c. 1998 Religion News Service
UNDATED _ In search of books, sweaters, toys, and a nearly infinite variety of whatevers, Americans are spending billions of dollars out there in the Internet universe. Online shoppers spent some $3.5 billion in the last quarter of 1998 alone.
With all that money surging around the electronic ether, a few do-gooders got the bright idea of carving off a slice for worthy charities. So now, a small number of venture capitalists, a few recent business school graduates and two idealistic young electricians have set up Web sites aimed at doing good. So far only a trickle of money has made its way through the sites to charities, but the idea is catching on.
Here’s how these shop-to-give ventures work: The online shopper visits the charity site, chooses a nonprofit organization to support and makes a purchase through one of the retailers linked to the site. At some of the sites a percentage of the purchase price, set by the retailer, goes to the designated charity. At others, part of the sales commission the retailer might normally pay to a site that sends shoppers its way goes to the charity. Or sometimes charities get money both ways.
A recent search turned up these five charity shopping Web sites:
No. 1 on the list of charities at Charitymall.com is America’s Promise, the national organization headed by retired Gen. Colin Powell aimed at mobilizing volunteers to help at-risk young people. Powell, who grew up in the Bronx, has long been a hero to Earl and Karl Thomas, brothers who launched the site in November. The brothers were raised in suburban New York but now live and work in the Bronx.
The brothers’ experience illustrates how easy it is to create a Web site and establish links with well-known retailers and prestigious charities. The two used their savings to set up the site and Karl, who went to Westchester Community College and was an apprentice electrician, was the designer. Most of the shop-to-give sites have eight or so employees. Charitymall.com is run by the two brothers alone.
Their experience also is typical of how things go on the Web _ the site became active before all the kinks had been worked out. The brothers are still working on the links to document for the vendor where the buyer came from, and, for the charity, from whom the contribution came. They won’t know till February how many transactions there have been and how much has gone to charity.
In contrast to other shop-to-give Web site operators, the Thomas brothers donate 100 percent of their referral fee to the designated charity. Their 22 affiliated retailers send the commission, which runs from 5 percent to 25 percent of the money the consumer spends, directly to the charity.
“We don’t even see any of the money, and get a lot of positive response because of that,” Karl said.
“Our friends say, `What’s wrong with you guys?’ The Internet professionals say, `Why not take 50 percent?’ When you say you’re giving it all away they look at you confused.”
The spokesman for America’s Promise, Jeff Wender, says of the Thomas brothers, “We love them. It’s a fantastic idea, and their enthusiasm is catching.”
The brothers hope that advertising will support the Web site, but not much has turned up so far.
What made it easy for Charitymall.com and the other sites to open up with impressive lists of big name vendors like J. Crew or Music Blvd or Avon or Amazon.com, is that the infrastructure has been set up so anyone with a Web page can sign up with retailers to participate in a referral program. The charity Web site creator simply goes to a retailer’s site and fills out a form linking their small Web to the retailer’s big one. The shop-to-give Web sites get a commission on each transaction.
The charities, for the most part, were also eager to lend their names. Three of the sites provide short, but growing, lists of charities that have given permission for their names to be used.
Two of the sites, Shop2Give.com and iGive.com, let you pick your own charity, no matter how small or obscure. Shop2Give.com requires that your charity be a tax-exempt organization officially registered with the Internal Revenue Service. At iGive.com, venture capitalist and chief executive Robert Grosshandler says you could give to your brother Bob if you wanted, but not to an organization that advocates violence or breaking the law, or is involved in electoral politics.
These five sites join a crowd of 3 million Web sites out there, according to Network Solutions, a research firm tracking applications. Eighty-five percent of Web sites are commercial; 10 percent are nonprofits. In these enterprises .com, for commercial, meets .org., for nonprofit. Though they see themselves as charitable in intent, all in the .com category do intend to make a profit. Except for Earl and Karl Thomas, who would like to make just enough to keep the site going.
With 654,000 tax-exempt charities in the United States, there is no shortage of causes looking for money. The smaller charities, without big budgets for fund raising, are especially enthusiastic about getting their names up in computer lights at no cost to them, even if it’s on someone else’s site.
One of the biggest nonprofits is markedly unenthusiastic, though. The American Cancer Society was approached by several of the charity shopping Web sites and chose not to participate.
The society’s communications director, Joann Schellenbach, said, “We have a very sophisticated fund-raising department, which chooses where to put its resources.” She added that the group is leery of the Internet in general; they’ve been burned by bogus Internet chain letters and scams using the American Cancer Society name without permission.
Another giant charity, the American Red Cross, however, signed up with Los Angeles-based Shop2Give.com as soon as that site opened Dec. 1, in order to get money for Hurricane Mitch relief. There’s no way to see yet how much was raised, said site creator Ami Kassar, since most retailers record transactions quarterly.
These enterprises are very young. All of them except iGive.com, a venerable one-year-old, sprang up this fall in time to catch a wave of Christmas shoppers.
Only iGive.com has sent a chunk to charity so far. Grosshandler said that 40,000 members supported 4,500 causes with a total of $180,000 given over the last year.
Though the shop-to-give sites are at an awkward early stage, and no charity reports a big pay-off, the Web site entrepreneurs all describe the set-up as “a win-win-win situation.” The shopper-donors lose nothing; they just buy what they were going to anyway. The donation comes at no cost to the charities and the vendors attract customers they probably might not get otherwise.
Neutral observers in the charity world, like Todd Cohen of Philanthropy Journal, say anything that makes it easier for charities and would-be donors to find each other is a good thing.
DEA END CASEY