Nonprofit Website Effectiveness: The Role of Donor Relationships
Adrian Sargeant and Elaine Jay
December 2003
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Introduction
At the end of 2002 there were an estimated 186 million Europeans online, 183 million in the USA and Canada, and 168 million in the Asia/Pacific region. Over 40% of this online population is English-speaking. Despite the potential value of this market, the UK nonprofit sector has been fairly slow to capitalise on the new technology (Saxton and Game 2002). The charity press in the late 1990s hyped the possibilities of ‘e-philanthropy’, which, it was predicted, would attract and retain a whole new generation of online supporters and would radically change the way that nonprofits undertake fundraising and communication. It is now accepted that this online revolution in giving has so far failed to materialise.
However, examples of good and creative practice abound and the Internet is now being used effectively in fundraising by a number of charities. Despite some anecdotal success stories, hard information about the performance of online fundraising is scant. Data from a 2002 study showed that US donors contributed more than $96 million over the Internet in 2001, but this was limited to 126 of the largest American charities. No equivalent data is gathered in the UK and in neither country has it proved possible to genuinely benchmark web fundraising performance or to determine the characteristics of the sites that tend to raise higher sums. Our research project was designed to address both these dimensions and to determine both the typical performance of fundraising websites and relate this to facets of site content using a variety of different assessment criteria. We begin, however with a brief review of the factors likely to drive website performance.
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Website Performance and Features of Site
A number of studies have been conducted exploring the relationship between facets of site design and the performance of the site as measured by surrogate variables such as ‘attitude towards the site’. Site characteristics such as informativeness, organization, transaction-related interactivity and personalization all appear to drive user perceptions of site performance. Of these the concept of interactivity has received the most attention, having been highlighted as the key to commercial success in a number of studies.
Other writers have focused on issues such as service quality, learning capability and ‘playfulness’. A number of studies have developed ways to assess e-service quality and have demonstrated its impact on attitudes toward the site. Learning capability refers to the extent to which a site both educates and learns from the user and is critical in the development of ongoing customer relationships. In respect of ‘playfulness’ research has demonstrated that the likelihood of a repeat visit to a site is partly a function of the extent to which it offers a degree of play or entertainment.
Finally, a number of authors have addressed the issue of organization. Effective sites appear to share the common characteristic that they are easy to navigate a characteristic frequently not associated with the sites developed by nonprofits!
In presenting these findings, however, it is necessary to sound a word of caution. The difficulties associated with gaining access to actual performance data have led many researchers to employ the variable ‘attitude towards the site’ to
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measure site performance. Few studies have actually linked attitudes to various facets of Internet sites with actual performance data.
Relational Content and Website Performance
In the commercial sector authors have long argued that the key to success in Internet marketing lies in the building of customer relationships. This view is also put forward by Peppers and Rogers who maintain that successful nonprofit sites ‘customize, identify, differentiate and interact’ - with success being a function of the degree of ‘one-to-one’ relationship engendered.
Various authors have tested ways to measure and assess the relational aspects of direct marketing communications. A review of this work led us to identify the following as the eight facets of Internet sites that appear most likely to relate to the building of relationships.
1) Accessibility 2) Accountability 3) Case For Support 4) Education 5) Interaction 6) Respect 7) Customization 8) Empowerment
In addition to these factors we also decided to assess entertainment, informativeness and organization (found to be determinants of attitude towards the site by a number of authors) and ease of use, aesthetic design, processing speed and security (aspects of site quality identified by other researchers).
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Having assessed the sites against these measures, we went on to explore whether these dimensions are related to key components of website performance such as the number of new donors recruited, the average gift and total online donations received.
Methodology
Our research was conducted in two distinct stages. In the first we captured data on the performance of a wide range of charity websites.
In Stage 2 an online donation of £10 was made to each participating organization. Copies of communications received at that time and in the two months subsequent to offering the donation were collated. A team of eight assessors with considerable experience of Internet marketing practice was invited to evaluate each participating organization’s website and the postdonation communications received. We went on to analyse any relationships that might exist between the constructs we had assessed and aspects of actual website performance (gathered in stage 1).
