There’s a term you’ve probably heard recently floating around the online fundraising space, and it may have you curious. We’re talking about pledge now, pay later fundraising. At first glance, you might find yourself skeptical. Why would I want to give my donors the ability to pay me later instead of right now? Won’t I lose out on funds if they decide not to follow through? How does this help my cause?
These are all great questions, but the actual data may surprise you. There are some truly exciting things coming down the pipeline for digital fundraising and a lot of them feature the Pledge Now, Pay Later model.
That’s why CauseVox is rolling out a new Pledge Now, Pay Later feature and we put together this guide to help you understand how to use the feature to revolutionize your fundraising. We’re talking larger gifts, higher donor revenue over time, and easy back end management. Intrigued? Let’s check it out.
What Is Pledge Now, Pay Later?
Pledge Now, Pay Later (aka PNPL) is the state-of-the-art model that allows donors to select or enter in a dollar amount, and commit to completing the gift through several monthly or annual installed payments.
What Are The Benefits Of Pledge Now, Pay Later?
In recent years, pledges have fallen out of favor in nonprofit fundraising. You might still be living in an outdated mindset that says pledges are not what donors want, that they’re too much of a hassle, or that there’s no reason to use them.
But we have four major benefits to pledge now, pay later that will make you reconsider. Here’s why pledge now pay later is a great option:
1. Pledge Now, Pay Later means bigger gifts more often
One of the things that donors have told us over and over again is that they want to give, but just like any of us they want to do it responsibly, in a way that matches their budget. Pledges allow a donor to anticipate when they’re going to make a donation and split up large gifts into smaller installations so that it’s easier to budget. That all sounds great for the donor, but what about the organization?
Well, there are actually big benefits for you too. Because your donor feels comfortable and can give in a sustainable way, pledge now pay later ends up increasing the value of your donor over their lifetime: they make larger gifts and they make gifts more often.
According to the survey, 63% of people would give higher amounts and give more often if they could pay in installments.
When we asked donors who have used buy now, pay later options like Afterpay or Klarna – their response was even higher. 83% reported they would give more and more often if they could give in installments through a pledge now, pay later feature.
Oh, and here’s a statistic you’ll want to pay attention to: respondents with an annual income over $100,000 were 6 percentage points higher than average in saying they would give more if they could use pledge now, pay later. That means your high donors are going to give even more. Those are some pretty big payoffs.
2. Donors Prefer Installed Payments
When we asked active donors about their preferences, 83% of people who had used buy now, pay later to make a purchase said that they would prefer donating this way, since they can pay over time. With the vast majority of donors looking for a PNPL option, it’s safe to say you’re setting yourself up for success should you make it available on your donation form.
One respondent said it’s simply “faster and better,” while another called it “easy and convenient.” That’s basically what any nonprofit wants to hear about their giving process. As a fundraiser, you always want to be meeting your donors where they are, and pledge now, pay later lets you do that in a way that’s flexible and easy for you and your donors.
3. You’ll Get More Donors
The number of people who are using buy now, pay later options for their purchases grew 48% in the last year. We almost never see growth rates that high, which is an indication that the pledge now, pay later market is about to explode. If you get started as an early adopter, you’ll have access to all the donors who want this feature while other nonprofits are lagging behind.
Even more important is that the demographics most likely to use buy now, pay later are consumers between the ages of 22 and 44: we’re talking millennials. If you want to reach younger donors who approach giving in a completely different way, PNPL is the way to go.
Here’s more about how you can get more donation pledges for your nonprofit.
4. It’s More Flexible
Everyone likes flexibility right? If I’m going to make a major gift, I want to be able to do it in a way that makes sense for me and in my own time. Pledges allow your donors more control over how + how often they give.
Let’s say you ask a donor to give $1000. Not many people are likely to say yes: that’s an intimidating amount. But what if you ask for $80 a month for a year instead? You end up bringing in the same revenue, but it feels much more approachable to a donor and allows them to give the way they prefer.
5. You Get Predictable Revenue
Not only does the data show that you’ll end up raising more with pledge now, pay later, the model itself helps you lends itself to developing sustainable fundraising growth.
No more crossing your fingers and hoping for the best at your next fundraising event. You’ll be able to see what’s been committed and work towards reaching gaps in your budget.
With PNPL there’s more predictable, sustainable fundraising revenue coming in month-over-month or year-over-year, helping you properly lay the foundation for fundraising growth for years to come.
Still not sure about pledge now, pay later? One of our favorite things here at CauseVox is data, so when we started to see an uptick in the discussions of pledge now, pay later features, we decided to investigate for ourselves. Earlier this August we launched The 2021 CauseVox Pledge Now, Pay Later Study, which surveyed 400 North America-based individuals to explore donor behavior and preferences. We found a lot of juicy tidbits, but if you’re curious about our latest feature, here are the statistics you most want to know:
- 63% of survey respondents would give higher amounts and give more often if they could pay in installments.
- Active donors mentioned that installment payments are “easy and convenient” as well as “address cash flow issues”.
- 46% of active donors have used a buy now, pay later service (ex. Affirm or Afterpay) recently.
Taken together, this data shows that donors are using buy now, pay later services and that they love the convenience it provides them. They’re interested in seeing it within the charitable giving space, and if you give them the option, they’ll respond with more and larger donations.
How You Can Use Pledge Now, Pay Later
The CauseVox way is to help you raise more money with less effort while making the giving experience seamless and straightforward for your donors. After pulling together all this data in favor of pledge now, pay later, we decided the only thing standing in the way of our fundraisers was fear of managing pledges. Who wants to track everyone who said they’d give and manage following up to actually get the donation? Pretty much no one.
But it doesn’t have to be that way. CauseVox has launched Pledge Now, Pay Later: a state-of-the-art digital pledge form that’s designed to help you get more pledges online, automatically fulfill them, and make today’s donors happy. And no, you don’t have to do any extra work.
Here’s how it works:
- You can set up a donation page as usual, but include pledge tiers. Your donors can select a pledge tier or enter in their own custom pledge amount
- The donor decides how often they’re going to make payments and how many payments they plan to make. They can choose monthly or annually.
- The first installment will be billed immediately, and future installments based on the customized schedule your donor selected. You don’t have to do anything to make the billing happen.
- Your donors will get an automatic email upon completing each installment with an update towards their total pledge and a secure link to manage their payments.
You can even include donations and pledges on the same form, to give your donors the option to choose what works best for their life. They get choices and you get higher revenue. Win/win.
Get Started With Pledge Now, Pay Later + Revolutionize Your Fundraising
CauseVox is here to support you with all the latest innovations in online fundraising, including pledge now, pay later. CauseVox Pledge Now, Pay Later allows you to eliminate time spent on chasing down donors so you can spend more time on securing large gifts.
Download the 2021 Pledge Now, Pay Later stud y and sign up for the Pledge Now, Pay Later waitlist to get all our updates about Pledge Now, Pay Later.