Soapbox Engage Blog

According to CrowdCrux, in 2020, nonprofit crowdfunding and peer-to-peer fundraising campaigns raised an average of $9,237, and the average donation was $66.

Understanding the difference between crowdfunding and peer-to-peer fundraising campaigns can be confusing. There tends to be a lot of overlap and similarities, but they are not one and the same. Have no fear! We'll unpack it for you and help you understand which one is right for you.

Table of Contents

• Crowdfunding vs. peer-to-peer fundraising basics
• Crowdfunding multiplies donations from a large pool of donors
• Strategies for crowdfunding success
• Peer-to-peer fundraising expands your donor network
• Strategies for peer-to-peer fundraising success

Crowdfunding vs. Peer-to-Peer Fundraising Basics

A crowdfunding campaign can also be linked with a peer-to-peer fundraising campaign. Since crowdfunding campaigns rely heavily on your digital marketing infrastructure, they can be widely promoted through your organization's channels.

While individual supporters can share posts, crowdfunding campaigns are usually led by an organization's fundraising team and drive contributions through a single donation form.

On the other hand, peer-to-peer fundraising campaigns are driven by supporters and volunteers who eagerly help raise money on your behalf. Peer-to-peer campaigns use custom donation pages and forms for each supporter participating in the campaign.

So, a crowdfunding campaign uses one main donation page and platform but invites people to share that information with their networks. A Peer-to-peer fundraising campaign mobilizes supporters with their own donation page to raise money on your behalf. As mentioned before, some peer-to-peer campaigns also include a crowdfunding campaign.

Factors to consider when choosing between crowdfunding and peer-to-peer campaigns

Planning, setting goals, understanding how donor demographics affect participation, creating marketing content, developing communication plans, and evaluating fundraising platforms are equally crucial to crowdfunding and peer-to-peer fundraising campaigns.

However, the tactics required to run a successful peer-to-peer fundraising campaign can vary significantly compared to those needed for a successful crowdfunding campaign. To decide which approach is right for your organization, consider your goals for the campaign, your organization's resources, and the type of donors you want to reach.

We put together two campaign outlines to help you decide which type of fundraising campaign is right for your nonprofit and which one will help you reach your fundraising goals.

Crowdfunding Multiplies Donations from a Large Pool of Donors

According to the National Council of Nonprofits, crowdfunding is a valuable tool for nonprofits because it mobilizes a large audience to make financial contributions to the cause. It was first used by entrepreneurs to attract small individual investments in their companies or products.

Crowdfunding campaigns typically appeal to fundraising teams because of the low cost of entry. Although some organizations tie them to live events, many crowdfunding campaigns are fully digital. As with many fundraising strategies, it's essential to allow time to plan and have specific tactics in place to ensure the success of any crowdfunding campaign.

Strategies for crowdfunding success

Plan: Determine the roles of your fundraising team for this campaign, set up a calendar, and ensure communication throughout your organization to provide campaign updates regularly.

Set Goals: In addition to the amount of money you want to raise, get people behind your campaign with measurable non-financial goals. How many donors would you like to reach? How many first-time donations would you like to receive? Share your plan or description of how your nonprofit plans to use the funds. Don't forget to include a timeframe for your campaign.

Create suggested giving levels: Be sure to offer appropriate giving level suggestions for your ideal audience. When you set the right giving suggestions, donors tend to give more money rather than taking the time to type in a lower custom amount.

For example, if someone originally planned to give $20, but the lowest suggested donation amount is $25, many people will select $25 rather than scroll down and enter $20 into the "custom donation" field on your donation form.

Target Donors: CrowdCrux found that many nonprofit donors who contribute via crowdfunding also regularly attend charitable events and volunteer. Rally your current donors, volunteers, and supporters well in advance.

Determine who is willing to contribute "seed money." Psychologically, no one wants to be the first to give, so have donations in the pipeline before the campaign kicks off. Don't forget to consider how the demographics of your donors will impact participation and communication channels.

Prepare Marketing Content: Videos are a great way to tell your organization's story, provide credibility, and explain where donations go or what project they support. Videos can also provide engaging updates on the progress of the campaign.

It's also essential to determine what marketing content and resources you will need for emails, blog posts, social media, landing pages, and other content you want to distribute throughout the campaign. Though some of this content might need to be updated as the campaign goes on, you can create much of this content in advance and alleviate stress during the campaign.