Results - Stage 1
To gather performance data a postal questionnaire was developed and despatched to 120 registered charities listed in the Charities Aid Foundation’s Top 500 Fundraising Charities and known to be engaged in fundraising over the Internet. In total 61 replies were received. The response rate was thus 50.8%
The questionnaire began by gathering information on the longevity of the Internet presence of each organization. The mean year that sites had originally been
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created was found to be 1998 although many sites had been relaunched at least once since their initial conception. Where relaunches had taken place these were comparatively recent with the mean being 2002.
Table 1 provides a summary of the purposes for which these sites had originally been designed. Respondents were asked to indicate how important each dimension of Table 1 was to them in designing their site employing a 7 point scale where 1 = very unimportant and 7 = very important
Table 1: Original Purpose of Website
Site Purposes Provide information about your organization Increase awareness of your organization Facilitate access to your programmes and services Recruit new supporters Raise funds Gather information about supporters Encourage advocacy Engage in a dialogue with supporters
Mean 6.57 6.34 4.66 5.21 5.14 3.02 3.09 3.44
Median 7.00 7.00 5.00 6.00 6.00 3.00 3.00 4.00
The results indicate that information provision, enhancing awareness, attracting new supporters and raising funds were regarded as the most significant purposes of the site. Issues such as advocacy and engaging in a dialogue with supporters were generally considered unimportant.
Data on the financial performance of the websites is presented in Table 2. As expected the results indicate a wide spectrum of performance. Distributions
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pertaining to costs and revenues were often highly skewed with, as a consequence, median values being more indicative of the ‘typical’ performance achieved across the sector. It seems clear that the Internet is as yet the source of little revenue for the sector with only 18 new donors being recruited through a typical charity site, offering an average donation of only £26.
It is important to recognize, in interpreting the results in Table 2, that the costs of development and maintenance for the site as a whole may not be related directly to site revenue. As Table 1 has already highlighted many sites are designed for multiple purposes such as information provision and awareness. Many of the costs alluded to in Table 2 are thus programme and not fundraising costs and isolating the latter is problematic. Whilst the figures suggest that few sites are as yet breaking-even on their web presence, in many cases (given programme related goals) this may be neither desirable nor achievable.
What does seem clear, however, is that whilst a small number of charities (such as Comic Relief) are clearly deriving very large sums of income from web-based fundraising the norm is a pattern of performance well below this. Few organizations attract more than a handful of donations over the Internet.
It is interesting to compare the results in respect of revenue for the past financial year reported in Table 2 with those projected for the current and subsequent financial year reported in Table 3. It would appear that respondents remain optimistic in respect of their future performance and anticipate rapid growth.
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Table 2: Financial Performance of Charity Websites
Variable Cost of Development (Current Version of site) Total Online Donations (Past Year) Total Donated Via Form Printed From Site (Past Year) Total Donated – Donor Calling in Response To Site (Past Year) Maintenance Costs (Past Year) Average Donation (Past Year) Number of New Donors (Past Year)
Mean £22,933.61
Std Dev £46,217.17
Median
Maximum
£4,500.00 £200,000.00
£129,422.10 £632,238.90 £1,642.00 £4,000,000.00
£3,787.13
£10,036.92
£25.00
£50,000.00
£389.65
£1,311.31
£0.00
£5,200.00
£19,133.21
£46,555.97
£2,634.00 £250,000.00
£49.73
£48.79
£26.00
£184.00
527.33
1,342.27
18.00
6,000.00
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Table 3: Predicted Revenue Levels From Internet Fundraising.
Variable Expect to raise this year Expect to raise next year
Mean £84,493.06
Std Dev
Median
Maximum
£336,893.00 £3,000.00 £2,000,000.00
£183,092.00 £721,281.10 £7,000.00 £4,000,000.00
When asked whether their present fundraising performance had been at the level anticipated it is cleat that for the majority of respondents this had proved to be the case. Table 4 provides the detail of this analysis and indicates in addition that few charities had achieved results that were either significantly higher or significantly lower than expected.
