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January 12 2012

15:20

Pew Studies the Power of Text-Based Donations After Haiti Quake

A simple text message can have a big impact. Mobile giving makes it easy to donate almost instantaneously after disaster strikes -- users authorize a mobile donation by texting a keyword to a specific short code, and the donation is then billed to the donor's mobile phone bill, eventually ending up with the nonprofit of choice.

haiti.jpg

Following the devastating Haitian earthquake of 2010 that left more than 200,000 people dead and more than 1 million Haitians homeless, mobile donations to Haiti totaled more than $43 million -- the first time mobile giving went mainstream in the United States on a large scale.

On the two-year anniversary of the Haitian earthquake, the Pew Internet Project has released "Real Time Charitable Giving," a report that delves into mobile giving and donors' motivations in the U.S.

The report, a collaboration among the Pew Internet Project, the Berkman Center for Internet and Society, the Knight Foundation, and the mGive Foundation, aims to provide a window into the motivations, benefits, and potential pitfalls of mobile giving campaigns.

Drawn from a sample of 863 individuals who made a mobile donation to the "Text for Haiti" campaign, the survey covers why the users gave, how they learned about the mobile donation campaign, how likely they were to share information about their mobile donation, and how likely they were to remain engaged with relief efforts.

Key Findings

Many of the contributors to the Text for Haiti campaign were first-time mobile givers; 74% of the respondents said that the earthquake response was the first time they had used a mobile device for charitable giving. Many of the users went on to contribute to other relief efforts (such as the Japanese tsunami and the BP Gulf oil spill) through mobile donations, with 56% of the respondents saying they had continued to use mobile donations for other efforts.

Some of the key benefits of mobile giving are the ease of the transaction and the relatively small donation amounts, which make it an easy impulse decision; 73% of respondents donated the same day they heard about the campaign, and 50% of those users donated immediately upon hearing about it. The ease of mobile giving also encouraged the donors to spread the word about the campaign to their social groups; 43% of the surveyed mobile donors reported that they encouraged their friends and family to make mobile donations as well.

Unsurprisingly, the report found that mobile giving attracted a younger, more diverse, and more technologically savvy group of donors compared with the typical nonprofit donor. The majority of the respondents were also more familiar with the little computers in their pockets, using their phones in more ways than just texting or calling (such as taking photos, accessing the mobile web and social networking sites, sending and receiving emails, etc). Less than 40% of average U.S. mobile users use these features.

A downside to the mobile giving campaign was respondents' limited long-term engagement with relief efforts and news following their initial donations; 43% of participants reported that they were following the reconstruction efforts "not too closely," while 15% were following them "not at all." Furthermore, the impulse decision to make a mobile donation meant that there was minimal research into relief efforts before the donation, with only 14% of respondents saying they had researched where the money would go before making their mobile donation.

The spur-of-the-moment nature of mobile donations and the ease of the transaction make mobile giving an easy way to reach a large number of donors, despite the challenges.

Image courtesy of the United Nations Development Programme and used under the Creative Commons license.

July 29 2011

12:11

Microsoft Donation Program: How Does It Work?

Interested in TechSoup’s Microsoft Donation Program? Whether you are new or experienced with Microsoft donations, join us for a quick webinar to learn about the recently updated Microsoft donation program, restrictions, and additional benefits that will help you to get the most out of your donation request.

This webinar will help you to understand how the updates will affect your organization. This webinar is suited for all nonprofits and public libraries in the United States that are interested in requesting a Microsoft donation.

Details

July 05 2011

07:31

Side by side - Loyality of different nature: Washington City Paper and readers' donations

New York Times :: When Daniel Snyder, the owner of the Washington Redskins, filed a defamation lawsuit against the Washington City Paper in February, readers rushed to show their support — and the newspaper gave them an outlet. The City Paper set up a fund for reader donations meant to offset the litigation fees, collecting 600 donations totaling $28,000 in the first three weeks.

[Amy Austin:] We’re not used to getting money directly from readers.

Since then the flood of contributions has declined. The paper is left with a fund that matters more for what it has come to represent: tangible evidence of reader loyalty at a time when many newspapers are fighting steep readership declines.

Continue to read Sydney Ember, mediadecoder.blogs.nytimes.com

May 04 2011

18:41

Columbia J-School Students Try to Keep Professor Off Social Media

News of Osama bin Laden's death brought a huge surge of activity to Twitter and other social media platforms Sunday night and Monday. So it's a strange quirk of timing that this is the week that Sree Sreenivasan -- digital media professor, dean of student affairs at Columbia Graduate School of Journalism and longtime social media enthusiast -- has agreed to go silent for 24 hours on Thursday.

It's no accident that Sreenivasan shows up on such lists as Poynter's "35 Most Influential People in Social Media" and AdAge's 25 Media People to Follow on Twitter. When news began leaking out about Bin Laden's death on Sunday night, @sree was right there with:

sree tweet bin laden.jpg

He followed with tweets pointing to background information about Bin Laden and even an explanation of how a city in Pakistan came to be known as Abbottabad.