Develop Communication Plans: Create a communication plan to fit the campaign's timeframe. Evaluate your communication channels. Have you packaged your campaign content for social media? Are your emails drafted? Are your target lists ready to go?

Select Your Fundraising Platform: Select a fundraising platform that streamlines the crowdfunding process and provides the right features and capabilities to meet your needs. The Soapbox Engage Donations app is fully customizable and ideal for crowdfunding campaigns.

Peer-to-Peer Fundraising Expands Your Donor Network

Recruiting individuals to fundraise on behalf of your organization generates a bigger donor pool because individuals ask members of their networks for donations. A peer-to-peer campaign accelerates fundraising activities and increases the visibility of your organization. It's a great option if one of your goals is to expand your network and increase "buy-in" from your current supporters.

Peer-to-peer fundraising campaigns have a relatively low financial cost. Still, it's important to consider the time cost to provide toolkits, resources, training, and support for people who are fundraising on your behalf.

In addition, peer-to-peer campaigns can include live events, such as 5Ks, "a-thons," competitions, or contests, which require more upfront costs and planning.

Strategies for peer-to-peer fundraising success

While many aspects of planning a peer-to-peer fundraising campaign are similar to crowdfunding, more specialized tactics are needed to implement the campaign and create a lasting impact on new donors.

Plan: Recruit loyal and active volunteers and donors who are well-acquainted with your organization's mission as well as the goals of the current fundraising campaign.

Think of which supporters you want to be an extension of your organization's fundraising team for this campaign. Make sure that they are passionate about your project and willing to reach out to their friends and family to ask them to support the campaign and represent your nonprofit well.

Set Goals: Measurable and time-bound financial goals are essential for any fundraiser. You may also want to consider setting non-financial goals such as the number of first-time donors the campaign reaches.

Giving tiers and gifts can be a great way to incentivize participation, motivate donors, and help you reach your campaign goals. Branded thank you gifts for different donation levels can be a great way to reward supporters and encourage people to give.

Target Donors: Engage with core fundraising team volunteers early and often to ensure they have all the support and tools needed for fundraising success. Many supporters are eager to fundraise on behalf of their favorite nonprofit but feel intimidated by the process. Offering the right training, tools, and encouragement can make a big difference and keep them coming back for more peer-to-peer campaigns in the future!

Prepare Marketing Content: Supporters will need easily customizable templates for social media posts, customized landing pages, and emails. Videos, graphics, or other materials created to enhance the campaign must be available to be easily shared. The Soapbox Engage Donations app lets you have unlimited custom donation pages, and your supporters will love how easy it is to set up and put their own unique touch on it!

Develop Communication Plans: Evaluate your communication channels. Is it easy for your volunteers to access and customize the content during the peer-to-peer fundraising campaign? Are they aware of the communications and campaign schedules?

Select Your Fundraising Platform: To streamline accepting online donations, make sure that your platform can quickly create an unlimited number of secure, custom donation landing pages and donation forms. Since each new donor creates more data, ensure that your CRM (customer relationship management) system seamlessly integrates with your online donation platform to reduce a lot of the paperwork and behind-the-scenes stress on your team.

Since most peer-to-peer fundraising campaigns rely heavily on social media interaction, make sure your online giving platform is mobile-friendly. Many people will engage with the campaign via their phone or tablet.

Both peer-to-peer and crowdfunding campaigns are very popular and effective fundraising strategies. Incorporating these strategies and tools will help ensure you choose the right type of fundraising campaign for your organization and help you reach your goals! Soapbox Engage apps easily adapt to accommodate crowdfunding and peer-to-peer fundraising.

Here are three more resources to get you started on your next crowdfunding or peer-to-peer fundraising campaign.

• Is Your Nonprofit Making These Common Crowdfunding Mistakes? Learn how to avoid the common pitfalls to produce a top-notch crowdfunding campaign for your organization. Read about best practices for planning, goal setting, communicating, seeding campaign funds, and suggesting giving levels.
• 5 Ways To Make Your Peer-to-Peer Fundraising Campaign More Successful: Peer-to-peer fundraising campaigns can bring in significant amounts of money and dramatically increase the number of people connected to your organization. Make sure that your CRM and fundraising platform help maximize your fundraising potential.
• PTA Peer-to-Peer Fundraising Pages: School PTAs can quickly create online peer-to-peer fundraising campaigns with Soapbox Exchange, making it easy for parents, family members, and other supporters to craft compelling, personalized fundraising pages.