Table 4: Perception of Performance
Performance Significantly higher than expected Higher than expected At the level expected Lower than expected Significantly lower than expected
% Indicating 7.1
16.7 50.0 21.4 4.8
The categories of fundraising activity that appeared to be the most effective in attracting online support are illustrated in Table 5. Respondents were asked to indicate all those they had found to be effective, hence the column does not sum www.charityfundraising.org 9
to 100%. It seems clear that supporter appeals, committed giving and the marketing of events have been found to be the most effective online fundraising approaches.
Table 5: Effective Website Campaigns
Campaign Membership Trading Committed Giving Attendance at events Sponsorship Supporter Appeals Capital Appeals Raffles
% Indicating 13.2 26.3 31.6 39.5
23.7 47.4 5.3 18.4
Respondents were then asked to identify the media they currently employed to develop donors recruited through their site. The detail of this analysis is reported in Table 6. Clearly direct mail remains the preferred development route for many UK charities.
Table 6: Media Employed For Development
Communication % Indicating Direct Mail Telephone E-Mail Text Messaging 88.1 45.2 54.8 2.4
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Results - Stage 2
In Stage 2 of the project a team of 8 assessors evaluated each participating organization’s website. In total 54 websites were appraised as it proved impossible to donate to 7 organizations in the sample. A number of websites had failed whilst in others the links to the agency collecting online donations failed to function. This is particularly noteworthy as attempts were made to make a donation over a ten-day period. In one case, it also proved impossible to notify the charity concerned that their giving mechanism had failed since the e-mail address quoted on the website was found to be out of date and the telephone operator was unsure as to whose responsibility the website now was.
In each case a donation of £10 was offered to the nonprofit and the communications received over a period of two months post-donation were monitored. The assessors were thereby able to appraise both the site and the quality of communications received after an online donation had been made. It should be noted that in 10 cases no subsequent communications were received from participating charities, although it subsequently proved possible to ascribe one such non-response to a data entry/transfer issue. Whilst every charity generated an automated ‘thank-you’ (many from the agency collecting the donation) not all were corresponding with donors thereafter.
In conducting the assessments the assessors were required to answer a battery of questions designed to provide feedback against each of the main relational constructs we had chosen to examine (Accessibility, Accountability, Case for Support, Education, Interaction, Respect, Customization and Empowerment). Five point scales where 1 = strongly disagree and 5 = strongly agree were assigned to the items designed to measure each construct. Tables 7 and 8 report the mean and median scores obtained for each item.
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Table 7: Relational Constructs
Statement Education The site provides good information about the cause You can learn a lot about the cause from the site The site answers my questions about the work that the charity does The site provides a very good learning experience The site credits me with intelligence It would be easy to explain the work of the charity to someone else Accountability The site provides a clear security statement I am confident that transactions using the site are secure The site makes it clear how my personal data will be used Any personal data I provide will be used appropriately The site is open about the financial performance of the charity Case For Support The charity appears to need my support When I gave to this charity I felt good about it The communications I received when I first gave a donation were good The charity shows me they appreciate my gift Accessibility The site offers different ways to give support It was easy to make a donation Making a donation was a fast process The response to my donation was appropriate
Mean
Median
Std Dev
4.13 3.94 3.96 3.62 3.71 3.87
4.22 4.00 4.00 3.60 3.71 4.00
0.58 0.69 0.76 0.92 0.76 0.76
2.67 3.05 2.34 2.54 3.21
2.75 3.22 2.22 2.50 3.22
.77 .75 .82 .79 .93
3.75 3.35 2.74 2.68
4.00 2.50 3.70 2.55
.68 .78 1.06 1.20
3.78 3.92 3.84 2.92
4.00 4.00 4.00 2.77
.94 .82 .83 1.06
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Table 8: Relational Constructs
Statement Interaction The site is easy to navigate The site offers a two-way dialogue The site has a developed community The site includes links to related organizations The site offers ways to help other than by giving cash donations Customization It was easy to tailor the site to suit my own needs The organization have offered me several ways to keep in touch It was easy to tailor the content of the site Empowerment The site sanctions me in taking action The site makes me feel that I can make a difference The site made me feel I have some authority
Mean
Median
Std Dev .62 .80 .80 1.03 1.04
3.92 2.73 2.81 3.08 3.63
4.00 2.50 2.71 3.00 4.00
2.55 3.33 2.46
2.50 3.50 2.45
.73 .77 .67
3,23 3.40 3.10
3.22 3.60 3.10 3.45 3.50
.68 .84 .71 .83 .94
The site provides me with ideas for possible actions 3.29 The site provides me with ways in which I can take action Respect The communications I have received from the organization have been appropriate I liked the way the organization thanked me for my donation The communications I have received from the charity show that they value me 3.37
2.74 2.72 2.71
2.60 2.36 2.55
1.14 1.25 1.19
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The assessors were then asked to answer questions designed to probe the other factors that previous research had shown were key in explaining attitude towards a site: entertainment, informativeness and organization). The result of this appraisal (conducted on 5 point scales where 1 = not at all applies and 5 = very much applies) is reported in Table 9.
