Uri Herszbaum-Harding essay
How a Non-Profit Organization Can Fundraise with Raffles
One might say that it shouldn’t take the incentive of a prize to motivate someone to donate to a cause. Of course, while there will always be those who donate entirely out of the good of their hearts, the incentive of a prize will motivate many others to participate in the fundraiser. Whether their intentions are purely to donate, or just to have a swing at a prize, money is still being raised for the intended cause in a greater quantity than before.
In order for this technique to be effective, one has to think through what prizes are being given away. Generally, cash prizes work, as they can be converted into any good or service one desires. However, things can be spiced up a bit through material objects. On a small scale, giving out coupons or pastries may be enough to inspire people to enter said raffle. On a much, much larger scale, vehicles or even larger prizes could be given away. The effectiveness compounds; as people see larger and larger prizes, their desire to cut their losses and enter the raffle will be greater. Therefore, more people will enter the raffle, increasing the amount of money even further.
While the organization hosting this raffle may be non-profit, the raffle itself must be for profit. Money is being put into the prizes; if the organization cannot reap an income far, far greater than what was spent, then the money invested in the raffle would have been better spent simply donating directly.
Maximizing this income is a game of probabilities: yes, math. In order to maximize earnings, an organization needs to collect great amounts of vital data and know the population that they are trying to appeal to. Is this raffle held at some sort of event, offered automatically for anyone who registers? Is it being sold as an independent lottery? The idea is to figure out how many people will purchase the tickets, at a given price. Several factors go into this.
First of all comes the question: is this being held as part of an event? If the event is appealing enough—say, a music festival or gaming convention—people will be willing to pay higher prices for entrance. A possible range could be 20-60 dollars per ticket, depending on the nature of the event. In this instance, the idea of a raffle coming with the purchase of a ticket is simply a little extra spice, something that will have people leaving the event feeling like they won and others thinking “better luck next time!” Either way, this inspires people to continue going to annual repetitions of this event, therefore increasing ticket sales. In this case, it is not so much the raffle itself as the sale of event tickets which brings in revenue. One should take into consideration that the earnings will be impeded by the price of hosting the event.
If, on the other hand, the raffle is being executed lottery-style, people will be motivated entirely by the expectation of prizes. In this case, one could use a strategy similar to lotteries such as the Powerball and Mega-millions. Ticket sales would be super-cheap. People would think, “what is there to lose?” Through this, depending on the scale of this raffle, thousands or even millions of people may participate. The scale depends entirely on how many locations have volunteers selling tickets, where and how often advertisements are being shown, and so on. Going this route, creating an online raffle could be an effective route. The fundraiser could spread like fire through social media, while avoiding the insane cost of a massive ad campaign.
Once the expected income of the fundraiser has been established, the rest is simple. Subtract the cost of hosting the fundraiser. The total value of the prizes should be a fraction of what is remaining. So, if a fundraiser is expected to earn a million dollars, an organization can safely give away vehicles, televisions, or five-figure cash prizes. In the case of one charity event I attended, the organization raised around 20,000 dollars. Assuming that a lot of it went to the building hosting the event, and a couple thousand were spent on prizes, I expect the remaining several thousand was ultimately given to charity. The prizes distributed were incredibly effective; after winning a 40-dollar keyboard, I know for a fact I will be going back, for the experience of the event and the chance to win even greater prizes.
Now that a business model has been established, there comes the question of how to motivate volunteers to sell these tickets. Many would do it simply for the sake of the fundraiser, yet almost all would become more productive with incentives. So, we digress to the previously established business models. If the raffle is tied in with an event, volunteers could be given free entrance to said event, as well as a chance to participate in the drawing. To incentivize volunteers to sell mass amounts of tickets in a lottery-style fundraiser, perhaps smaller prizes or increasing chances to enter could be given to those who sell the greatest quantities. Or, simply contact the National Honors Society of some nearby high school. Their members are often striving to earn hours to go towards their goals in the Society and are always happy to help. I speak from experience.
Once again, I digress. These techniques, as I have presented them, are mostly theoretical; however, they are based off of practices used in the real-world, some of which are extremely effective. While some of the specifics may vary wildly—the price of the ticket, the size and individual quirks of the population that is being exposed to the fundraiser—I firmly believe that these general ideas are what one should utilize when creating a charitable fundraiser.