Yes, More Facebook Friends Are Asking You for Money
Posted December 26, 2017 6:17 p.m. EST
Perhaps your college friend asked you to support her quarterly magazine for her birthday. Or maybe your neighbor nudged you to donate to his favorite food bank on “Giving Tuesday” the week after Thanksgiving. And then there’s that pesky public-health nonprofit you’ve been charitable to in the past.
If you’ve gotten on Facebook at all this year, you’ve probably been asked to give money. And if you’re like many users, your newsfeed became particularly overrun by fundraisers during the last month or so.
How did we get here? And at what point did Facebook become a hub for this sort of thing?
It all started innocuously enough — with a modest “Donate” button.
— How Did Facebook Get Involved in Fundraising?
When Facebook rolled out the new button in 2013, it allowed people to contribute directly to nonprofits through the social media platform for the first time. At the outset, 19 organizations were listed as partners.
About two years later, officials began testing another new tool: Fundraisers. Using that feature, in tandem with an improved donate button, about three dozen organizations now had a place from which they could raise money for a campaign. And by June 2016, Facebook announced it would expand its Fundraisers tool to allow users themselves to raise money for more than 100 nonprofits in the United States.
Less than five months later, that group of 100 was expanded to more than 750,000. Facebook teamed up with the Bill & Melinda Gates Foundation. Together, they pledged to contribute up to $1 million to Facebook Fundraisers — $500,000 from the foundation in matching funds and $500,000 in waived fees from Facebook.
But they weren’t done. In August, the company announced that users in the United States would be able to create fundraisers in honor of their birthdays.
A high point was Giving Tuesday 2017. The Tuesday after Thanksgiving in the United States has become a focal point for donations on social media in the past five years. In an apparent attempt to raise the bar, the Gates Foundation increased its matching contribution this year to $1 million. Facebook covered all the fees for the day.
— What’s This About Fees?
Before the Giving Tuesday promotion, Facebook took a 5 percent cut of the donations, according to media reports and archived versions of its informational pages.
When Giving Tuesday arrived, the company did away with the fees, and then, the next day, officials announced that those fees would be eliminated moving forward. (Donations made to personal fundraisers — like for a medical emergency — are still charged a 6.9 percent fee in the United States and are generally not tax-deductible.)
— Do People Like It?
In interviews, some Facebook users worried that it would take too long for nonprofits to get their donations. Others groused that inviting friends to donate one by one was time consuming. And a few said they were confused about whether they would be charged a service fee.
Still, users overwhelmingly said they were amazed by the ease, simplicity and effectiveness of fundraising on Facebook. A Washington, D.C., woman said she started a fundraiser by accident and raised almost $500 in hours. Many said they were stunned by the number of people who donated — particularly extended family members — even though they are seldom in touch.
Kelly Hewitt, 31, of Chicago, saw the banner advertising the Gates Foundation match this year and decided to open her first fundraiser. So many donations poured in that Hewitt had to increase her fundraising goal — twice.
“I do think it’s a really powerful tool that connects people,” she said of Facebook. “If it can be leveraged to do something great like this, then I don’t know why we wouldn’t use it.”
— Is Facebook’s Effort Part of a Bigger Plan?
In its news releases and presentations, Facebook has framed the development of its Fundraisers tool as part of a broader effort to do “social good.”
Experts said that may be true. But they say there is almost certainly another motivation, too.
Keith A. Quesenberry, an assistant professor of marketing at Messiah College in Mechanicsburg, Pennsylvania, said the social network needs to increase the amount of time users spend on its site if the company hopes to keep increasing its revenue. That’s part of the reason Facebook has pushed native video, and probably part of the reason it built a platform that allows users to donate without leaving the site, he said.
Fundraising platforms such as GoFundMe have always relied on social networks to make campaigns successful, added Jeremy Littau, an associate professor at Lehigh University in Bethlehem, Pennsylvania, who studies social networks and civic action.
“This is Facebook deciding they’re no longer happy playing a middleman role,” he said.
Both Quesenberry and Littau said they consider Facebook’s decision to eliminate the donation fee to be a bold business move aimed at taking more market share and potentially putting competitors out of business.
“Any features that are popular on other networks, they just end up adopting,” Quesenberry said of Facebook. In an email on Tuesday, Stephen Rocco Rodi, a spokesman for Facebook’s social good team, said that giving is growing — and having more options will help.
“People have always come together on Facebook to support the causes they care about, and we build products to make that easier,” he said. “We’ve seen people raise money for disaster relief, education, the environment and for friends and family in need. Our goal is to help make this even easier for people who are already using Facebook for this reason, and for people who want to support causes they care about on and off Facebook.”
— How Do Competitors Feel?
A spokeswoman for GoFundMe, which claims to be the world’s largest social fundraising platform, said in an email that its community has continued to grow “despite new competition.”
That community includes more than 50 million people, the spokeswoman said.
GoFundMe does not charge what it calls a “platform” fee for new personal fundraising campaigns based in the United States. But it does charge an “industry-standard payment processing fee to accept credit cards” of 2.9 percent.
“In addition to growing our core business in the U.S., we are also rapidly expanding into new international markets as well as the charity fundraising space,” the company spokeswoman, Kelly R. Galvin, said in a statement.
— Having It Both Ways
Gabi Jubran, 28, of Menlo Park, California, was planning on running a Giving Tuesday campaign for the nonprofit organization he recently founded.
Since Jubran’s organization is in its infant stages, he worried about how long the money might stay in limbo if he used Facebook to raise funds. So he chose a different platform, Classy, and added a “Donate” button to his nonprofit’s Facebook page that redirected users to the alternative platform.
(Facebook says it takes about two weeks to pay out charitable organizations that are registered with the site’s payment system; it can take closer to six weeks to get a check to nonprofits that aren’t registered.)
Jubran soon found that when friends clicked the donate button on Facebook, the social network displayed a pop-up box forcing them to click again if they wished to leave. And when he posted a video about his organization on its Facebook page, Jubran discovered that although the video got more than 5,000 views, far fewer people departed Facebook to visit his nonprofit’s site.
Knowing all this, Jubran is now contemplating a change in strategy. Instead of raising money exclusively on Classy and ignoring Facebook Fundraisers, he concedes, “I may end up just doing both.”