Table 9: Content Dimensions
Statement Entertainment Exciting Entertaining Cool Imaginative Flashy Fun Informativeness Informative Knowledgeable Helpful Resourceful Useful Intelligent Organization Messy Cumbersome Confusing Irritating
Mean
Median
Std Dev
2.23 2.35 2.07 2.49 2.28 2.19
2.12 2.31 2.10 2.40 2.35 2.00
.66 .71 .69 .77 .70 .78
3.74 3.76 3.68 3.58 3.73 3.49
3.90 4.00 3.90 3.90 3.50 3.55
.78 .70 .79 .77 .74 .81
2.01 1.85 1.88 1.88
1.77 1.63 1.71 1.71
.87 .72 .80 .87
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Finally the reviewers were asked to answer questions related to aspects of site quality (aesthetic design, processing speed and security). The results of this analysis are reported in Table 10
Table 10: Site Quality Appraisal
Facet Ease of Use This site is convenient to use It is easy to search for information Aesthetic Design The site is colourful The site is creative The site shows good pictures Processing Speed It is easy to access the results The site has quick process Security The site ensures me of security I am confident of security with this site
Mean
Median
Std Dev
3.59 3.53
3.75 3.75
.71 .75
3.77 3.33 3.57
3.77 3.75 3.55
.72 .76 .79
3.57 3.64
3.60 3.67
.57 .52
2.83 2.92
2.87 3.00
.82 .79
The performance figures for each site were then analysed and correlated against each of the constructs included in the study. The results for the relational constructs are reported in Table 11, those for attitude towards the site and site quality in Table 12.
It seems clear from the results in Table 11 that ‘accessibility’ and ‘accountability’ are significantly correlated with both the number of new donors attracted to a site and the amount of online donations attracted in the past financial year. Only the
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dimension ‘case for support’ appears not to be associated with site performance. It would thus appear that the strength of the appeal is less of an issue in the Internet context than it is in the realm of television/press advertising and direct mail. One explanation for this finding might be that those individuals visiting a site are (unless they have arrived there in error) already interested in the subject matter. There may thus less need to overcome the barrier of disinterest with a strong appeal.
Table 11: Correlation Between Relational Constructs and Site Performance
Construct
Accessibility Case for Support Accountability Education Interaction Respect Customization Empowerment
Online Donations In Past Year (£s) .30* -.07 .36* .29* .01 -.22 -.10 .27
Post In Form (£s Raised) -.20 -.17 .01 .03 .24 -01 .25 .12
Average Donation (£s) .12 .08 .27 .16 .13 .25 .17 .30*
Number of New Donors .32* .08 .45** .61** .33* -.02 .15 .58**
* = significant at the 0.05 level ** = significant at the 0.01 level Table 11 also makes it clear that the constructs ‘education’ and ‘interaction’ are significantly correlated with the number of new donors a given site has been able to attract. Indeed, the former of these is also significantly correlated with the amount of online donations attracted in the past financial year. ‘Empowerment’ is associated with both higher average donations and higher numbers of new donors being attracted to the site. Respect and customization appear unrelated to performance.
