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Fundraising Tuesday: The End of AmazonSmile (Everything Nonprofits Need to Know)

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A guest post by Korri Piper at ShopRaise

Online shopping and online fundraising have both grown in popularity in recent years, leading to major changes for both for-profit businesses and nonprofit organizations. Shoppers not only gravitate toward online retailers, but they’re also interested in making a difference through their purchases.

In 2013, Amazon.com came up with a solution that combined all of these trends: AmazonSmile.

AmazonSmile provided a convenient way to donate while shopping online. The small contributions from this easy-to-run passive fundraising program added up over time to aid the fundraising efforts of more than a million organizations. However, on January 18, 2023, Amazon announced they would be discontinuing the Smile program on February 20.

In this guide, we’ll explain everything you need to know about the discontinuation of AmazonSmile and its effects on nonprofits like yours by answering the following questions:

  • What was AmazonSmile?
  • Why was AmazonSmile discontinued?
  • How has the end of AmazonSmile affected nonprofits?
  • What next steps can nonprofits take?

What was AmazonSmile?

Founded by Amazon.com as one of their business philanthropy initiatives, AmazonSmile was a program that allowed shoppers to give back to their favorite nonprofits while making everyday online purchases. Shoppers could conveniently contribute through purchases that they were going to make anyway at no additional cost. Plus, they could support a wide range of nonprofits, from enterprise-level groups to the smallest community organizations.

For nonprofits, AmazonSmile provided a free, easy way to bring in extra revenue all year long. The program did have its disadvantages, such as its low commission rates—just 0.5% of a supporter’s total purchase went back to the nonprofit. Also, shoppers could only contribute through purchases made on Amazon.com, and nonprofits couldn’t view data on which supporters participated, making it impossible to thank those donors individually. But it was a creative idea that kept supporters engaged and supplemented countless organizations’ annual fundraising efforts.

Why was AmazonSmile discontinued?

In their news release about the end of AmazonSmile, Amazon.com announced that they would be focusing their philanthropic efforts on other programs. Because more than a million organizations participated in AmazonSmile, the business’s leadership said they felt like their “ability to have an impact was often spread too thin.”

The move came alongside other cost-cutting measures for Amazon.com, including widespread layoffs. However, during the transition, Amazon.com has pledged to donate the equivalent of three months of AmazonSmile revenue to each participating organization based on their 2022 earnings. They will also continue to encourage nonprofits to ask for in-kind donations by sharing their Amazon wishlists with supporters.

How has the end of AmazonSmile affected nonprofits?

Despite Amazon’s pledges to ease the transition, many nonprofits have already shared how the discontinuation of AmazonSmile will affect their fundraising. Small to mid-sized organizations in particular pointed out that the ongoing revenue stream made a major difference in their ability to further their mission with limited resources. The discontinuation also eliminated an accessible way for supporters to give to these organizations.

This transition has affected nonprofits’ financial planning as well, particularly because of its timing. According to Jitasa, most nonprofits create a new operating budget at the end of each fiscal year so it can be approved before the next fiscal year begins. Nonprofits whose fiscal year follows the calendar year had likely already finalized their operating budgets when Amazon made the announcement. Learning in January that one of their revenue sources would be discontinued in February has left little time to figure out how to replace that funding.

What next steps can nonprofits take?

The approach to and timing of AmazonSmile’s discontinuation leaves a gap in many nonprofits’ fundraising strategies. If your organization is among those, you’re probably considering how to make up the ongoing revenue you’ll no longer receive. Fortunately, there’s a free and easy solution available: partnering with a dedicated online shopping fundraiser program.

How Online Shopping Fundraiser Programs Work

Participating in an online shopping fundraiser program works similarly to AmazonSmile. Supporters can contribute to your nonprofit as they make everyday online purchases. But rather than being tied to a specific retailer, these programs leverage a wide partner network of e-commerce businesses. When a supporter shops at any participating retailer using the program’s app or browser extension, a percentage of their purchase goes to a nonprofit of their choice.

ShopRaise’s guide to shopping for a cause explains how your organization can get started with an online shopping fundraiser program in three easy steps:

  • Sign your nonprofit up. The program’s fundraising experts will walk you through a simple onboarding process, answer any questions you may have, and handle all negotiations with retailers for you.
  • Market your fundraiser. If your organization is switching from AmazonSmile to a new online shopping program, you’ll need to make supporters aware of the change and regularly remind them to use the app and browser extension as they shop online. The online shopping fundraiser program can help with this step by creating branded flyers, email templates, and other marketing materials for your nonprofit.
  • Track your results. You’ll be able to view real-time fundraising data, allowing you to thank your top supporters individually and see how their contributions add up to make a difference for your organization.