How many messages does he send out on social media?

"I get a boatload, but it's a good boatload," said Michael Cervieri, co-founder of ScribeLabs, a media production and digital strategy firm, and founder of the Future Journalism Project. "It's mostly tips, tricks and insights from sites I don't visit too much on my own. So, if I think about it, he's an ambient bookmarker I can turn to when I want to learn about new apps or changes in existing ones."

But it's not all business with Sreenivasan. His Facebook page is sprinkled with photos from family vacations or his brief forays away from his computer, BlackBerry in hand, out onto the sidewalks of New York.

SPJ Capitalizes on Loud Voice

So what could possibly silence him for 24 hours? The student chapter of the Society of Professional Journalists (SPJ) at Columbia.

"A few years ago, Dean Sree was known for sending school-wide emails known as 'Sree-mail,'" Columbia student LaToya Tooles told me. "He sent a lot of it and students begged him to stop. Now Sree does a lot of tweeting, and while we don't mind the tweeting, we thought we would adapt a few fundraising models and capitalize on his rather loud web voice."

When Tooles and her fellow student Andrew Seaman approached Sreenivasan with the idea, he said "absolutely not." He reminded them of the Digital Death campaign last year in which a group of celebrities vowed to stay off Twitter until a certain amount of money was raised. He insisted that he would not engage in something he called "egotistical," something that suggested his messages were so valuable that people should pay for them.

sree sreenivasan.jpg

A clarification caused him to relent: This would be the opposite of the Digital Death fundraiser. Contributors would not be paying to receive his tweets; they would be paying to keep him quiet. "This is the idea that nobody really wants my stuff," Sreenivasan said.

So a Silence Sree web page was set up and if 200 people donate $5 or more, Sreenivasan's 4,999 Facebook friends and 19,400 Twitter followers will not hear from him for 24 hours. Columbia students who donate cash can give as little as $1. If fewer than 200 people donate, the silence will last for a comparable portion of the day. All the money will go to charity: 85% to scholarships for Columbia journalism students and 15% to earthquake/tsunami relief in Japan.

So far, the campaign is nearly halfway there, with 51 donors giving $443.

A Tall Order

Sreenivasan and everyone who knows him acknowledge that this is a tall order.

"I think Sree can do whatever he puts his mind to," Tooles said. "He isn't allowed on Facebook, LinkedIn, Twitter, Foursquare or Posterous. If he invents another social media between now and Thursday, I'll be very upset with him, but probably not surprised."

Sig Gissler, the administrator of the Pulitzer Prizes, said: "Sree is one of the most generous persons I know. He naturally has countless social media connections and he spends a lot of time coaching rookies on the tricks of the social media trade. He is a tireless facilitator, desiring for everyone to know everyone else. All that said, I'm sure he has the willpower to keep silent for a day -- but just barely."

Vadim Lavrusik, who just left Mashable to become journalism program manager of Facebook, had a devilish take on what might transpire tomorrow.

"I think that secretly, he will create a fake Facebook page for something entertaining and grow a following of a million people, all while being anonymous. We will never know," he told me.

Computer in the Delivery Room

Perhaps the person who best appreciates the degree of difficulty is Sreenivasan's wife, Roopa Unnikrishan. She awakened her husband on Sunday night when she heard the news about Bin Laden. And she remembers well that in 2003, when she gave birth to twins, Sreenivasan got permission to have his computer in the delivery room, "although he was mostly focused on video."

Andrew Lih, an associate professor at the USC Annenberg School of Communication and Journalism, takes credit (or blame) for getting Sreenivasan involved in Internet journalism back in 1995 and he remains skeptical.

"Asking Sree to step away from social media communication?" Lih said. "You'd have better luck getting TMZ to ignore Lindsay Lohan and Charlie Sheen for 24 hours."

But Daniel Dubno, founder of the consultancy Blowing Things Up and president of the Hourglass Initiative, thinks there might be a future in "Silence Sree."

"Perhaps next year, if he survives this challenge, he might give up the use of his iPad, Android, video chat, TV appearances, radio interviews, blogging, flogging, emailing, Gmailing, and the like," Dubno said. "But I still wouldn't take away his Xeroxing, faxing, Morse-coding, semaphore flag-waving, and his potential for nailing 95 theses on some door."

Ironically, Sreenivasan is organizing the first Social Media Weekend at Columbia from May 13 to 15. It's a good thing he won't be silenced then.

Carla Baranauckas is a freelance journalist, director of Round Earth Media and adjunct professor at Columbia University Graduate School of Journalism. She made a small contribution to the "Silence Sree" campaign.

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November 15 2010

14:06

The Pros and Cons of Using Kickstarter to Fundraise

We recently ended our first big fundraising drive for the LocalWiki project and wanted to take a moment to step back and reflect.

In particular, we'd like to talk about the funding platform we used, Kickstarter, and its advantages and disadvantages. While we already had a grant from the Knight Foundation to develop the LocalWiki software, we need to raise more money to go beyond just the software and help us do community outreach, coordination and education to ensure our project's success.

