Unintended consequences


I sense a certain frustration in the NCVO offices that reactions to Sir Stuart Etherington’s Fundraising Review (actually it should be noted, a review of fundraising regulation) have concentrated heavily on the proposal for a fundraising preference scheme  to allow individuals to opt out of fundraising communications.

As one of the guilty parties, I do have some sympathy with this sentiment. There is much in the review that I don’t argue with and I accept a genuine intent behind it to come up with a regulatory regime that will reinforce the confidence of donors in the charities they support. Or re establish it if that has been lost.

No one is arguing that there’s a problem with the current levels of trust between public and charities in the UK. And, while I would argue the causes are much more complex and longer term than dissatisfaction with some fundraising practices, there’s no shortage of evidence of discontent with some approaches that have been adopted by some charities.

That there is evidence for there being widespread systemic problems with fundraising practices is much more arguable. Much of what is being presented as proven evidence of malpractice consists of untested allegations made by newspapers whose reputation for reliable and unbiased reporting is, well, non-existent. Some of it is probably true, some of it is clearly distorted or misrepresented.

But the majority of the fundraising sector would probably accept that we need to think seriously about how we rebuild public confidence in charities. It’s not hard to see weaknesses in the current system for regulating fundraising. Thoughtful fundraisers have for a long time been concerned with how charities can build much better, more reciprocal and more enduring relationships with supporters.

So resistance to the proposed Fundraising Preference Scheme isn’t founded on complacency or a reluctance to accept necessary reforms. If I thought this would really help increase public confidence in charities, I for one would be a supporter.

But it isn’t going to. This isn’t just because of all the unanswered questions about how it will actually work. The NCVO’s position is that they avoided giving too many details about the working of the scheme because otherwise fundraisers would complain about not being consulted. (Something that might have been avoided with a longer and wider consultation process). But many of these questions are fundamental to the viability of the scheme in the first place.

However,  there’s an earlier problem. What is the intended scope of such a scheme? The name clearly implies that it covers all forms of fundraising. But fundraising is such a wide, multi-faceted and diverse activity that this is clearly preposterous. How can you include the brownie coming to your door with  a sponsor form, a street collector, a major donor cultivation event or a TV ad in such a scheme?

Well you can’t. The idea is ridiculous as supporters of the scheme have been swift to say. But then if the intent is not to cover every form of fundraising, whoever conducted by, what is it meant to encompass?

The intent appears to be to cover “mass” forms of fundraising. But again, this is a much more slippery concept than it seems. What channels are included? Direct mail? Definitely. Telemarketing? Almost certainly.But what else. Email?  What about other digital channels?

Perhaps the intent isn’t to include “broadcast” activities such as TV or press ads. Maybe the intended scope are “addressed” communications. But as everything becomes digital we are moving away from broadcast to narrowcast activities. So what’s the status of a digital ad served up to someone who visit your website via a cookie?

And what is “mass” in this context. Is emailing 100 people a mass activity? Is emailing 5?

And will the public understand our distinctions? Take an unaddressed letter through the mailbox (a door drop). Maybe this isn’t included in the scheme because it’s not personalised. If it was we would have to outlaw the channel because you can’t exclude people from it individually. But would the member of the public getting the mail piece on their doormat comprehend the difference?

And what is a fundraising communication? Is it only something that has a direct ask on it? If so, what forms count? What constitutes an ask anyway?  Is asking someone to sign a gift aid form an ask?

I’m not looking for answers to these questions because I think it’s impossible that a single scheme can cover all these scenarios and be something that can operate without enormous complexity or serious unintended consequences or both. Fundraising is much too broad, imprecise a concept for one central, all or nothing opt out system to work. It can’t and won’t without resulting in lots of fundraising being effectively banned. But by calling such a scheme a “Fundraising Preference” service, the expectation has been created that it will. How long before a Direct Mail campaign makes the scheme extend to the areas that it has initially left out?

Preference schemes can and do work. But in the channels that the authors of the idea  clearly have in mind (and they quite as clearly haven’t considered any others),  mail and phone, we already have MPS and TPS and both are actually quite effective. And they can be developed to work better in the future much more easily than any new scheme.
So why wouldn’t you do that?

No one has really defined the problem that the FPS is meant to be the solution for. If it’s people being annoyed by charities fundraising, well that takes all forms and a single catch all scheme isn’t going to work. Or is it, as I suspect, actually a response to issues with a number of specific fundraising channels. The three types of fundraising most complained about are (in order) direct mail, telephone and face to face/door to door. If that’s the case, let’s look at solutions to each of them. And they are not hard to find and are mostly happening already. The extension of TPS to charity warm files will eliminate at least half of all current telemarketing activities and we’ve said that door to door fundraisers can’t knock doors with a “no cold calling” sticker. For mail, we’ve got MPS for people who don’t want to be mailed at all. I think the problem here is more people (particularly a specific group of older donors) who are happy to receive charity mail in principle just getting too many mailings and that’s a harder issue to solve.

But you’ll notice, the Fundraising Preference Scheme helps provide a solution to none of these cases.

And what about the risks? We have no idea how many people might sign up for the scheme. But, as it’s quite likely to be heavily promoted by a media full of hostility to charities, the numbers could be enormous. I don’t think it’s likely to be another cones hotline. And all it will do is grow. Each time a single charity does something stupid (and how with 160,000 of them do you ensure that never happens?), more people will sign up. Charities are already learning with dismay how many of their supporters are registered with the TPS and therefore under new rules cannot be phoned. For some charities this has reduced the number of supporters who can be asked to upgrade regular gifts by as much as 70%.  This alone will cost tens of millions to the sector. Add the impact of a fundraising preference scheme across a wide range of charities and the financial consequences could be truly grave.

The Fundraising Preference Scheme is the wrong answer to the wrong question. It won’t rebuild public confidence. And its unintended consequences could well be very serious.

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