Once your organization is onboarded, online shopping fundraisers are fairly hands-off. All you’ll need to focus on is marketing and tracking results.

Benefits of Online Shopping Fundraiser Programs

Besides helping fill the gap created by the discontinuation of AmazonSmile, online shopping fundraiser programs have several other benefits for nonprofits like yours, including:

  • Bringing in unrestricted funding. You can put the contributions from your online shopping fundraiser toward any area of your organization’s budget, including operating expenses.
  • Providing flexibility for different organizations. Nonprofits of all sizes can fundraise through an online shopping program—along with schools, faith-based organizations, community groups, and even sports teams!
  • Increasing your fundraising capabilities as compared to AmazonSmile. Other online shopping fundraiser programs can get commission rates as high as 10% depending on the purchase, as compared to AmazonSmile’s 0.5% average rate.

Online shopping fundraiser programs also benefit supporters by allowing them to shop more ethically as they go about their daily lives. Plus, they can contribute to your nonprofit with little effort and at no additional cost.

Korri Piper, Sales and Marketing Consultant & Director of Vendor Relationships at ShopRaise – Bio

Relationship director, project manager, writer and general life enthusiast. Let me tell you how online shopping can solve the world’s problems.

Fundraising Tuesday: Annual Reports, the Long and Short of It

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What’s the right size for your nonprofit’s annual report?

In 2021, an organization with whom I have worked sent out a very brief annual report: two sides of a sheet of paper, including photos, quotable quotes, and pie charts showing their finances. They mailed it to all the postal addresses they had, and they attached it to email and sent it to the rest of their list.

In 2022, that same organization prepared what I think of as the traditional annual report: sixteen pages including a cover, a letter from the Executive Director, descriptions of all their programs and statistics about how many they served, and a list of donors by name and level.

Which approach was better?

SHC annual report coverAdvantages of a Short Annual Report

  • A two-page annual report is MUCH more likely to be read than a longer version.
  • It can be snappy and to the point.
  • The eye-catching elements (photos, captions, bold type) are a larger part of a short report than a long one. You avoid the wall of text that signals “no entry” to so many readers.
  • It’s cheaper to print and mail.

Don’t think, however, that it will take a lot less time to prepare a shorter report. Collecting and choosing the right stories, photos, and quotable quotes is a painstaking process.

(It’s like the opening line attributed to Mark Twain: “Dear ___, here is a long letter. I would have written a short letter, but I didn’t have the time.”)

You will also need to take time with the layout, to make sure you use a large enough font for your donors’ eyes and leave enough white space to make it readable and attractive AND say what you want to say.

Advantages of a Longer Annual Report

While few donors or funders will read a long report page by page, many will find it impressive. Having a lot to say, and saying it in a professional manner, will build trust that your organization is doing something worthwhile.

This is particularly true if you’re going to use your annual report to accompany phone, online, or in-person visits to donors or funders. You can either go over it with them or have a more personal conversation, not worrying that you’re leaving anything out: it’s in the report you’re leaving with them!

Some funders, and a lot of donors, may wonder why you’re spending their money on a glossy publication, or on mailing a multi-page document, instead of on program. You will want to know your particular audience and get a sense of how they’ll react.

In fact, the answer to “Which approach is better?” will always be, “It depends on who your audience is and how you will share the report with them.” Let’s talk about that in a future post.

Fundraising Tuesday: 3 Strategies to Build Strong Donor Relationships

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Strong donor relationships are the key to securing the longevity of your organization. With consistent donor support, you can push your mission forward and provide the important services that uplift your community day in and day out.

However, without a clear plan to build and develop donor relationships, you might experience donor lapses fairly frequently and struggle with retaining support over the long term. To help you navigate around this obstacle and increase your donor lifetime value, use these essential tips:

  • Send targeted messages
  • Express donor appreciation
  • Ask for donors’ feedback

With these best practices, you’ll be able to engage with donors at a high level, strengthen your fundraising strategy, and develop long-lasting relationships that will power your mission for years to come. Let’s begin.

