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 form?
There’s been, rightly, much focus in the past few months on existing supporters and how to engage them more to ensure they give more and for longer. People like me have had much to say about how existing supporters have not received the attention they should from any charities and how this needs to change. That’s all entirely true and there’s definitely signs that fundraisers have heard this message and are responding. There’s certainly plenty to do here.
But what if you don’t have the supporters in the first place? Or not enough, even with the most imaginative stewardship and development programme to allow the charity to raise enough money to meet its mission and serve its beneficiaries. And even with the aforesaid mother of all supporter experiences , donors will still stop giving or die. So charities still need to find new givers and in some volume.
The question is how? And where from? If you look at all the methods that UK charities have used in recent years to acquire new supporters there are problems with, well all of them.
For many charities the highest volume of new regular givers for the last decade and a half have been 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 ROI. Agencies have gone bump with alarming regularity. The future with new regulation 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 (reciprocals) which underpinned an awful lot of programmes. Threatened by future move to opt in and FPS. The other volume sources of direct mail responsive donors have bee inserts. Response rates here have been declining for years while, high opt out or anon 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 to do it properly. And perhaps most of all the expertise. 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 the channels got congested very quickly (remember train panels) 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 thirty years old and yet for very large numbers of non profits as a channel to produce new supporters it has been a non event. 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 both 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 Tm Berners-Lee was inventing the internet. 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 changes but the delivery completely has.
In Part 2, I will talk about how charities can recruit new supporters in the new fundraising world