What is Kickstarter?

Kickstarter describes itself as "a new way to fund creative ideas and ambitious endeavors." It works like this:
  1. You post a project description on Kickstarter. You make a pitch video. The video isn't a strict requirement, but almost all funded projects have a video. You come up with a set of "rewards" for different pledge levels on the site. You set a funding goal and a time frame for your project.
  2. Kickstarter staff look at your proposed project and provide feedback. Then they (hopefully) approve your project and it's posted on the site.
  3. Your project goes live.
  4. If you don't hit your funding goal in the specified time frame, no one's cards get charged and you don't receive any of the funds.

Sounds simple enough, right?

An almost remarkable percentage of Kickstarter projects reach their funding goal. How's this possible? There are a few reasons why Kickstarter appears to be such a successful fundraising platform.

1. Staff Filtering

As mentioned before, the Kickstarter staff review postings before they appear on the site. In our case, it took a few days of back-and-forth with Kickstarter staff for our project to get a green light.

In our case, Kickstarter staff were concerned with our initial reward selections. Kickstarter wants you to have a rich selection of rewards that provide a lot of value to pledgers. For instance, something that seems like it ought to be worth $50 should be priced as close to market value as possible in the reward selection. We almost gave up on using Kickstarter because the approval process appeared to be pushing us toward a reward selection that would really cut into our real, post-reward funds.

That raises another important point: Kickstarter staff wants your project to succeed. Their filtering process helps Kickstarter ensure high quality (lots of successful projects!) and also lets them push project creators to maximize their chances of success (well priced rewards!). The main reason Kickstarter staff wants your project to succeed, though, is because Kickstarter takes a 5 percent cut of your funds.

So, in our case, we ended up paying Kickstarter $1,316. That's fairly significant, but it may be worth it.

2. The Kickstarter "Mold"

Launching a Kickstarter project means you're going to have to do certain things if you want to meet your funding goal:
  • Produce a video about why you want to raise money. This helps you focus your message into a couple minutes. This helps you fundraise.
  • Write about, and provide updates, why you want to raise money. Again, this forces you to focus your message.
  • Widely publicize your project. This is magnified by the next point ("All-or-nothing").
Your project will also be sitting alongside lots of other interesting projects, so just "hanging out" on Kickstarter may help your fundraising effort seem more legitimate. However, you may not get many pledges from traffic originating from Kickstarter.com -- this really depends on what type of project you have. In our case, probably 90 percent of our pledges came directly from folks browsing Davis Wiki.

Having to fit into this mold means you're going to have to do the kinds of things that organizations that fundraise successfully do. Which is great, because you might not have done all these things otherwise.

3. User Interface

When we decided to launch our outreach/education fundraiser we didn't have a lot of time to prepare a fancy fundraising site. We knew the Knight Foundation grant announcement would generate a fair amount of press and we wanted to capitalize on that excitement and energy. We had a couple days before we had to be in Boston for the announcement and most of our time was spent making our fundraising video. So having a pre-built, well designed fundraising site like Kickstarter really helped us.

Here's what you see when you click the usual Paypal "Donate" button on our site:


and here's what you see when you click "Pledge" on Kickstarter:


While we could have crafted our own pledge drive interface on top of a payment gateway, using Kickstarter saved us a lot of time.

4. All Or Nothing

Kickstarter pledge drives are "all or nothing," meaning that if the goal isn't met by the specified time then no one's credit cards are charged and the project doesn't get any of the pledged funds.
 

Surprisingly, the all-or-nothing nature of Kickstarter is its greatest asset in ensuring projects hit their funding goal. Once a project has reached a certain threshold of funding, the project creators (and pledgers!) feel an intense desire to "unlock" the money. In fact, word has it that something around 90 percent of projects that reach 25 percent of their funding goal are eventually fully unded.

Having projects be all-or-nothing was probably a decision made by Kickstarter to support projects that need to meet a concrete goal, such as printing the first major run of a new book. These are, by and large, the sort of projects Kickstarter excels at funding -- projects where, if a certain amount of money isn't raised, the project simply isn't possible, or isn't worth it.

But what about projects that deviate from this format? Projects that need to fundraise money but aren't goal-or-doesn't-matter? For more general fundraising projects, the all-or-nothing property has an interesting effect: It functions as a sort of "matching donation" multipler. In traditional fundraising, matching donations -- where an individual or organization pledges to donation $X but only if $X is raised independently -- are a common and successful way to drum up contributions. With Kickstarter, a donation of $50 with a $10K goal can be thought of as being "matched" by 199 other $50 contributions!

The all-or-nothing characteristic is a way to create a big "matching donation" pool and helps drive pledges even for projects that could make do with less than their goal amount.

Drawbacks

It's not all milk and honey, though. There are some hidden drawbacks and costs to using Kickstarter.
 

Fees

Kickstarter takes a 5 percent cut of your pledges and Amazon will take an additional amount (around 2 percent) on top of that. If your margins are slim, this could be significant.

