I’ve been working with quite a number of charities of all sizes recently, both on a consultancy basis and with my fundraising agency Audience. Very many of them are struggling with one issue above all: in the new world of more regulated fundraising and increased donor scepticism, where are the new donors going to come from?
For many charities the highest volume of new regular givers for the past decade and a half have come through dialogue channels (face-to-face/door-to-door/private sites). These are now under huge pressure from declining sign-up rates and high donor attrition driving down returns. Agencies have gone bump with alarming regularity. With new regulation, the future looks uncertain.
Cold direct mail has been the main source of single gift donors. But already suffering from very low response rates, this has been dealt a body blow by the demise of charity list swaps, which underpinned an awful lot of programmes, and threatened by the future move to opt in and the Fundraising Preference Service.
The other volume sources responsive donors through direct mail have been inserts. Response rates here have been declining for years, while high opt out rates mean that large proportions of responses don’t turn into donors. Unaddressed mail (doordrops) have similar issues.
DRTV continues to work for charities but only for a select few who have the proposition and the money and perhaps most of all, the expertise, to do it properly. It has always been a channel where it’s been very easy for the unwary to lose money and that isn’t likely to change.
Similarly press display, which has always been hard to get to work at scale, is an area where there are still opportunities but which is very easy to get wrong.
And what of newer channels and approaches? Lead generation or two- step approaches showed a lot of promise for a while. Various media channels from face-to-face to outdoor advertising to TV at times worked very well in producing leads through value exchange propositions for follow-up marketing.
But channels such as panel ads on trains got congested very quickly and getting a good ROI from a multi stage approach was already challenging before data protection and opt ins became much more onerous and killed this approach for many charities. The same issues were true of text giving, which used the same channels with a different payment method.
But that’s OK because we have digital, right? That’s where the audience now is and we have a gazillion cool ways of reaching them.
Yeah, well here’s the thing. For most charities now, any digital channel is producing so few new supporters as to be hardly worth counting. The world wide web is nearly 30 years old and yet for very large numbers of non profits, it has been a non event as a channel to produce new supporters.
Sure, there are exceptions and some charities are doing well in some specific channels. Facebooks ads for instance are growing fast. But only a small minority of non profits in the UK generate substantial numbers of new donors online and have these form a significant proportion of their overall new donor acquisition.
Actually getting digital to work as a source of new supporters is pretty hard. And again, there are major barriers in many charities to achieving this. Lack of expertise is a big issue, lack of understanding by senior staff of what is required is probably a bigger one.
So that’s a fairly bleak picture. But hold off the despair just yet. What is happening, I think, is the end of one fundraising world and the birth pangs of the new one. We are moving away from the fundraising I knew when I joined the industry pretty much at the same time Tim Berners-Lee was inventing the world wide web. Then you could put some fundraising copy out in a single channel, count the money coming back and know whether that had worked and if so, do more of it.
What we have today is much more complicated. What will work today is integrated multi-channel marketing at an organisational level. It needs an ability to look across the whole marketing mix and construct a series of messages and have the analytics to work out the most effective combinations. Fundraising basics haven’t changed but the delivery has completely.
Tobin Aldrich is a fundraising consultant and chief executive of the direct giving charity the Misfit Foundation