moments and expand on both of these perspectives.

Getting Mobile Donations Right

Is building an iPhone app the best use of a nonprofit’s resources? Probably not. Nonprofit organizations would get far better results from improving their own online giving experience. There are plenty of well documented and researched usability issues with nonprofit donations forms that can be improved to get better results right now.

There are also simple financial realities to take into consideration. PayPal briefly had a charitable giving option in its iPhone app before Apple requested them to remove that feature. In the three months that it was available the app raised just over $10,000 at an average donation amount of $12. That is significantly below average gift amounts through online donation forms. Is the strategy to make it up on volume?

I understand that every dollar counts but let’s not sacrifice the future on the alter of the immediate. Will you get donors through a mobile app? Perhaps. Will they generate significant revenue for your organization, give again, and remain loyal? Probably not. Research done on episodic donors would back this up.

Nonprofits would also reach far more people and have greater impact by optimizing their website for mobile devices instead of just building iPhone apps. Even the most downloaded iPhone applications reach a small percentage of users. You’re not Angry Birds or Facebook. Not to mention that focusing just on the iPhone ignores all the other mobile devices.

I can hear a lot of techie people pointing out that you can build apps that work on multiple platforms. Yes, I get that. However, very few would argue that designing for the entire mobile web has much more reach and bang for the bucks invested.

I would also argue that a petition to the phone carriers to increase the $10 limit on text-to-give in the United States would have much greater impact on the nonprofit sector. Next up is to get carriers in other countries to adopt a similar practice. But that’s a blog post for another day.

Getting iPhone App Donations Right

Apple’s approach to things is that less is more. They say “no” to a lot of features and ideas so that they can say “yes” to the right things. And when they do say “yes” to something they have a maniacal focus on making it the best. That would need be true for supporting donations too.

Getting it right would mean doing a lot of things including the following:

The Right Organizations
Who should be eligible to get a donation through an iPhone app? Only 501(c)(3) organizations? What about the 27 other types of tax exempt organizations in the US? What about nonprofits that don’t file an IRS Form 990? What about 527 political organizations? And what about organizations in other countries? Who plays the traffic cop?

The Right Giving Experience
Yes, I would love to see how Jonathan Ive and his Apple design team would re-create the online giving experience in an app. But that’s not going to happen because the vast majority of applications are designed by 3rd parties — not Apple. And that giving experience needs to account for scenarios like recurring giving, memberships, and event registrations if you really want to help a broad section of nonprofits. Not to mention getting receipting right.

The Right Donor Data Transfer
There is a lot of time and attention on what goes into getting someone to make an online gift. But what happens after the click is tremendously important to the nonprofit. Who stores the donor information and how quickly does the nonprofit get it? One of the biggest problems with all external giving sites is that lag time between the gift and the nonprofit being able to act on the information. Unless you get that right then you’re doing more harm than good to a nonprofit’s ability to build relationships with donors.

The Right Fee Structure
It’s widely reported that Apple takes a 30% cut of sales in their App Store. While I doubt that they would apply this type of fee structure to donations there will be fees involved. Processing a credit card transaction or facilitating a financial transaction will always have a cost. But what about refunds, chargebacks, disbursements, and answering donor questions? Apple would need to deliver high quality service in all these areas and it may not be worth the potential PR hit when something goes wrong.

The Right International Options
Supporting donations in the United States is one thing. Handling the payment, currency, receipting needs for the rest of the whole is a whole other adventure. What about organizations that operate in multiple countries or affiliates? What about Gift Aid in the UK or the intricacies of Canadian receipting laws or the multitude of other multinational transactional complexities? I doubt anyone thinks this should only be an option for US nonprofits, right?

Getting these things right don’t just apply to Apple. They really are applicable to anyone wanting to handle donations on behalf of nonprofit organizations.

