Direct response TV is one of the oldest forms of TV advertising, according to Mark Dodd, digital manager of charity communications organisation the Media Trust.
Although the method is now often associated with the rise of multiple digital TV channels and expensive 15-minute infomercials, charities have been using 60 to 90-second TV adverts to raise money for about 25 years.
"With traditional TV advertising you can raise awareness, but you can't ask people to donate," says Dodd. "With direct response, you can do both."
Mike Colling, founder of media buying agency Mike Colling & Co, says direct response is one of the best methods of fundraising. "You can recruit large volumes of relatively loyal and high-value donors, with better returns than from other channels such as direct mail," he says.
Colling argues that this is because you can offer viewers the choice of donating by phone, text or online at the same time as providing information about the charity. Another reason is that television allows advertisers to access broader audiences than those targeted through door-to-door or direct marketing campaigns. But Colling advises charities not to bother with television advertising if they want to access a niche market: "TV is best for a wide base."
The Dogs Trust uses direct response TV to recruit support for its Sponsor a Dog campaigns. Kerry Glover, deputy head of fundraising at the charity, says it is cheaper than print advertising and easier to monitor than traditional TV campaigns. "It is impossible to measure the success of an awareness-raising TV campaign," she says. "With direct response you can see exactly what returns you are getting."
Dodd says the direct response industry works on a 0.02 per cent response rate, which is not bad if one peak-time airing is viewed by as many as two million viewers. Colling says charities can boost the performance of an advert by 15 per cent by including an option to donate by text. But the telephone is still the most popular way that people respond, with a 70 to 80 per cent conversion rate.
That's not to say direct response is without its challenges. Colling says adverts must go one step further than awareness-raising campaigns: they must not only convince viewers that a financial contribution will make a difference, but also persuade them to make immediate contact with the charity.
James Griffiths, client services director at media agency WWAV, handles television fundraising appeals for charities such as Cancer Research UK and the NSPCC. He says adverts must establish the need for financial contributions within 30 seconds.
Charities also need to avoid conveying too positive a message, otherwise there is a risk viewers won't respond, adds Mike Flynn, head of direct donor marketing at the NSPCC.
As with all advertising, the cost of direct response can be prohibitive. Charities should expect to pay £15,000 to a media agency and between £40,000 and £60,000 for six to eight weeks of airtime, says Griffiths. However, the cost of airtime has fallen by 20 per cent since last year, and a good media agency may be able to secure further discounts.
Dodd says agencies are better placed than charities to select the most lucrative channels, although that doesn't mean charities should not do any market research of their own. "Understanding your audience is integral to any campaign," he says. "It doesn't matter how good your advert is if it's not reaching the right viewers at the right time."
The cost of creating the advert can be anything from £10,000 to £150,000. But there are ways to reduce this. ActionAid, for example, rotates the same advert across different TV channels all year. Its supporter recruitment manager, Jennie York, suggests searching archives for old footage or using film expertise in-house.
However, the interactive 'red button' facility available through digital TV and Sky got the thumbs-down from organisations contacted by Third Sector.
"Set-up costs are £5,000 plus airtime," says Colling. "Low conversion rates mean your annual return on investment becomes three times lower. It may be useful for information campaigns, such as providing advice to cancer sufferers, but you still pay for additional content."
High attrition rates are one of the persisting challenges of direct response. But York says: "We try to counteract this by picking channels that attract a cerebral audience more likely to think hard about whether or not to donate."
Direct response is certainly worth a try and, as Glover says, it is less of a "leap of faith" than some fundraising methods.