Send targeted messages

Communications that are highly personalized and relevant to the recipient are more likely to inspire action. With the help of your email provider and CRM, you can group your contacts into segments based on similar characteristics, ensuring that the donation requests and updates your donors receive are pertinent to their involvement in your nonprofit.

According to Kwala’s guide to donor communications, you can create segments based on factors like:

  • Donation frequency, recency, and amount
  • Volunteer status
  • Event attendance
  • Demographics like age and location

For example, you can create a segment for major donor candidates so your donation solicitations are higher than your usual request for the average donor. You could also make a segment for lapsed donors to highlight major updates that have happened since they last gave or remind them of the impact of their contributions. This can help you boost your donor retention rate and kick-start strong donor relationships.

By using prospect research and tapping into your nonprofit’s CRM, you can create personalized messages and gain a better understanding of your audience. Donorly’s guide to prospect research recommends looking for capacity (wealth) and affinity (warmth) markers so you can better understand your current donors and prospects’ ability and willingness to give.

Express donor appreciation

Donor appreciation is one of the most effective ways to increase your donor retention rate. Being seen, heard and appreciated by your organization will result in more repeat donors and actively help you achieve your fundraising goals.

Try these donor recognition strategies:

  • Handwritten letter. Write your supporters a thank-you letter with a personalized greeting, a reference to their specific donation and how it helped advance your mission, and a personal statement of gratitude. If your staff is strapped for time, you can send handwritten letters to your major donors and digitize the rest of your letters using email.
  • Donor recognition wall. A donor recognition wall is a physical or virtual display that recognizes your top supporters. Create a threshold for how much a donor has to give to see their name added to your recognition wall.
  • Social media shout-out. Share engaging visuals that spotlight your donors. Not only does this help your donors feel appreciated, but it can market your donation program to new followers and motivate them to give so they can similarly receive a shout-out.
  • Donor gifts. Give your top donors a special gift like nonprofit merchandise or gift cards to local businesses. Ask your donors ahead of time what gift they might prefer.
  • Exclusive events. Host an exclusive event for leading supporters of your organization to show how much you value their contributions, such as a dinner, awards ceremony, or donor party. You could also host a separate event as part of a larger fundraising event. For instance, if you host a hybrid auction, you can invite major donors to an in-person gathering while hosting all of your other attendees virtually.

Regularly communicating your appreciation can lead to stronger relationships with supporters, ultimately helping your nonprofit meet its goals and elevate its impact in the community. Make sure to send your thanks within a week of receiving the donation so donors immediately feel recognized.

Ask for donors’ feedback

Donors want their voices to be heard, so giving them the opportunity to communicate with your organization can help you nurture their relationships. Create a survey that asks donors questions such as:

  • What inspires you to give to our organization?
  • How engaged are you in our organization’s efforts?
  • Do you feel appreciated for your contributions?
  • Do you have any suggestions on how our organization can improve?
  • What is your preferred communication method?
  • What events have you attended? What was your favorite event?
  • Do you have an interest in volunteering?

If your donors identify areas of improvement, make sure to consider this feedback and implement the necessary changes so you can retain their support. You’ll also want to focus on sending your communications via their preferred communication method.

For your major donors, you can have these conversations in person or virtually. After all, studies show that the top 20% of donors are responsible for 80% of your nonprofit’s revenue. By meeting with your major donors and giving them the opportunity to voice suggestions, they’ll feel like they’re truly a part of your organization’s community. Meet regularly with your major donors to discuss these talking points and let them know different ways they can increase their involvement based on their responses, such as by joining your volunteer program or taking a tour of a facility their donations helped build.

Once you’ve acquired a new donor, the work is just beginning. Donor retention is an ongoing effort and requires frequent communication and transparency so you can build a thriving giving community. Whether you want to boost your recurring giving program or encourage your top donors to stick around for the long run, these tips can help. Remember to remind your donors of their impact and how donating to your organization helps promote your cause. Good luck!

Sandra Davis prospect researchFounder and President Sandra Davis leads Donorly with 30 years of fundraising experience and leadership. Sandra has consulted on numerous capital campaigns, led strategic planning and feasibility study efforts, and managed board development and recruitment efforts in addition to overseeing planned giving, special events, and annual giving programs.

Under her leadership, Donorly has grown to support the fundraising efforts of over 75 clients to date.

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