You should think about it like this: I'm paying Kickstarter 5 percent of my pledge goal if we make it. Is the Kickstarter service worth the 5 percent? In particular, you should think about 1) The pre-built platform you get with Kickstarter; 2) the publicity of being on Kickstarter; 3) the "mold" that Kickstarter forces you into and the value of that.

#1 is worth it if you don't have a lot of time or resources to build something yourself. We certainly didn't.

In some cases, #2 is really valuable. Obscure, quirky projects can get amazing press just by being a part of Kickstarter. But if you're doing something more like a traditional community-based fundraiser you probably won't get much from #2. For us, the publicity of being on Kickstarter didn't drive a lot of pledges, but it did give us some valuable exposure.

I think everyone can benefit from #3 unless you're a large organization with a track record of successful fundraisers. In that case you've already got methodology, fundraising materials, and probably a big existing donor base.

It's hard to take Kickstarter fundraising offline

We held a couple of offline events during our pledge drive (a bar night and a silent auction). Unfortunately, it's pretty difficult to move offline funds back onto Kickstarter. You're not permitted to "pledge" toward your own project, which means you need to find a trustworthy third party to agree to pledge any offline funds. This also means the offline donors won't be noted on Kickstarter.

For local community-based fundraising efforts this can be problematic.

The all-or-nothing system is a bit confusing

Unfortunately, the all-or-nothing pledge system can be a bit confusing. Many folks we talked to thought they had already given us money before we hit our funding deadline.

Our fundraising period was 90 days -- the longest allowed by Kickstarter -- and so there were lots of people who'd simply forgotten they'd pledged by the time their cards were charged. Thankfully, Kickstarter is astonishingly good at collecting funds (they pester pledgers with an email every day for a week if their card is declined), and we only saw a few pledges that never came through.

Many successful projects are basically product sales

Despite the perception of Kickstarter as a fundraising site, a large number of high profile Kickstarter projects are, at their core, product sales. What do I mean by product sales?

Well, all Kickstarter projects have rewards. And unless you get remarkably lucky, you're going to have some cost associated with acquiring, shipping, and dealing with that reward. For folks in the non-profit world, we're all very familiar with the standard tax-deductability formula that's on donation receipts:

(Amount contributed) - (Value of goods or services given to donor) = Deductible amount

This isn't just some tax mumbo-jumbo -- it tells that the donor intended to give at least the deductible amount to the organization or project itself. But this formula doesn't tell us everything. After all, oftentimes we get goods or services donated to us and then, in turn, give them away. We're still bringing in money, either way. So the important missing part here is the cost to us of those goods or services, right?

(Amount contributed) - (Cost to us of goods or services given to donor) = Our profit

The first formula is still useful for differentiating these "I'm basically selling something" Kickstarter projects from "I'm doing something amazing, help us!" projects. So let's call the first formula the "Donation amount" and the second formula the "Profit amount."

How do projects measure up?

Methodology: I calculated Profit and Donation amount by using my best guess of production cost and resell value of the rewards (to an interested party). For instance, a T-shirt is counted as having little or no value (unless the project is all about T-shirts). This is roughly how the IRS counts things.

I also subtracted estimated Kickstarter and Amazon fees from total profit. I also factored in over-pledging and "no reward" choices.

The following are projects I've heard about recently, either because they got widespread press or because they touched my social circle in some way:

  • Vuvuzelas for BP: Raised $6,846 with a pledge goal of $2,000. Estimated Profit: $5,437. Estimated Donations: $6,846. Profit percentage: 79%. Donation percentage: 100%.
  • NIMBY - Industrial Art and DIY Space: Raised $17,897 with a pledge goal of $17,255. Estimated Profit: $16,161. Estimated Donation: $17,823. Profit percentage: 90%. Donation percentage: 100%.
  • Hollaback!: Raised $13,560 with a pledge goal of $12,500. Estimated Profit: $12,241. Estimated Donation: $13,466. Profit percentage: 90%. Donation percentage: 99%.
  • Decentralize the web with Diaspora: Raised $200,641 with a pledge goal of $10,000. Estimated Profit: $135,905. Estimated Donation: $180,051. Profit percentage: 67%. Donation percentage: 90%.
  • Embodiment: A Portrait of Queer Life in America: Raised $12,568 with a pledge goal of $10,000. Estimated Profit: $11,397. Estimated Donation: $10,848. Profit percentage: 90%. Donation percentage: 86%.
  • Punk Mathematics: Raised $28,701 with a pledge goal of $2,400. Estimated Profit: $20,224. Estimated Donation: $17,225. Profit percentage: 70%. Donation percentage: 60%.
  • Power Laces: Raised $25,024 with a pledge goal of $25,000. Estimated Profit: $12,429. Estimated Donation: $12,904. Profit percentage: 50%. Donation percentage: 51%.
  • Designing Obama: Raised $84,613 with a pledge goal of $65,000. Estimated Profit: $24,717. Estimated Donation: $30,010. Profit percentage: 29%. Donation percentage: 35%.
  • Coming and Crying: Real stories about sex from the other side of the bed: Raised $17,242 with a pledge goal of $3,000. Estimated Profit: $10,773. Estimated Donation: $6,144. Profit percentage: 62%. Donation percentage: 35%.
  • Glif - iPhone 4 Tripod Mount & Stand: Raised $137,417 with a pledge goal of $10,000. Estimated Profit: $98,950. Estimated Donation: $15,467. Profit ratio: 72%. Donation ratio: 11%.
  • Lockpicks by Open Locksport: Raised $87,407 with a pledge goal of $6,000. Estimated Profit: $64,043. Estimated Donation: $4,922. Profit percentage: 73%. Donation percentage: 6%.

