A New Source of Funds for Nonprofits: Product Recommendations! by Kris Putnam-Walkerly

By Kris Putnam-Walkerly.  Reposted with permission from Philanthropy 411. 

The Great Recession has hit nonprofits hard. The most recent Chronicle of Philanthropy survey found that donations to the nation’s biggest charities dropped 11 % last year – resulting in billions of dollars in lost revenue. It’s the worst decline since the survey started 20 years ago.

The good news: There is a large, promising, and rapidly growing new source of funds to support great causes — and you probably never thought about it before (I sure hadn’t): Product recommendations, through a cool new service called Rec.fm.

Rec.fm, a 2010 SXSW Web Award finalist, is an online service where you can recommend products you love for the causes you care about. It works like this: You love a product (a book, iPad, watch, Coach purse) and you write a brief 140-character recommendation of that product on the Rec.fm site.  You can leave the ‘rec’ on the site, share it with your friends or post it on your Facebook profile like this:

When someone else buys that product by clicking through on your recommendation, the merchant (e.g. Amazon) gives Rec.fm a referral fee (this usually ranges from 5% – 25% of the purchase price, and can be even higher!). You choose from one of Rec.fm’s many nonprofit partners, such as Grassroots.org, Water.org, American Red Cross, Kiva, National Foundation for Cancer Research, and Autism Speaks, and Rec.fm gives that nonprofit 51% of the referral fee! This 55 sec. Rec.fm Video gives you a quick overview.

Rec.fm has the potential to be a huge source of revenue for nonprofits. It’s designed to take full advantage of the viral “sharing and helping” nature of social networks like Facebook and Twitter, and active users of social networks spend about $150 billion annually (yes, billion with a B)  buying products online — an amount that is growing 52% per year.  Social network users are also increasingly concerned about helping people and communities in need.

Full disclosure: I’m an advisor to Rec.fm. But don’t just take it from me — Rec.fm has been featured twice on Mashable, including on their Spark of Genius Series,  other national blogs such as LifeHacker and JustMeans, and they were a 2010 Web Awards finalist at the South By South West conference. The service is fully operational in public beta, and integrated with Facebook and Twitter, as well as with major commerce networks such as Amazon.com, Apple iTunes, and Shopping.com.

You can check out my  recommendations for all my favorite baby products  here on my Rec.fm profile page which looks like this:

(When I am not consulting to foundations I’m caring for my totally adorable twin babies — see photo above!). If you have little ones in your life or upcoming baby showers, you can click the product links to purchase them, and the nonprofit I chose — Water.org — will receive a check for 51% of the referral fee!  You can also buy a recommended laptop or Play Station 3 to benefit the American Red Cross, an iPod Touch or a digital camera to benefit the National Center for Cancer Research,  or organic snail repellent to benefit Kiva, etc., etc.

Rec.fm isn’t the only site where you can use your purchasing power and knowledge to help great causes.  Here’s some other sites you should check out as well:

• GoodSearch.com – donate to causes every time you do a web search

• Endorse For A Cause – turn your online shopping habit into a fundraiser for the cause of your choice.

• SocialVibe – donate money to your selected charity based on participation in branded activities like surveys

If you are a nonprofit and want to learn more about partnering with Rec.fm, leave a comment and I will be sure to make the introduction to the Rec.fm team!

If you found this blog post useful, please subscribe. On Twitter? Follow me @Philanthropy411.

Posted by Kris Putnam-Walkerly © Kris Putnam-Walkerly and Philanthropy411, 2010.

A New $5 billion opportunity for us to help Non Profits impact big problems

How we can create financial contributions for great causes by simply sharing our knowledge of great products

Katherine Fulton in her moving Ted Conference address (discussed below) spoke eloquently about the new opportunity afforded us by the internet to solve problems via ‘mass collaboration’. Nowhere is the power of mass collaboration more pronounced than in our opportunity to “vote with our mouse” on how hundreds of billions of dollars of online commerce will be spent each year.

In fact, the 250 million active users of Facebook and Twitter alone spend about $125 billion a year in online commerce. Conservative projections are that commerce partners (such as Rec.fm) “voting for charity’ could easily direct $5 billion a year to non-profit organizations such that great progress could be made on huge problems like fighting cancer.

So here’s how you can “start voting” and creating real contributions with your product knowledge and your buying habits:

1) Use your product knowledge rather than your cash to create real financial donations

Everybody has discovered products that simply work great or are great values. Rec.fm is somewhat unique in that you can create real financial contributions for causes you care about by simply sharing your knowledge of great products.

In really just a minute or two you can 1) access the rec.fm website via your Facebook account, 2) write a brief description of why you love a product and 3) share it with your friends on Facebook, Twitter or other networks.

Your product recommendation is indexed by search engines so that others can easily find it. When the product is purchased roughly 3% to 5% of its purchase price goes to a great cause you selected. Additionally, when your recommendations result in even a few dollars of contributions a Charitable Donation Confirmation Receipt will be sent to you by the charity.

