Should Charities Reduce Efforts to Attract New Donors?

January 30, 2009

Should Charities Reduce Efforts to Attract New Donors?

In tough economic times, fund raisers often face pressure from board members and constituents to cut back on costly direct mail and telemarketing efforts to recruit new donors.

But short term gain can mean long term pain for an organization, warned Craig Finstad, assistant vice president of direct-response operations at the American Lung Association in a speech at this week’s Direct Marketing Association Nonprofit Federation conference in Washington.

He pointed to the experiences of one of his charity’s affiliates, which decided to stop spending money on recruitment efforts during the last recession in 2000. Over the following seven years, said Mr. Finstad, the affiliate’s donor pool declined by 70 percent.

Mr. Finstad also cautioned against making big changes to the format or schedule of direct-mail appeals in reaction to economic conditions or other external pressures without careful testing to gauge the potential impact.

For example, he said, after the postal service increased rates on big mail pieces known as flats, the Lung Association considered replacing a traditional large-format mailer with a letter appeal. But a test of 50,000 letters yielded an 11-percent decline in income.

“If we had just rolled out with the letter format at the volumes that we mail, nationwide we would have lost almost a half a million dollars,” said Mr. Finstad.

What has your experience been in cutting direct-mail appeals to potential donors? Have you found enough replacement revenue to make it worthwhile?

— Paula Wasley

Comments

Duh, direct mail marketers don’t think that charities should cut back on direct mail? What a surprise.

What about email solicitations? What about cultivation events? There are other ways to retain and grow your donor base!

— Stefanie Steel Jan 30, 03:18 PM #
“Interruption” marketing stratgies (as its become to be known) such as direct mail or telemarketing is becoming a less successful or viable avenue for attracting new donors or members. Nonprofits are behind businesses in discovering that internet technology has significantly impacted the way in which client relationships are built and maintained. Marketing is not longer a one-way conversation, and it shouldn’t be. Social Media applications are readily available at a minimum of cost and time, and can connect you with thousands of constituents ready to know what your organization is about, and are ready to share their experiences and thoughts about your cause. The key to broadening your reach is to create a presense where your new donors are. Pew Research released a report that 35% of the millions of social networking users are adults. Instead of sending mail, create a page on facebook and build a following of 50,0000+ new fans like The Red Cross, and Humane Society have done. You do not have to be big to create a site and gather fans. Tiny nonprofits attract fans in the thousands as well. These sites broaden your reach and allow you to have dialogue with your supporters and potetnial supporters. Create a Facebook page, begin a blog, and then post links to these on your site and send an email to your constituent list asking for their input.
Some handy places to get started are:

Creating Your Social Media Map: http://snurl.com/b2jr2
Integrating Social Media Into Your Marketing Plan: http://snurl.com/b2kcq

— KirstenW Jan 31, 04:05 PM #

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Should Charities Reduce Efforts to Attract New Donors?

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