This is hardly a proper random sample, and all of these projects were successfully funded. Many projects on Kickstarter never reach their funding goal. Unfortunately, it's difficult to search Kickstarter for unsuccessful projects for more data points.

Additionally, there are other costs associated with shipping rewards and time spent drumming up pledges, processing shipments, etc. Theses costs weren't included, but some costs (like time) are very real.

Conclusion

So, is Kickstarter good for running fundraising drives? Well, let's take a look at this graph:

That big spike is the Diaspora project, which had a few extraordinary factors working in its favor -- perfect timing, massive public backlash against Facebook, and a huge NYT piece. Ignoring that spike, it's clear that the projects which have the highest Kickstarter totals are those that are actually getting the least amount in donation-like pledges.

So while Kickstarter has many high-profile, successful pledge drives under their belt, the campaigns that raise the most cash tend to not look much like traditional donation drives.

All-in-all, we're happy we used Kickstarter. It helped us raise significantly more than we would have otherwise. It has drawbacks, though, particularly for non-profit organizations wanting to run somewhat traditional fundraising drives.

August 05 2010

15:29

Free Mobile App Lets You Accept Credit Card Donations

Square is a free mobile credit card processing app/device available for the iPhone, iPod Touch, iPad, and Android. Transactions are completed using the swipe device (also free) that plugs directly into a headphone jack and documented with receipts that can be sent out and stored online. Unfortunately as a result of the widespread excitement (see the Mashable article), there is currently a shortage of hardware devices, though their co-founder did recently travel to China to find a new manufacturer.

read more

July 09 2010

14:00

This Week in Review: Time’s non-pay paywall, free vs. pay in Britain and what to do with content farms

[Every Friday, Mark Coddington sums up the week’s top stories about the future of news and the debates that grew up around them. —Josh]

A Time quasi-paywall discovered: Thanks to some collaborative online sleuthing — OK, basically just wandering around on a website and asking some simple questions — we found out that Time magazine is planning an online paywall. Reuters’ Felix Salmon ran into the wall first a few weeks ago, but saw that it had disappeared by the next day. Then on Tuesday, the Lab’s Joshua Benton noticed it again, pointing out that this was an odd kind of paywall — one without any sort of way to pay online (“a paywall without a door,” in his words).

All Things Digital’s Peter Kafka got word the next day that the paywall is part of a company-wide strategy at Time Inc. to separate its print and iPad content from its online material. The Lab found out that Time does indeed have a plan to give that paywall a door and provide a way to purchase articles online, and The New York Times reported that this paywall sans pay is part of a gradual effort to retrain readers to pay for content online and noted that not everything from the magazine is gone from the website.

PaidContent’s Staci Kramer called the move not a paywall, but “the magazine equivalent of a condom” — a way to separate online readers from its print content. She noted that the move limits non-print access to Time to a very select group of people — namely, iPad owners. Essentially, it’s a hardware requirement to read Time magazine, something Publish2’s Scott Karp asked whether we’re going to start to seeing more of.

All Things Digital’s Kafka wondered why Time wouldn’t just offer its print articles for free if the magazine’s print and online audiences were as separate as they’re typically said to be. New York’s Chris Rovsar posited that the new wall is about protecting its $4.99 iPad app: If all your print stuff is available through the iPad browser for free, why buy the app? DailyFinance media critic Jeff Bercovici made the same point and argued that while Time may appear forward-thinking here, this move is really a regression. Newsweek’s Mark Coatney, a former Time staffer, was ruthless in his assessment of the strategy, saying that it all comes back to value, and Time hasn’t articulated why its print content is worth paying for, but its online stuff isn’t.

A paid-content contrast in Britain: Time was far from the only paywall news this past week: Three relatively small Gannett papers put up a $9.95-a-month paywall last Thursday, and the most important new paywall may have been at The Times of London and The Sunday Times, two of Britain’s oldest and most respected publications, which began charging for everything on their site last Friday. That development is particularly important because it’s the first move in the paid-content crusade that Rupert Murdoch has been gearing up for since last summer.

