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Has mobile giving reached a tipping point?

An executive of Mobile Accord Inc.’s mGive discussed the most successful SMS donation program ever and the exploding mobile giving space in an exclusive interview.

Hundreds of thousands of mobile phone users have made $10 donations to the American Red Cross Haiti Relief and Development Fund by texting the keyword HAITI to the short code 90999, raising a record-shattering $32 million in mobile giving for the ongoing relief efforts. The mobile giving program was established within hours of the January 12th earthquake in Haiti through the efforts of the U.S. State Department, Mobile Accord/mGive Foundation, CTIA–The Wireless Association and the American Red Cross.

Mobile Commerce Daily’s Dan Butcher interviewed Tony Aiello, cofounder/CEO of mGive, Denver, about the current state of mobile giving and its potential. Here is what he had to say:

What is the state of mobile giving nationwide?
It is still very early days for the whole mobile donation category. We think a comparison of the history of online donations is instructive.

In 2007, $10.44 billion was raised online for various charities. However, it took some time for the online channel to gain the awareness and credibility necessary to achieve this level of impact.

In the second year of online giving, just $300,000 was raised. In the third year, donors gave $10 million online.

We’re now in the second full year of mobile donations and we have clearly seen a faster start than online.

As people responded to the terrible disaster in Haiti, their response raised visibility for the whole idea of text donations.

People are becoming increasingly comfortable with the technology and we think that adoption will continue to increase as more nonprofits understand how to run successful mobile donation campaigns.

We are also just seeing the tip of the iceberg in terms of applying emerging mobile technologies to make mobile pledges even more flexible and convenient for donors.

Is $10 the maximum mobile donation?
The carriers determine the donation amounts and today they allow either $5 or $10 donations.

What is the level of consumer awareness of SMS donations?
More than 3 million people texted donations to Haiti in the last month and a half, thanks to the many people who helped to spread the word about text giving, primarily through the Red Cross and the U.S. State Department.

MTV’s “Hope for Haiti” concert and media including [MSNBC’s] Rachel Maddow Show, [CNN’s] Larry King Live, NPR, PBS, the New York Times, a special public service announcement with a call-to-action from the First Lady and thousands of other articles, TV shows and radio shows, more people than ever before are now aware of the potential to use their phone as a way to give to causes that are important to them.

Which nonprofits have found most success with mobile donations?
Using mGive’s platform, the American Red Cross raised more than $32.5 million dollars for Haiti. This is by far the most successful mobile donation campaign ever.

Previously, Alicia Keys worked with mGive to power donations for her charity “Keep a Child Alive.” In a single American Idol appearance, she requested donations and received over $450,000 from viewers.

Including other mobile giving efforts, Keep A Child Alive has raised approximately $1 million dollars through the mobile channel to date.

Teleton MexAmerica raised around $200,000 during a telethon back in December of 2009.

There are many other examples of small and large nonprofits using mGive to successfully raise money.

MGive currently works with 250 nonprofit organizations for their text donation campaigns, so there are many other success stories, but certainly the American Red Cross is the most visible and successful to date.

The American Red Cross is the poster-child for mobile donations. How did it get there?
The successful Red Cross text donation campaign for Haiti was ultimately a collaboration between the State Department, the Red Cross and Mobile Accord’s mGive.

The generosity of millions of Americans who saw the images of suffering in the news really propelled the donations, and many of those same people helped to build momentum for text donations using social media to urge their friends to make a difference.

Was the Haiti tragedy the tipping point for mobile donations to take off?
Since the tragedy in Haiti is still relatively fresh, we do not yet have the benefit of the kind of hindsight that is required to confirm a tipping point. A lot of people certainly think it is a pivotal event.

For one thing, many nonprofits that might have been unaware of the potential of mobile donations now have a clearer understanding as a result of the response for Haiti.

In addition, a lot of everyday people who did not know anything about text messages before Haiti learned about it because of the disaster.

For example, we actually spoke to one man who had just turned 83. He wanted to text a donation for Haiti for his birthday, but he needed help to understand how to send a text message. After a few minutes and a brief explanation he was comfortable with the process and sent a successful donation.

The real power of text donations is in its immediacy and its ability to expand the number of people involved in charitable giving.

People do not need a lot of money to make a text donation; they do not need a credit card, they do not even need a bank account.

We think it is an incredibly powerful platform that will help to change the face of charity.

How can charities promote mobile giving?
There are a lot of different giving campaign models used by the more than 300 charities we are supporting. As a result of their experiences, we are sharing best practices for mobile campaigns with the different charities who partner with us.

Some of these best practices include ways to link mobile donations to events to take advantage of the accessibility of the mobile device.

Other best practices involve ways to build a text donation community by using periodic text messages appropriately.

We expect that new models and campaigns will emerge as new mobile technologies are available.

What is mobile donation’s edge over online and mail?
Mobile is an instant and convenient way to give. Wherever people are when they hear the request to give, they will likely have their phone with them and can give immediately instead of waiting to get to a computer or mail in a check.

With text donations, it only takes a few moments to type in the code and confirm the donation—there’s no need to provide bank account details or credit card numbers.

Online giving and direct mail are still wonderful ways to raise money and will be with us for a long time.

What about donor fears over billing and transaction security?
Donating by text message is very safe, particularly in comparison with online giving, where charities may not be qualified against stringent standards in advance.

In addition, since mobile donations do not require the use of a personal credit card, there is no threat of identity theft or phishing.

Maximum donations are $10, and carriers typically limit the number of donations per person to ensure there is no misuse. Carrier networks are highly secure.

One hundred percent of donations are passed through to the nonprofit organization.

MGive charges a small monthly fee to the organizations, and carriers do not charge for the use of their networks or billing systems.

What are your expectations for mobile donations this year and next in dollar amounts?
It is difficult to predict the dollar amounts that may be raised using text donations. We do know that the number of charitable organizations that are implementing some type of mobile donation platforms is increasing as a result of increased awareness of the text donation channel.

We believe that we will see a baseline increase year-over-year, but we are unlikely to see another single event raise funds like Haiti.