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The sums of money raised from a form that may be printed out from a site and then mailed in appear unrelated to any of the relational constructs. It may be that these facets of a site are less important in stimulating donations of this type, or it may be that other criteria such as user demographics would offer more utility in explaining behaviour in this case. It is also interesting that only one construct was significantly correlated with average donation. Again, this may occur since the amounts an individual may be willing to give may be rather more a function of their demographics (particularly age and income) than it is of the perception of the site per se.
Table 12 presents the results of the analysis for both attitude towards the site and site quality. Here again a similar pattern emerges with none of the constructs tested exhibiting significant correlations with either average donation, or the income generated from a post-in form. Both sets of constructs are highly correlated with the number of new donors attracted. Only organization and security are highly correlated with the level of online donations attracted in the past financial year.
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Table 12: Correlation Between Attitude Towards the Site and Site Quality Constructs and Performance
Construct
Online Donations In Past Year (£s)
Post In Form (£s Raised)
Average Donation (£s)
Number of New Donors
Attitude Toward the Site Entertainment .25 Informativeness Organization Site Quality Ease of Use .09 .24 .44**
.29 -.05 -.08
.27 .18 -.07
.51** .52** .62**
.11 .17 -.05 .06
.07 .23 .25 .06
.44** .40** .30* .31*
Aesthetic Design .27 Processing Speed Security -.01 .35*
* = significant at the 0.05 level ** = significant at the 0.01 level
Discussion
It seems clear that there is as yet little sign of an e-philanthropy revolution in the U.K. Though a handful of charities have successfully developed their web-based fundraising into a significant income stream, and others are beginning to utilize the Internet creatively to develop relationships with their donors, in most cases a presence on the web is still a cost to UK charities.
However, many charity websites are not primarily designed as fundraising vehicles, but are there to provide information, to raise awareness and to
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encourage action. Online donation programs (often provided by third parties) are still in relatively early stages of development. Fundraising on the web may well advance markedly in the next few years, and our results show that fundraisers remain positive about the future of fundraising on the Internet.
Having reviewed the existing research, we identified eight constructs that could be employed in assessing how well charity websites perform in engendering a sense of ‘relationship’ with site visitors. Of these eight constructs our panel found that only the dimensions ‘education’ and ‘accessibility’ were well developed in the sites that comprised our sample. This is particularly relevant given that these were amongst the five constructs that were found to be linked to the number of new donors a given site had proved able to attract. Only ‘customisation’, ‘respect’ and ‘case for support’ appear unrelated to this aspect of performance. As we indicate above it is possible that since individuals electing to visit a site must by definition be interested in it’s content, it may not be as necessary in the web context to develop strong generic online appeals. Individuals may already understand and appreciate the case for support. The lack of significance pertaining to ‘respect’ is perhaps unsurprising as this may only be demonstrated once a relationship has been established at the post recruitment stage. It is interesting to note that customisation appears not to be correlated with any performance dimension, but given that the lowest evaluation means were recorded against this construct it seems likely that this occurs simply because few charities are as yet offering a customisation facility to individuals visiting their sites. It is possible that as this facet of site design is developed that the significance of this dimension may similarly develop over time.
A key finding from our results is that the relational constructs we highlight appear to be highly correlated (in the main) with performance as measured by the number of new donors recruited. They appear less well correlated with total online donations - only the dimension of ‘empowerment’ appears related to average donation. Thus whilst site design may impact on the attraction of new
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donors it appears to offer less utility in stimulating donations of a specific size. This may occur since the amounts an individual may be willing to give may be rather more a function of their demographics (particularly age and income) than it is of the perception of the site per se. It may also occur because few charities prompt donors to offer specific sums. Only three of the organizations in our sample prompted the donor to consider leaving specific sums, a practice which has long been commonplace in charity direct mail. Sites that lead donors towards gifts that are appropriate for their income and the impact they would wish to see on the cause may very well be more effective, but the characteristics of our sample make it impossible to speculate further.
The research also assessed the sample of UK charity sites against additional constructs that had proved key measures in previous research on what influences attitudes towards websites, and in measuring site quality. All of these constructs correlated with the number of new donors recruited through the site, with ‘entertainment’, ‘informativeness’, ‘organization’, ‘ease of use’ and ‘aesthetic design’ proving highly correlated to the number of new donors attracted. Only ‘organization’ (i.e. how well organized the site is and how easy it is to navigate) proved highly correlated to the level of online giving, with ‘security’ also correlated at a lower level. It is interesting that, even in the charity sector, entertainment (in its widest sense) and attractive design are key features of successful and popular sites.