Steve Outing and Poynter’s Bill Mitchell noted that the Times’ paywall is among the most impenetrable we’ve seen yet in newspapers: All non-subscribers can see is the homepage, and even the headlines are blocked from online news aggregators. New York’s Chris Rovsar took stock of what The New York Times (planning its own paid-content system next year) could learn from how the Times rolled out its paywall, and basically, it boils down to, “Whatever they did, just don’t do it.” He and the Press Gazette’s Dominic Ponsford ripped the Times’ paid-content strategy, criticizing it for not being RSS-compatible, not linking, and giving away desperate-looking freebies. (Rovsar and Ponsford do acknowledge that the site is cheap and pretty, respectively.) British journalist Kevin Anderson used the Times’ paywall as an opportunity to light into the thinking that leads newspapers to charge for content online in the first place.

Meanwhile, the Guardian, another prominent British paper that is staunchly in favor of free online content, released a Wordpress plugin that allows blogs and websites to embed the full text of Guardian stories for free. (Steve Outing demonstrated with a post on the iPad.) It’s an unprecedented move, and one that made for a pretty easy contrast with the Times’ protectionist strategy online. Outing did it most explicitly in two posts, arguing that the Guardian’s strategy taps into a worldwide revenue potential, while the Times relies on its brand-loyal British readers. Murdoch “apparently still doesn’t understand that this whole pay-for-news-online thing is not about the needs of publishers like him. It’s about what the audience for news is willing to do and willing to pay for,” he wrote.

Learning from (and fighting with) content farms: Since acquiring the online content provider Associated Content in May, Yahoo has become the latest online media company to begin producing articles based on a calculation of search terms, including for its new news blog, The Upshot. The Wrap’s Dylan Stableford took a look at these “content farms,” focusing on why journalists hate them and what news organizations might be able to learn from them. (On the latter point, Stableford’s sources said content farms’ acute attentiveness to what people are interested in reading could be particularly instructive.)

One of the people Stableford quotes, NYU professor Jay Rosen, gets some extended time on the subject, and another, Jason Fry, posted some additional thoughts, too. Fry, who is quoted in the article as saying, “If you want to know how our profession ends, look at Demand Media,” clarified his stance a bit, saying that what bugs him is not the low pay, but the lack of quality. Still, he acknowledged that because of cost-cutting, many small- and medium-sized newspapers’ content is just as mediocre. Peter Berger, a CEO of Suite101.com, one of those content generators, said the concern from news organizations is a red herring, and his industry really presents the biggest threat to non-fiction books.

Canadian writer Liz Metcalfe voiced some similar thoughts, arguing that the problem with the “demand content” model isn’t the model itself, but the poor quality of what gets produced. Newspapers should find a way to incorporate the model while producing high-quality material, and beat the content farms at their own game, she said. On the other hand, Harvard prof Ethan Zuckerman said dictating content based on search would be a bad way to run a newspaper: “You’d give up the critical ability to push topics and parts of the world that readers might not be interested in, but need to know about to be an engaged, informed citizen.”

A private group called the Internet Content Syndication Council wants to do something about these dastardly villains, and they’re exploring a few options, including drafting a set of content-quality guidelines, licensing content syndicators and asking Google to tweak its search formula. CNET’s Caroline McCarthy wondered what a guideline or licensing system would do with bloggers.

Chronicling an accelerating shift to mobile: The Pew Internet & American Life Project released a couple of fascinating studies in the past week, the first on the future of social relations online and the second a survey of Americans’ mobile use. The latter study in particular turned up a raft of interesting statistics, led by the finding that 59 percent of adults go online wirelessly, including 47 percent of Americans with their laptops and 40 percent with their cell phones.

Poynter’s Mobile Media focused on the rise in “non-voice” uses for cell phones over the past year (Silicon Alley Insider has it in graphical form). The New York Times and Washington Post centered on the survey’s finding that African-Americans, Hispanics, young people and poorer Americans are among the heaviest mobile media users, with the Times stating that “the image of the affluent and white cellphone owner as the prototypical mobile Web user seems to be a mistaken one.”

Here at the Lab, Laura McGann seized on another tidbit from the study indicating that about a fifth of young adults have made a donation via their cell phone. She tied that finding to the public radio station WBUR’s attempt to find a way to allow users to donate via an iPhone app, something Apple doesn’t allow, asking how nonprofit news orgs might be able to find a way to tap into that willingness to give through their cell phones.

Reading roundup: Lots of really thoughtful stuff this week that’s well worth your time (I assume it is, anyway — maybe your time’s much more valuable than mine):

— The debate over objectivity and journalism raged on this week, fueled by the firing of CNN’s Octavia Nasr over a remark she made on Twitter. Many of the arguments circled around to the same ground we’ve covered with the Gen. McChrystal and Dave Weigel flare-ups, but I wanted to highlight three takes that stand out: Salon’s Dan Gillmor on America’s “technically good subservient press,” Jay Rosen on “objectivity as a form of persuasion,” and Mediaite’s Philip Bump on a journalism of individuals.

— Many new media folks have been following the fate of the nonprofit Texas Tribune, and the Columbia Journalism Review has a pretty definitive account of where they stand.

