With the close of Amazon’s long-running Smile program last month, the charitably minded have one less outlet for their philanthropic desires. The program allowed customers to donate a portion of eligible purchases to their charity of choice. Amazon ended the program despite many nonprofits’ reliance on these proceeds to supplement their income.
A statement from the online retail giant explained that “after almost a decade, the program has not grown to create the impact that we had originally hoped.” What exactly the impact was meant to be is unclear. The program did successfully give away nearly $450 million over its near-decade existence, with an average gift of $230 per charity, but some receiving significantly more.
Indeed, Amazon’s closure of its Smile program is indicative of a larger shift nationwide in philanthropy, as the number of small-dollar givers decreases and mega-donors increasingly direct large sums of money to pet projects that many Americans would never dream of supporting. This vacuum is one everyday American givers should fill if only we could create more pathways to charitable giving.
As the Fundraising Effectiveness Project reports, “Almost all of the [recent] drop in donors (96%) is attributable to losses of donors [who give] $500 and less…Based on reporting in past years, we expect the proportion of major and supersize donors to increase.”
Some might argue that simply designating a charity to receive a small portion of the money you’re spending anyway hardly counts as charitable giving—but any sort of giving takes a little bit of effort, and the act of picking a nonprofit and using the unique URL when buying something is, sadly, more philanthropic planning than a growing number of Americans do.
With Amazon out of the picture, those who want to see a thriving charitable sector must ask if there are other ways to correct the growing imbalance in philanthropic free speech. One avenue is for nonprofit leaders and lawmakers to support philanthropic initiatives that give voice to every American’s charitable goals, not simply the charitable goals of a few powerful billionaires.
As my DonorsTrust colleague Carolyn Bolton writes, “Americans are in the trenches” and, as a result, they have a better idea of their community’s needs and, ultimately, they “know best where to put their charitable dollars.”
This should be our guiding principle as policy analysts, nonprofit executives, and others endeavor to bring small-dollar givers back into the charitable fold. On the legislative side, we see efforts like Sen. James Lankford’s (R-OK) “Universal Giving and Pandemic Response and Recovery Act,” which would make the charitable tax deduction more broadly applicable.
As Sen. Lankford said during the pandemic, “In a world that has changed significantly in the last year, we have seen more than ever the need to encourage giving to local nonprofits and houses of worship to support their selfless service to those in need.”
Joanne Florino, the Adam Meyerson Distinguished Fellow in Philanthropic Excellence for The Philanthropy Roundtable, in a recent piece echoes Sen. Lankford, underscoring the importance of small-dollar donors to local economies: “We’re in the middle of a sea change in philanthropy in which our nation is losing the small givers who support the local food pantry, YMCA, or library. The big philanthropies are giving more, but these funds tend to flow to major medical centers, museums, and similar large-scale institutions,” she says.
Nonprofits have a role to play as well. Major gifts fill coffers quickly, but they can be fickle. Plus, the Jeff Bezoses and Warren Buffetts of the world aren’t going to give to your local animal shelter or art collective. Those groups—and those they serve—depend on “every day” donors in the community.
Nonprofit leaders must devote time to attracting those local givers and working together to expand the pie. We don’t have Amazon to smile down on the vast array of America’s nonprofits anymore.
However, with a broader, fairer application of the charitable tax deduction coupled with charities making a concerted effort to catalyze small-dollar giving, we can see a renaissance of charitable engagement in communities across the country.
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