Direct mail, for so long the charity sector's fundraising mechanism of choice, is facing unprecedented criticism. With more than three million households now registered, the Mailing Preference Service is severely limiting the number of prospects that can be mailed. A 2006 survey of 10,000 consumers by Nielsen Media Research for Marketing magazine found that 30 per cent of charity direct mailings were binned unopened.
Others argue that direct mail harms the environment: even if a campaign generates a 5 per cent return, that is a lot of wasted paper. Other critics question the wisdom of inserts such as pens. As long ago as 2004, Amnesty UK declared that recipients saw pens as gimmicks, so it stopped including them in its mailings. Other charities are considering following suit, particularly after the Royal Mail's introduction of 'pricing in proportion'.
However, charities continue to invest in direct mail. Matt Hunt, Clic Sargent's head of marketing, says: "It is still a major source of income for us. Revenue remains relatively static, and feedback from donors suggests they enjoy being able to read about the charity's operations and how their contributions make a difference."
Overall, charities increased their use of direct mail by 9 per cent in 2006. They now send a total of 43 million mailings a month, at a cost of more than £213m a year. Direct mail accounts for more than 70 per cent of charities' marketing budgets.
So it is perhaps timely that the Institute of Fundraising has just begun consultation on a draft version of its very first code of practice for direct mail. "We don't want to be prescriptive," says Lindsay Boswell, chief executive of the institute. "We want to gather views from everyone in the industry on issues such as frequency and technique. For example, is it right for charities to post umbrellas to elderly people, explaining they will provide more shelter than an African boy will receive in his life and asking for donations equivalent to the cost of the umbrellas?
"Direct mail is an essential technique and we absolutely support its use," he says. "However, we need to balance short-term fundraising with the long-term reputation of fundraising. We need to think about whether it is justifiable to base appeals purely on guilt in this way."
- See Opinion, page 7.