— ReadWriteWeb has a handy resource for zooming out and taking a look at the big picture — a summary of five key web trends so far at 2010’s halfway point.

— Spot.Us’ David Cohn takes a look at the short-lived journalism startup NewsTilt and comes away with some helpful lessons.

— Finally, Google researcher Paul Adams has a presentation on the problems with the way social media is designed that’s been making its way around the web. It’s a whopping 216 slides, but it’s a simple yet insightful glance at what feels just a little bit wrong about our social interactions online and why.

June 01 2010

14:00

Parsing Panera: Could a name-your-own-price model work for news?

The former CEO of Panera Bread recently announced an intriguing experiment: The chain’s store in Clayton, Missouri is doing away with prices. The Clayton franchise, now run as a nonprofit restaurant and renamed the “Saint Louis Bread Company Cares Cafe,” offers the same products as typical Panera stores, the same baked goods and soups and salads. Instead of assigning a monetary value to the products, though, the store leaves it to customers to decide what they’ll pay. “Take what you need, leave your fair share,” reads a sign above the store’s counter.

Name-your-own-price schemes like this aren’t new; often, they don’t work. (“If you use a PWYW scheme too liberally, you are courting financial disaster,” the economist Stephen Dubner points out. “Just imagine if Tiffany & Co. held a PWYW day on all diamond jewelry.”) But sometimes — under the right circumstances — the approach can be quite effective. At One World Everybody Eats, a community kitchen in Salt Lake City, Denise Cerreta runs an analog service to the Panera experiment: Instead of pricing the meals One World serves, she asks customers to pay what they can — and, she told me, “to pay it forward when they can.” She’s doing something right, it seems: One World’s been in business for seven years.

Which brings me to the question you’ve seen coming, but one I’ll come out and ask anyway, as a thought experiment if nothing more: Could the Panera payment model work for news?

Request, not demand

First of all, there’s plenty of evidence to suggest that it couldn’t. Carta, the German public-affairs publication, is currently the highest-grossing participant on the donation-facilitator site Kachingle. Carta’s current yield from Kachingler donations is $198.27 — from a total of 65 people. Oof. Membership drives both journalistic and otherwise tend to suggest specific notation amounts for a reason: We like prices. Or, more specifically, we’re conditioned to expect them.

But what if our expectations changed? What if news outlets built into their online interfaces a more structured, and systematic, request for content compensation? Take, again, One World. One of the reasons Cerreta’s effort works is that, at the cafe, consumer behavior is monitored: The kitchen has built into its physical layout what Cerreta calls a “point of accountability” — a point at which, moving through the consumption-to-satisfaction continuum, consumers know that this is the moment they’re expected to compensate the kitchen for what they’ve (literally) consumed. In One World’s case, the accountability point is a simple donation box. One that is situated — explicitly, purposely, unavoidably — in public.

And that makes a big — and perhaps all the — difference. (Recall the “Big Brother Eyes” experiment from a few years ago.) Which means that, when the accountability is negotiated in private — when there is only, as in the case of online news, the glare of the computer screen to cast light on our shoulders’ angels and devils — our willingness to drop dollars in the donation box certainly becomes a more open question. But, then, what if we took a looser approach to publicness — what if we translated Cerreta’s physical accountability point to the ephemeral interactions of the web? Even if we citizens need a little push to behave in private with as much civic sensibility as we would in public, there’s nothing to say that news outlets can’t provide — or, at least, experiment with providing — that push. It would simply be a matter of building the push into the structure, and patterns, of consumption. Of creating, to modify Cass Sunstein’s phrase, an architecture of accountability.

Step one would be re-framing the terms of the transaction when it comes to compensating news providers for the content they provide: from fee (obligatory, and therefore purely economic) to donation (optional, and therefore suggestive of social good). It’s a semantic shift, certainly; but it could be a psychological one, as well.

Take the work of Edward Deci. In a series of experiments in the 1970s, the social psychologist examined the behavior of two groups of subjects: One was asked to solve a puzzle; the other was told it would be paid for solving the same puzzle. Those who worked for what Deci called the “intrinsic” reward of solving the puzzle — the simple satisfaction of a job well done — were, he found, more successful in finding solutions than those who were paid. Payment functioned, ironically, as a disincentive.

Deci was studying the motivation to work, rather than the motivation to pay; still, his overall finding (officially, that “contingent monetary rewards actually reduced intrinsic task motivation”) is illustrative. Introducing the concreteness of payment into an otherwise more ephemeral exchange can sometimes discourage action, rather than encouraging it; assigning monetary value to goods and experiences has a way of confining — and even negating — their broader value. Pricing is practical, of course, and, for the most part, entirely necessary. Still, we prefer to think of ourselves as motivated by something other than — something more than — rote obligation. And price tags, general necessity notwithstanding, tend to rob us of our altruism.

