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Why Online Fundraising Auctions Work
By: Jon Carson

$3,300 for a junior to have her own parking spot! $850 for a teacher to help organize a student’s college applications! One parochial school raised nearly $30,000 through a single online fundraiser.

Online fundraising auctions are working—and parochial schools are increasingly adopting them to raise more money for financial aid, professional development, technological improvements, and more. Schools from coast to coast are finding online auctions uniquely effective in uniting widely scattered alumni and strengthening their long-term loyalty.

Easy-to-use online auction tools and templates also make it possible for schools with small staffs to hold fundraisers with a highly professional look and feel on a shoestring—truly doing more with less. In fact, nonprofit organizations, which have traditionally raised billions of dollars annually through silent auctions at live events and galas, now are supplementing them or, in many cases, altogether replacing them, with online auctions. The move eliminates inefficiencies, enables alumni to participate no matter where they live, engages an entirely new audience of cause-minded bidders to participate, and raises additional dollars.

Christian schools are making online auctions a fundraising staple. A Jesuit high school in Cincinnati, for instance, raised nearly $49,000 and is currently planning a second online fundraiser. A K-8 school in Northern California raised $27,000, with the highest bidder spending more than $2,000. The school is now hoping to beat these totals with another auction this spring.

The Power of Online
Moving an auction online has four key advantages.

First, it removes the barrier of geography. If key alumni or parents live far away, they can still participate. And, donors aren’t restricted to students, alumni, and faculty anymore. Once an auction moves to the Internet, Christian schools have a new chance to reach and engage cause-minded bidders—whether they’re nearby or in another state.

An online auction also removes the barrier of time. These events run 24/7 for several days before a live event, and often a few days afterwards, so if donors have a conflict or would rather just stay home the night of a live event (and roughly 40 to 70 percent do), then they can still participate and push the latest bids for particular items ever higher. (Only 10 to 30 percent of an organization’s constituents are usually available to attend live events because of conflicts that become irrelevant when an auction moves online.)

Online auctions are highly measurable, producing valuable information around what item categories get bids, the best ways to set opening bids, etc. And that information gives schools a business intelligence roadmap, which means that they can constantly improve results from event to event.

Also, moving online eliminates or at least dramatically reduces the often-painful logistics of a live event.

“Try managing 15 silent auction volunteers, lugging 150 items into a room, setting them up, taking unsold items back to the office late at night, and dealing with long checkout lines—it isn’t easy,” said Judi Elkin, a seasoned fundraiser.

By holding an online silent auction for one to two weeks surrounding a live auction event, a school reduces the workload, as well as staffing and volunteer requirements, for the “big day.”

Interestingly, 74 percent of online charity auction bidders are women. In a recent focus group, women repeatedly cited the desire to avoid crowds around the silent auction clipboards. In essence, without an online auction element, you may be sub-optimizing a key demographic.

Boosting Bids through Competitive Arousal
Parochial schools and other nonprofits are also finding that online auctions trigger competitive arousal (the drive to outbid others) in ways that silent auctions typically can’t. The distractions of a live event—food, friends, entertainment—often relegate clipboards with the latest bids to the sidelines. Clipboards don’t exactly get off the table and follow you around the room when you have been outbid, but online auctions immediately send you a bid alert when the competition is heating up.

When an organization goes online, an effective way to drive continual Web traffic is through e-mail campaigns. And, that applies to online auctions, where there is now a wealth of research on how to use e-mail to encourage more and higher bidding. Data abounds on when a competitive e-mail message will drive bidding, and when a more altruistic message is best. Christian schools are using these data to schedule e-mails that power up the bidding process.

Increased Supply
Going online also improves the effectiveness of item solicitation. In today’s more competitive economic climate, the school has a stronger value proposition to take to commercial entities. Donors can have a clickable link and logo in their online auction catalog to increase their visibility. And, they can enjoy a sizable number of guaranteed impressions before prospects they want to reach in a meaningful way.

Summing It All Up
When a fundraising auction is put online, it enables a broader base of bidders to participate over a longer period of time, and that means more money raised. Moreover, because of the gaming aspect of online auctions, they are viewed by participants as a uniquely enjoyable way of fundraising. In addition, an online auction provides item donors significant, quantifiable marketing benefits that they have heretofore not had. The school can leverage its e-mail list to efficiently source new items through a virtual item acquisition campaign.

Parochial schools can also give corporate sponsors another element of marketing value, which they can charge for or use to lock in a sponsor renewal. Lastly, an organization can take the robust information that is generated from an online auction to begin optimizing for the next auction, providing ever greater revenue yields down the road.

It’s a new world out there, and in this environment, fundraisers need the best toolbox available—and that toolbox is incomplete without an online auction component. The benefits are just too compelling, making it a prudent bet that most Christian school fundraising auctions in the future will have an online component. Auctions work. The sooner you begin, the sooner you will enjoy a competitive fundraising advantage and take your auction strategy to a whole new level.

Jon Carson is chief executive officer of cMarket, a leading online auction platform solely for organizations engaged in fundraising for nonprofit and educational causes, www.cMarket.com.

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