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Apps are changing how people give. What that means for donors and charities
In a world where convenience is king, app developers and charitable organizations have been teaming up to make donating as easy as possible.
Some apps are even making giving into a kind of game in an effort to solicit more donations.
By making giving simple and fun, nonprofits hope to catch the attention of millennials, who regularly use their smartphones to spend money.
With a tap of a finger and just 50 cents, donors can feed a child through ShareTheMeal, an app funded by the World Food Programme that aims to tackle world hunger.
Users have the choice to donate more than 50 cents and can join "the table," a monthly giving community that allows users to receive updates from families who benefit from their donations.
The World Food Programme reports that people are donating an average of seven dollars via the app. ShareTheMeal has set a goal of reaching 60 million meals shared by mid-December, equating to $25 million in the four years since it was launched.
"Nearly 75 percent of our users are millennials," said Camaley Jennings, the marketing manager for ShareTheMeal. "The millennials are who we're targeting and who we've seen most positive feedback with thus far with the product."
Research on how millennials donate using apps is sparse, but anecdotal evidence suggests they are more likely to use an app to donate to a charity because "it's appealing, quick, usually only involves small amounts of money and activity is easily shareable with friends and family," said Daniel Borochoff, president of CharityWatch, a nonprofit organization that rates and evaluates charities.
While, older adults are likely to have already-established giving routines, millennials, who are now in their prime working age, are ripe for attracting nonprofits' attention.
On the other hand, millennials, many of whom entered the workforce during the Great Recession, earn less money than previous generations, so apps that offer a chance to donate while sticking to a tighter budget can also be appealing.
Coin Up does that by turning daily expenses into a monthly donation. The app rounds up credit and debit card transactions and donates the extra money to a charity.
"If you go to the coffee shop and buy a latte for $4.20, the app will start to calculate the $.80 'round up' to the next dollar," said Leena Patidar, CEO and co-founder of Coin Up.
At the end of the month, Coin Up totals up users' 'spare change' and charges their credit or debit cards for the total amount. Users can also set a limit so they aren't charged a surprisingly high amount.
Users can choose to donate their "spare change" to over 250 charities. Patidar said donating through an app is more convenient and more engaging for the donor, which builds loyalty over time.
Charity watchdogs warn there are downsides to making donations made through apps.
For one, apps can be costly to maintain, which adds to nonprofits' overhead costs.
Donations made through apps are also typically small-dollar and sporadic.
"There's something about [an app] that seems more fickle," said Patricia Snell Herzog, an associate professor at the Lilly Family School of Philanthropy at Indiana University. "Like it's a little too easy, and it becomes kind of interchangeable with other things that people do."
Borochoff said if charitable giving apps are to be successful they should serve as a "gateway" to get users to commit to larger, monthly or annual donations.
"While one can feel good about using charity apps, they should not be viewed as a replacement for making more substantial donations directly to charities," he said.
Here are a few other charitable apps donors are tapping into:
WoofTrax allows people to support an animal charity by simply walking their dog. Users accumulate points for every walk that is recorded by the app.
Users can then dedicate those points to their charity of choice. The more points a charity gets, the more likely they are to win a donation in a kind of raffle contest that is sponsored by companies in the pet products and pet health industries. This app for animal lovers aims to not only promote a healthy lifestyle for pets and their owners but also bring attention to the needs of local non-profit animal shelters and rescues in the United States.
"Giving pet parents the chance to earn a donation with each walk is the incentive that makes the app game-like and memorable," Doug Hexter, CEO of WoofTrax said.
In about four years since it launched, WoofTrax has been downloaded more than 1 million times and has logged over half a million walks per month.
Another app that belongs to the World Food Programme is a free educational game called Freerice. Users raise money by testing their knowledge in various categories such as math, geography, English vocabulary, languages and more.
Advertisements that pop up on screen while playing the game generate money that goes directly to the World Food Programme where it is used for various types of assistance. Since 2010, Freerice has raised more than 201 billion grains of rice for people in need, equating to $1.39 million.
Alia Zaki, community and social media manager for Freerice said the app is especially appealing to younger generations who are digital natives.
"For a generation that is socially conscious and spends high amounts of time online, Freerice offers a cost-free digital solution for doing good, and offers it in a familiar form: a web/mobile trivia game," she said.
The game was originally developed as a desktop website, but can now be played on the app, allowing more flexibility for users.
Freerice brings in around 620,000 users every month, a majority of them being under the age of 25.
The concept of Buengo is simple: sell items that you don't need anymore and donate your earnings to a charity. Users get to choose how much they want to sell an item for and which charity receives the money.
The app is currently only available in the United Kingdom, but it expects to launch in the United States next year.
Fela Hughes, CEO and co-founder of Buengo, said the company is looking to expand beyond selling second hand items and make opportunities to sell services as well.