Accountability and urgency

What Deci’s findings suggest for news is that, paradoxically, “It’d be nice if you paid” could actually be more incentivizing for consumers than the more blunt, and more transactional, “You have to pay.” Paywalls are one thing; pay doors, if you will — come on in! have a bite! pay what you think is fair! — are another. Permeability suggests trust; expectations of good behavior have a way of encouraging good behavior. Broken windows, in reverse.

Again, though, publicness (read: public accountability) is key; roughly the same number of people who want to be good citizens want to be recognized for being good citizens. Every year, I receive a series of emails from my college (usually featuring a slick little slideshow: “Campus in the Fall,” “Campus in the Spring,” “Campus in the Summer, with Children and Puppies and Rainbows”) asking for contributions to its Annual Giving drive. And it usually takes several of those emails before I actually make my donation. It’s not that I don’t want, or for that matter intend, to give back; it’s just that the give-back ask lacks urgency. The payment isn’t a demand; it’s a request. It doesn’t have to be paid now; it can be paid whenever. And that decelerates the dynamic of the transaction.

One of the most recent emails I received, though, tapped into something other than nostalgia: It featured a long list of donors from my class — ostensibly, as a way of thanking them for their contributions by way of public acknowledgment…but also, of course, as a way of highlighting those who hadn’t yet contributed. The loud, empty space between ‘Ganson’ and ‘Geannette,’ I have to say, made for an excellent disincentive against future dallying. Suddenly, the urgency was implicit.

The Alumni Giving staff, in other words, built into their donation request a point of accountability. Not a virtual cash register, a “pay now, or you won’t get the goods you want” approach — an impossibility for donation-seekers who sell not goods but potential good — but a more subtle (and, yet, just as impactful) message: “pay now, or everyone will know you haven’t paid.” Social capital is an economic good as much as a civic one; the AG donation-seekers wove that fact into their email so implicitly that their request suddenly bore the semblance of demand. By highlighting the social, rather than the monetary, aspect of their appeal, they conveyed the fact that they meant business. Literally.

Leveraging the social economy

When it comes to the problem of monetization, we sometimes to fall into the trap of equating “pay model” with “pay wall.” We assume that news is a straight commodity, and that the cash register model is therefore the only viable option for monetizing it. (“We’re not NPR, after all.”) But the commodity-focused approach ignores the social aspects of media economics. Particularly online, with the web’s built-in mechanisms of mutuality, news is a social good as much as (and perhaps even more than) a product to be bought and sold. It is also an experience good — something that needs to be consumed before its value can be accurately determined. A tip-based model — which combines reward for a job well done with the social prestige of being generous enough to leave a tip in the first place — actually makes more sense than a paywall, which is necessarily predictive in nature.

Cerreta’s name-your-own-price experiment, and my Alumni Giving’s public-accountability approach — not to mention the experience of, yes, many a public media membership drive — suggest the raw potential of a request-oriented, rather than a demand-oriented, approach to the pay-for-news problem. They hint at what might happen when we bring a little humanity to paid content’s practical, yet wholly impersonal, business proposition. Most of us, after all, are much happier to make donations than to pay bills. Even if the checks we write are for the same amount.

That’s not to say that reframing the terms of transaction is a broad answer to the seeping problem of content monetization; “no silver bullets” has become a common refrain for a good reason. (Plus, as Laura Walker, president and CEO of WNYC, told me in a conversation about PWYW’s scalability, “I think there is a much stronger pull toward supporting an organization that is not supported by advertising — that is not there to deliver an audience to advertisers — but is there because of a mission. I think that’s why people value us.”) It is to say, though, that it may be worth widening the scope of consideration when it comes to how we think about payment structures in the first place. The many experiments we’re seeing with social media right now — HuffPo’s implementation of recognition for committed community members, Gawker’s star commenter system, Spot.us’s and Kickstarter’s public donor lists, Foursquare’s merit-badge framework — leverage users’ cultural connection to the news — and their desire to be recognized for, essentially, good citizenship within the cultures news systems create.

What would happen if those same motivations were employed in the service of monetizing online news? What would happen if we shift our focus from transactions to exchanges? Kachingle may not have revolutionized online payment structures; then again, its digital tip jar is a rare presence on websites. But what if The New York Times — or The Washington Post, or The Huffington Post — had its own kind of Kachingle? What if it also had a badge-like way of praising, publicly, the people who had financially supported its services? What if, instead of erecting a paywall, it built its site on an architecture of altruism?

It’d be an experiment, certainly. An experiment that well might fail. Still, though: I’d love to see what would happen if we broaden our notion of what a viable pay model could be.

May 17 2010

11:20

TechSoup Webinar: Make it Easy to Give By Taking Online Donations

Are you interested in taking online donations, but not sure where to start? This can be a very confusing process, with many options and it’s not easy to determine what the best solution is for your nonprofit or library. Attend this free webinar and learn about the different ways that you can raise money online and the tools to make it safe for your donors.

We will talk about ways to take donations, learn about related products that TechSoup offers, specifically Comodo, and hear about organizations using those tools.

This webinar is ideal for decision makers, development directors, website managers, or anyone interested in learning more about taking online donations.

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