News in focus: Direct mail goes top of the bill for today's fundraisers

Joe Gill

UK delegates reported a backlash against street fundraising and a return to direct mail at the International Fundraising Congress, while some overseas colleagues are enjoying a direct debit bonanza.

The return of direct mail, still the dependable cash cow of fundraising even if the returns are not spectacular any more, was a dominant theme in many sessions at the recent International Fundraising Congress in Holland.

In the UK, the quantity of direct mail sent out by charities doubled in 2003/4, following a 40 per cent increase in 2002/3, according to figures from the market research company AC Nielsen. In the past two years, charities have moved ahead of the commercial sector in terms of the growth in volume of mail, while more recent techniques of street fundraising and direct response TV (DRTV) began to lose their lustre.

Fundraisers have evidently chosen not to worry too much about the fact that direct marketing was voted the greatest irritant to the British public, according to a poll by BBC TV's Brassed Off Britain.

At the conference, they focused instead on improving the commitment - and income - from individual donors, by getting to know them, interacting with them and 'upgrading' them where possible through the use of information contained in charities' databases. One discussion explored how fundraisers could improve their donor 'relationships' and raise more cash by, for example, asking older donors for a legacy; and then there was the ever-hot topic of cultivating major donors.

Two years ago, street fundraising could do no wrong and DRTV was still an exciting new way of raising profile and money. Because of the huge amounts that face to face has made for charities, it remains an essential part of the mix, but the media backlash, public hostility and insolvency of some fundraising agencies mean it has fallen from grace.

DRTV is still popular with charities, but according to marketing agency Whitewater, audience indifference, an overcrowded market and the cost of airtime has meant that income ratios have fallen significantly on from the level of two years ago, when there were spectacular returns to be had.

Another theme at the conference was how various fundraising techniques play differently in different cultures. For example, big donors in the US will attend an event in celebration of their gift and to encourage others to follow suit. This is practically unheard of in Britain. Similarly, DRTV is not as widely used in Britain and Europe as it is in North America, where there are 200 channels all carrying advertising.

Cultural differences also play a part in the success or failure of other fundraising techniques, as the following examples from the conference suggest.

Canada

Amnesty International Canada doubled its income to $10m in five years and expanded its supporter base dramatically by moving from 'old media' (direct marketing), to new (street fundraising and DRTV) and by cultivating major donors.

Amnesty's director of resource development, Rosemary Oliver, says its director had sent major donors postcards from the field and tried to meet them all face to face: "One donor decided to give income worth 1 per cent of Amnesty's annual budget as a result of the director's personal relationship with them."

A welcome call to monthly donors raised retention rates from 80 per cent to 90 per cent. Oliver says: "It's fantastic because donors love you and your organisation, and they are passionate about it. It only takes two minutes - they don't usually want to talk for long."

The basic rule, according to Oliver, was that no more than 60 per cent of income should come from one income source. For Amnesty Canada, direct marketing is now a falling star compared to street fundraising, DRTV and the web. "We could have raised $800,000 on direct marketing, but by switching the investment to monthly direct debits we took in $2.3m.

"We have doubled our income over five years by taking our money out of direct mail and doing something different with it. The speed of new developments today means if you are doing the same thing now as you did three years ago, you might want to look at putting your money somewhere else."

The caveat is that attrition is higher on direct debits, and DRTV donors "fly out the door".

Australia

The director of Melbourne-based charity Kids Under Cover, Ken Morgan, was attracted to the idea of raising money by holding an open day at one of Australia's legal brothels. Sex was not on the menu, but visitors could soak up the atmosphere. Kids Under Cover builds houses for children who are victims of sexual and physical abuse, and has won many contracts with the state government of Victoria which saw it as a prototype for its own programmes.

One of his former employees recalls that Morgan, a former car salesman, has a philosophy best summed up in the phrase: "We'll take money from anyone except drug dealers". Unfortunately, when the state government got wind of the open day, the charity was told - only days before the event - to cancel it or lose its children's services contracts. The charity had to put out a public statement saying that the day was cancelled. However, it was too late, and people queued round the block to have a look around the establishment in an upmarket area of Melbourne. The charity took none of the money.

UK

Botton Village, a provider of supported housing, sent out four copies of the same special fundraising pack to each of its major donors. Having realised his mistake, the charity's director, Lawrence Stroud, decided to write a letter to each of the recipients to apologise. In it, he explained: "I've been under a lot of pressure lately - I am playing God in the nativity play." Instead of disaster, the result was a flood of money, proving what research shows - that customer satisfaction is greater following a response to a complaint, even when the explanation is bizarre.

The honesty of the response in this instance clearly appealed to donors.

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