In some cases, as noted above, online donations could not be made despite the site offering such a facility. Charities would be well advised to test their online giving mechanisms regularly – and to do so by actually giving a donation as many of the problems we encountered came at the very end of the process. Though the use of online giving intermediaries such as CAF and Worldpay is a welcome addition to many charity sites, it would be beneficial in many cases for the charity to work more closely with the intermediary to improve the postdonation bounceback communications that are sent. In many cases our
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assessors found these were impersonal and not sufficiently tailored to the specific charity, and in some cases ‘shopping’ terminology was used in the online giving process, which was viewed by our panel as totally inappropriate.
In some cases the automatically generated response from the online giving partner was the only communication received for over two months. This could indicate problems with the integration of data on new online givers with the main donor database. These will obviously need to be overcome if these online givers are to be retained and developed successfully. The lack of subsequent communication may also indicate problems with data entry and/or onward transmission. In at least one case of which the authors are aware a charity had recorded a preference for no future communication, despite the fact that the researcher believed that communications had been requested. Given the potential for human error, it may be appropriate for charities to consider employing a pop-up box which reminds donors opting out that the charity will not then be in a position to contact them again with news/information or feedback in respect of how their gift has been used. This would reduce the potential for misunderstandings to arise.
Charities may also wish to consider moving away from direct mail as the primary development mechanism for donors giving online. Whilst the issue of SPAM and frequent changes in e-mail addresses remain a problem, online donors are known to prefer e-mail as a means of communication. Employing this additional channel may well be the key to maximizing support from these individuals over time.
Finally, our assessors offered a number of general observations on the sites they evaluated. Notable here is the fact that only two sites highlighted the efficiency of their organization on a page of their site. Despite the fact that extant research has consistently shown that donors are interested in the percentage of funds donated that are allocated to the cause, such figures tended either not to appear
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at all, or to be included in an annual report which could be separately downloaded. Only a fraction of sites surveyed featured this information prominently.
There was similarly poor performance in providing information in respect of what had been achieved with past donations. Approximately half of the sample sites were felt to have handled this well, whilst in the balance the assessors had to infer the success in work undertaken from other data provided on the site. This may arise in part because fundraisers have little direct involvement in the design of an overall site and thus many of the lessons learned in the ‘traditional’ fundraising context fail to be applied to the Internet environment.
Our assessors also felt that the nonprofit sites provided comparatively little guidance in respect of privacy and security. Whilst the agency sites collecting donations offered this data, the charities themselves did not explain how personal data might be used. This is now common practice on commercial sites where statements in respect of privacy now receive considerable prominence. Research has consistently shown that shoppers online remain wary of offering personal data and that the absence of a clear privacy statement can be a common reason for abandonment of a shopping CART. Nonprofits are therefore advised to consider developing a privacy statement and featuring access to this on each page of their site, perhaps on the menu at the bottom of each page.
In interpreting our results it is important to note that we would characterise our work as exploratory and that as a consequence a number of caveats must be expressed. Our results are limited to the larger UK charities. We did not appraise the websites of smaller organizations. Our choice of performance variables was also somewhat limited. In assessing the relational components of a website one would intuitively expect that a link may exist between these facets of a site and performance variables such as donor lifetime value and donor attrition/retention rates. Certainly these would be key variables to employ were our study to have
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been conducted in the for-profit context. In the nonprofit context, however, 85% of donors recruited by a given site are then subsequently developed through the medium of direct mail. The relational content of sites will therefore have little impact, in the majority of cases, on subsequent donor behaviour. It was therefore impossible to include these additional performance variables in our current study. As the sector develops its use of the Internet and moves towards electronic donor development communications, it may eventually become possible to explore these relationships
References Peppers D and Rogers M (1997) ‘How Charities Can Profit on the Web’, Peppers and Rogers Group, New York Saxton J and Game S (2002), Virtual Promise, The Future Foundation, London
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