Getting CSR Right

The whole debate over donations in app-land reminds me of the ongoing saga of getting Flash to work on the Apple iPhone or iPad. And is probably doomed to meet the same fate. I think the nonprofit sector would be better served by elevating the discussion about Apple’s broader corporate and social responsibility efforts.

Apple’s track record on corporate and social responsibility is spotty at best. I’m not sure that lifting the ban on donations in the App Store would give them a pass on everything else. They have a long way to go compared to some of their other corporate peers.

Apple could do a lot more good for the nonprofit sector by offering special discounts to organizations or gift-in-kind programs. I’ve never been to a nonprofit that couldn’t use some updated equipment for their staff in the office or in the field. Something like that would truly be getting it right.

ABOUT THE AUTHOR

Steve MacLaughlin is the Vice President of Data & Analytics at Blackbaud and bestselling author of Data Driven Nonprofits.

MacLaughlin has been featured as a fundraising and nonprofit expert in many mainstream publications, including The New York Times, The Washington Post, The Los Angeles Times, The Boston Globe, The Chronicle of Philanthropy, USA Today, The NonProfit Times, Bloomberg, and has appeared on NPR.

He is a frequent speaker at events including the Association of Fundraising Professionals (AFP), Association for Healthcare Philanthropy (AHP), American Marketing Association (AMA), Council for Advancement and Support of Education (CASE), Direct Marketing Fundraisers Association (DMFA), Giving Institute Summer Symposium, National Association of Independent School (NAIS), Nonprofit Technology Network (NTEN), Institute of Fundraising National Convention, Civil Society Conference, Resource Alliance’s Fundraising Online, and a keynote speaker at such events as the Crescendo Practical Planned Giving Conference.

Steve serves on the Nonprofit Technology Network (NTEN) Board of Directors and supports its focus on both the growth and professionalism of the nonprofit technology field as well as building knowledge and information sharing capacity throughout the sector.

He is a frequent blogger, published author of a chapter in the book People to People Fundraising: Social Networking and Web 2.0 for Charities, and is a co-editor of the book Internet Management for Nonprofits: Strategies, Tools & Trade Secrets. His latest book, Data Driven Nonprofits, became a bestseller in 2016.

Steve earned both his undergraduate degree and a Master of Science degree in Interactive Media from Indiana University.

Comments (15)

  • Beth Kanter says:

    Steve: Thanks for your thoughtful post, glad my agitation prompted some insightful thinking ….. My initial thought is this … “getting it right” means that Apple is willing to listen and respond to the people in the nonprofit sector on
    all the points you are raising. Right now for apple — this issue isn't
    on Apple's list of priorities and they're not responding. It is unclear if they are listening! In an ideal world, they would be that they gather up group of people from
    the nonprofit tech industry, listen to their views on the topic, and work
    mutually together on a solution that is a win-win for our sector and be a
    cornerstone of a CSR strategy. Now, that would be being a good
    corporate citizen.

    Getting it right means listening and responding to concerns,
    challenges, and needs in the nonprofit sector – they're not doing that
    — and unless enough people agitate to get their attention, with a
    follow up of a dialogue – nothing will change …

    And that's why I went Android shopping!

    • smaclaughlin says:

      Beth…

      Agreed. Apple doesn't have a good track record with helping the nonprofit sector. Compared to most other tech companies they're practically invisible.

      This absolutely comes from the top down. Steve Jobs has historically been silent on the entire topic. And his personal philanthropic interests are an unknown unless he's been giving anonymously.

      If this or something similar gets Apple to engage in a conversation, then I'm all for that.

  • jondunn says:

    Steve,

    As always you manage to put the mad rambling thoughts in my head down on paper coherently 🙂

    Would iPhone giving be cool? Sure – but there are much, much more pressing issues for 98% of nonprofits. This whole issue feels super squirrel to me. It'll happen eventually, I believe, and probably much more in line when more nonprofits will actually be ready to be able to adopt the technology.

