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Forbes Article about DLYTE.com
Millennials Are Influencing The Future Of Philanthropy
Despite the plethora of negative myths and stigmas surrounding the millennial generation, they are a group of consumers set on making a difference in the world around them. "Add good" has been their mantra as they utilize newfound ways to give back. Rather than making random or one-off donations, they are a generation characterized by integrating the causes they care about into their daily routines and purchase behaviors.
As a result, millennials are more receptive to cause marketing than previous generations and are more likely to buy items associated with a cause, according to my research with Boston Consulting Group (BCG). They also expect companies to support the social issues and causes they care about and will reward them if they do. But this is easier said than done when it comes to certain industry verticals.
A budding option for brands? The usage of cause gift cards, such as those offered by Dlyte.com, a fundraising platform that harnesses the spending power of consumers who are supporters of causes.
To learn more about how brands can engage effectively with cause-oriented consumers in this way, I interviewed Dlyte founder and CEO Barry Shore.
Jeff Fromm: How have millennials changed the donating and fundraising experience?
Barry Shore: In the last year, millennials surpassed baby boomers as the nation's largest living generation. They are also the most diverse generation to date, which is significantly impacting the world of philanthropy. They are deeply committed to "helping" in the generic sense while not being married or dedicated to just one particular cause. Whereas previous generations gave a third of their donations to religious-oriented causes, millennials believe in more self-directed giving, such as TOM's shoes or Warby Parker.
These digital natives are fast, smart and want to do good for the world around them in their own way. It is this intersection that is dramatically changing how giving will occur in the next generation of philanthropists.
Fromm: Why would millennials be interested in cause gift cards from Dlyte?
Shore: Dlyte offers a solution where millennials can give more without making an additional donation and allocate the specific cause that their money will go to. Causes range from helping veterans to feeding children to training therapy dogs. They also have the ability to choose cards from brands that are important to them, including Amazon, Sephora, Starbucks and Whole Foods.
Fromm: In what areas have you seen the most significant potential for cause gift cards?
Shore: Millennials tend not to cook as much as previous generations and are very social. This has made restaurant gift cards of all styles – fast food, casual, fine dining – best sellers. Users realize that by ordering a digital gift card from their favorite eatery or even a grocery store via the site enables them to receive a quick, full value card that gives funds to their favorite cause at no additional cost.
Older millennials, between the ages of 25 and 34, seem to be fueling the rise in the purchase of food retailer gift cards specifically as three out of five surveyed reported buying at least one in the past year. The same holds true for the clothing and entertainment sectors.
Fromm: What benefit do cause gift cards offer retailers?
Shore: Gift cards are a growing billion dollar industry and their usage is moving from gift to spend. There is a huge untapped opportunity in the nexus of these two forces, as almost 50% of millennials are willing to make a purchase to support a cause and more than a third say they'll pay extra if they deem a cause or brand worthy. Additionally, Mercator Advisory Group found that 63% of consumers bought prepaid gift cards this year, up from 61% in 2015 and 56% in 2014. The need to connect and build loyalty with these consumers is imperative for brands.
Fromm: What future trends do you see when it comes to cause marketing in the next five years?
Shore: There are two dominant trends that will accelerate through 2025: microfunding and innovation.
Microfunding, a.k.a long tail funding, became and important and substantive part of fundraising with the successful 2008 campaign and election of President Obama. This was further leveraged in 2012 and used extensively by the Sanders and Clinton campaigns. Give $5 – even Give $3 – emails were sent to millions of grassroot (young) supporters. The ability to attract mass audience support for a particular cause in this way will become very robust in the future.
Advances in innovation will be the primary path for this way of giving. Using a device to achieve an immediate donation, especially if it is matched, increased in some way, or given at no cost is the critical stimulus. Relentless leveraging of new and even untested ideas in the tech space will be the hallmark of the most successful causes over the next few years.