When golfer Chris Kennedy was challenged on Facebook to pour ice over his head and make a donation to charity, he unwittingly became the architect of the ALS Ice Bucket Challenge.
Kennedy, from Sarasota in Florida, donated to the ALS Association because a relative was suffering from the Amyotrophic Lateral Sclerosis disease.
It was after he nominated the wife of that relative, though, when things took off. She completed the challenge, tagged a bunch of friends asking them to pour ice on themselves and donate to ALS. Soon, people around the world began flipping ice-filled buckets over themselves. In one month, the ALS Association took in US$15.6 million in donations, a massive increase over the $1.8 million it received during same time a year earlier.
As fun as it was for people to film themselves standing in freezing water and ice, the Ice Bucket Challenge marked a profound shift in charitable gift giving. If it weren't for technology and social media, the ALS Association would never have been able to raise the millions it did. The same goes for the many other people and organizations that have been able to raise money through $5 text message donations and viral GoFundMe campaigns.
Commissioned by RBC Wealth Management, The Economist Intelligence Unit (EIU) undertook a study of high-net-worth individuals (HNWIs) from March to May, 2018. The new face of wealth & legacy survey reached 1,051 individuals (502 women and 549 men) in Canada, the United States, United Kingdom and Asia (mainland China, Hong Kong and Singapore). The survey explores how the meanings of legacy and wealth are being redefined across regions, genders and generations.
According to the research, 53 percent of respondents globally believe new technologies have provided opportunities to generate wealth.
While many people still give money over the phone or via a mailed-in cheque, it's clear that technology is dramatically altering the way people donate and think about charitable giving. “It used to cost a fortune to start a campaign and reach a wide audience," says Christopher Burke, vice-president of digital solutions and sales enablement with RBC Wealth Management. “Now you can create something memorable that resonates with people."
According to the EIU research, high net-worth individuals (HNWI) of all ages want to increase their gift giving, while younger individuals want to make an impact with their donations. Technology, says Burke, should help them do just that, in part because new innovative tools are allowing givers to learn about new charities, and it's becoming easier to see how organizations use the money they receive. “It's changing transparency," he says. “You'll be able to see where money is being spent, distributed and the benefits of that."
Big data to drive donations
While viral videos are bringing once-hidden causes into the public consciousness, and micro-donations allow people to give small amounts of money easily, which we've seen happen after a natural disaster occurs, the giving world is only at the start of its technological journey.
One of the more exciting innovations, and one that will allow people to be more impactful with their gifts, is around big data and analytics, says Mohammed Marikar, RBC Wealth Management's London-based director of intelligence and automation.
Currently, industries like energy, retail and mining collect analytics on everything from machinery to clients. In the oil and gas industry, for instance, sensors are placed on drilling equipment to see if they're operating properly and if they may need maintenance, while workers can see if the optimal amount of oil is being extracted from the ground.
The same kind of technology could be applied to charitable projects, which would then enable donors to see exactly how a program they funded is performing. For example, say someone wants to build a well in Africa and they want to know how many people use it. Put an infrared sensor on the well and you'll be able to track how many people have drawn water from it. “It would be impossible to stand there and count how people have used the well, but now you can track that data and see results," says Marikar. If people know their money is being put to good use, then they'll be more likely to donate again.
While this technology exists, it's not yet being used in the charitable giving space. Until recently, it's been expensive to deploy and there hasn't been as much of a desire to track gifts in this more precise kind of way. That's changing, says Marikar.
Firstly, the price of technology is coming down, he says. It's getting to the point where charities, and not just cash-rich corporations, can afford to buy and deploy analytics-gathering tools. Secondly, with younger people using technology to hail cabs, order food and gather fitness data, using an app to track a charity's progress is natural to them. Finally, the demand for transparency is only going to get stronger, which means charities will have to employ tools which give donors clearer insight into what the organization does with their dollars.
It's only a matter of time before big data is used by charities across the board. “We're seeing it now, but it's mostly experimental, to see what's possible," says Marikar. “But we'll see more adoption."