  • Steve, I agree wholeheartedly that most nonprofits should not focus on iPhone donations. No question – there is so much work that most organizations need to do, as you have very eloquently detailed above.

    But that doesn't get Apple off the hook. As Beth has said, the issue is Apple's closed system, not whether or not nonprofits should focus on iPhone apps.

    I'm not holding my breath (and anyway, I don't really care, I ditched my iPhone months ago, happily.) I think Apple is happy to remain a closed system. In my opinion, when nonprofits DO start to get things right, they should be looking at the open platform.

  • I agree 100% with your 96% estimate, Jon. But that means that more than 75,000 non-profits (4% of all of them in the U.S.: http://foundationcenter.org/ge…) are impacted by Apple's decision to make donating on a iPhone a difficult process. What's “super squirrel” about that? I appreciate Steve's breakdown, and he makes a lot of points, some good. The overall “most NPOs have better things to do” is quite valid. “Only $10k was raised” is meaningless — the two month's that Paypal supported donations was not enough time for the app ecosystem to learn about it and adjust their apps to take advantage of it. We have no idea what the financial potential for in-app donations is,as we haven't had a meaningful opportunity to evaluate it yet. And every one of these issues impacts Android, too, outside of the points about Apple carefully controlling their interface (and allowable content).

    But, here's what I think. If you think mobile donations are a waste of time, then, five or ten years ago, you probably felt the same way about web donations. If there's anyone I know who has passionately argued for multi-channel fundraising strategies, it's the guy who writes this blog. Mobile is going to be a huge channel. Smartphones are flying off the shelves and tablet sales are expected to boom by 2012.

    Is Apple's policy the worst threat to NPOs today? Hardly. But it is significant, and it will get more significant every day. As Beth said, they need to come to the table and talk with us. And we need to know that the leader in mobile technology isn't going to shut us out.

    • jondunn says:

      Don't disagree – but we can safely assume that number are larger organizations who have the money and the capability to provide solid mobile experiences anyway. An in-app donation feature would just be icing on the cake.

      I definitely don't think mobile donations, and mobile solutions are a waste of time. In fact, at the recent BBcon, Steve himself displayed a statistic that mobile web usage will actually pass desktop web usage by 2013. It's importance can't be debated.

      I just think the point about mobile experience as a whole, and providing solid mobile donation form solutions (and helping nonprofits do that) would be money and time far better spent IMO, versus wrestling with a corporation who has shown time after time they could care less what the masses think (murky app approval process for example).

      I think we're on the same page. Like I said, I think it will eventually happen.

    • smaclaughlin says:

      Peter…I agree with your comments that mobile is today where online giving was 10 years ago. In fact, I've been saying that to anyone who'll listen for two years now.

      And yes, I'm passionate about multichannel fundraising and mobile NEEDS to be part of that continuum. I just think that apps for the iPhone should be much lower down on the list of things a nonprofit should focus on right now.

      You can't go wrong with designing your website and giving experience for mobile. In fact, any redesign project should be taking that into consideration from the start.

  • Matt Monday says:

    I left Apple to start my own company in November. This company deals directly with the charity/donation space. My current focus is in mobile, and I believe that this will disrupt (for the better) everything that we know about donating. This article is some of the best motivation I have had in the past few weeks to keep doing what I am doing. If anyone can solve this issue, I believe that I can. So I will. My name is Matt Monday, you can reach me here: Mondayma@gmail.com

  • John Rougeux says:

    I think there's a great business opportunity here. Couldn't someone build a NPO aggregator “clearing house” that did all of the dirty work Apple doesn't want to get involved in? The aggregator itself could be an app for the Apple platform. In such a scenario, Apple would only have to approve the aggregator app, not the individual NPOs themselves. NPOs that wanted to participate in the aggregator's platform would have to undergo a vetting process, and donations through the aggregator could be subject to a fee. Am I missing anything here?

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