2) Buy online at sites that give a significant share of their earnings to important causes

When you search and buy products via rec.fm you buy the same products for the same prices that you do if you bought directly on Amazon.com (Amazon is one of Rec.fm's partners). The difference is that roughly 3 to 5% of purchase price of everything you buy goes to great causes you chose like the Red Cross or the National Foundation for Cancer research.

In addition to Rec.fm many other organizations can be found on Facebook which direct a portion of their revenues to good causes.

Small habit changes multiplied by millions of netizens will cause sea changes in our culture and our ability to solve big problems. Thanks for doing your part to help out and thanks for telling your friends how they can help out too.

The Democratization of Philanthropy

Katherine Fulton in her moving Ted conference address spoke about a “democratization of philanthropy’ which is taking place because of the mass collaboration opportunity afforded us by the internet and because of ‘a new moral hunger’ which is arising.

She quotes author Clay Shirky who notes “we lived in a world where little things were done for love and big things for money .....suddenly big things can be done for love”

Katherine notes “We are not thinking our way into a new way of acting but acting our way into a new way of thinking” because "philanthropy is about the giving of time and talent as much as the giving of money".

If talented knowledgeable technologists like Ted Griggs can easily and quickly extend their knowledge to help senior citizens like Esther Appler and open her life to the rich opportunity of internet video - (Ted's solution for Esther) and if great charities like the NFCR.org can benefit substantially in the process - then most certainly this transaction multiplied by internet scale can do some serious good.

This then is the mission of rec.fm to simply do our part to facilitate one-on-one people helping people to the benefit of some great causes.

When you can, please watch Katherine Fulton deliver her inspiring Ted conference talk.

Also, please ask your friends to stop by rec.fm and simply recommend some products they love to help us help others and to change product recommendations for good.

Help us change recommendations for good

First off - let me say that we have relatively few answers as to how all of this will eventually work. The good news is that we are starting from a decent place: 51% of rec.fm's net earnings go to charitable causes. Whatever happens charitable causes will always be the the biggest beneficiary of our site. Always. No matter what. Take it to the bank.

From that point on, the community - the great folks who take the time to make and use recs in order to help causes greater than themselves - they are the ones who will guide this ship and help determine the right combination of enablers and controls necessary to change recommendations for good.

So c’mon in, sit down and tell us your thoughts. Let’s build something we're all proud of - something that really helps out.

rec.fm blog - The voice of "Great Recs for Great Causes"

Rec.fm is all about making it easy for busy people to create and find trustworthy, concise recommendations for things they truly love or badly need. rec.fm identifies 'great recs' and provides the majority of our revenue to the the charitable causes of our 'great recommenders" (more about rec.fm)

The rec.fm blog is the voice of our community - passionate recommenders - and that of our mission - to create a systems of incentives, measurements and enablers which will encourage people to make great recs, which will help their friends and help some great causes, too.

Everything old is new again - People want 'recs' from people they trust

In days of olde, people received recommendations on things to buy by way of conversations in their village. People judged and acted upon recommendations for butchers, bakers or candlestick makers based upon how familiar they were with the recommender or with his reputation in the village.

With the advent of mass media people started reluctantly listening to radio or reading newspapers to try to find recommendations on what to buy. When the internet emerged it was search engines who instructed folks on what and where to purchase something.

Happily with huge advancements in social media “conversations” are back in a big way and we can now get product and service recommendations from where we really want to - from individuals we know or from those whose reputations we trust.

In fact very recent studies by Neilson & JDPowers have shown that in today’s advertising-saturated world we are increasingly reliant upon personal recommendations for our buying decisions.

New Web Order: Great Recommenders will trump great search engines

In an enormous shift of attention on the internet, we are now spending more time in social conversations then they are in email! Additionally, we just don’t have time to sift through long-winded restaurant reviews to try and filter out the reviews written by the owner’s brother in law.

We want concise, trustworthy recommendations from those who are socially relevant to us.

My friend, Matt, is a brilliant engineer retired from a major technology firm here in valley. When I needed to buy a compact camera and didn't have any time to do research I asked Matt if he could recommend one. Matt had spent a lot of time researching and using a new model Canon and told me he would recommend it highly.

I valued Matt's recommendation not just because of his skilled research but also because of the relevance of his recommendation. I know and trust Matt and, like me, Matt has three kids, loves sports and loves to travel.

I bought the Canon 870 Matt recommended. I have never owned a camera more appropriate to my lifestyle. I have taken it around the world and am thrilled with it. I also recommend it highly: Canon870 rec

When Matt initially made the rec I Googled the camera and bought it online. Sadly Matt created great value with his recommendation but Google reaped that value. In the new "post search" phase of the internet value will flow to great recommenders like Matt and the causes they value. In this new phase people like Matt will be able to make material contributions to great causes not by giving money but by simply using their talents and recommending products they love !

Please tell your friends who are great recommenders like Matt about rec.fm so they can help their friends and help some really great causes in the process.