The ALS Ice Bucket Challenge Offers Key Lessons for Nonprofit Fundraising Models

By Laurie Arena De Armond, CPA

On July 15, golfer Chris Kennedy was challenged to dump a bucket of ice over his head, post a video to social media and nominate three friends to do the same within a 24-hour period or donate to a charity of their choice. One of Kennedy’s nominees opted to donate to the ALS Association in addition to posting her own ice bucket challenge video. Separately,
on July 31, Peter Frates, former captain of Boston College’s baseball team who lives with ALS, posted his ice bucket challenge video to Facebook. These initial videos went viral on social media, rapidly transforming what began organically as a charitable challenge between friends into an online giving movement through which the ALS Association has gained unprecedented levels of awareness and donations.

As of Sept. 8, reported that the organization had received $111.1 million in Ice Bucket Challenge donations from individuals and corporations from all across the globe. Donations have ranged from $1 to $200,000, and 10 percent of visits to the organization’s site have resulted in donations.

The success of the Ice Bucket Challenge reinforces social media platforms’ ability to accelerate and drive fundraising campaigns. Of course, this online giving mega-success is exceedingly rare, and organizations cannot guarantee their campaigns go viral—indeed, the Ice Bucket Challenge was not even a campaign of ALSA’s own design.

Nevertheless, the model and features of the Ice Bucket Challenge may be valuable to other nonprofits as they seek ways to revamp their own fundraising strategies to reach a younger generation of potential donors. Part of the campaign’s appeal is its format: It’s authentic, fun, gamified and highly shareable, and it conveys a succinct and meaningful message.

Further, the campaign visibly demonstrates that average people can make a difference, not just through monetary donations but by using their own voice to promote awareness to their networks. Donors who see a clear connection between their contributions and overall outcomes—in this case, record-setting fundraising levels—are more inclined to spread the word, creating a multiplier effect through social media. While this effect has the primary impact of boosting donations, it also can help organizations resolve one of their biggest fundraising challenges: having to directly ask
the same audience for donations year after year. Social media allows donors to more easily become advocates.

Despite the resounding success of this campaign, we encourage organizations to remain cognizant of social media’s lack of predictability. As the Ice Bucket Challenge has proven, online charitable campaigns can quickly spiral into far-reaching movements through social platforms. Organizations can, as a result, lose control over their campaign’s
scope and how it’s shared online.

Similarly, nonprofits must also keep their financial responsibilities top of mind. As my colleague Sandra Feinsmith discusses in her article on page 5, the IRS has so far provided limited guidance on the tax implications of nonprofits’ social media use. Organizations must be proactive in their efforts to identify potential challenges and maintain compliance.

As nonprofits look to adjust their fundraising strategies for a new generation of donors, online giving campaigns offer significant opportunities for growth. Savvy organizations will look to lessons learned from the one-ofa- kind Ice Bucket Challenge to develop online community support to create sustained, long term advocacy and financial support for their

For more information contact a Templeton Advisor.

This article originally appeared in BDO USA, LLP’s “Nonprofit Standard” newsletter (Fall 2014). Copyright © 2014 BDO USA, LLP. All rights reserved.