Friday, October 30, 2009

Extreme lengths to prevent swine flu...

In the lift (elevator) to Oxfam offices in Hong Kong...

And it seemed to work...

Wednesday, October 28, 2009

Bad info hurts charities

An article in an Australian newspaper has caused a bit of a media storm with the Fundraising Institute Australia CEO being interviewed on lots of radio and TV stations.

The article, by journalist Dan Flitton in The Sydney Morning Herald Newspaper has a terrible headline "Charities hand over up to 95% to street marketers" and not much better in sister paper, The Age - "Paying to collect the charity dollar".

The body of the article is not incorrect, but it really doesn't give enough information for potential donors to make a decision and the language is terrible: "... Cornucopia takes a cut - a big cut, up to 95 per cent of the total donation collected in the first year..."

Cornucopia are a fundraising firm that recruit and train staff who represent charities on the street. 'takes a cut' is pretty negative language for what is a paid for service. The 95% fees is not all profit - it goes to pay for transport, training, wages, admin, materials and more.

And of course, the donors stay with the charity for years, will upgrade, do other things and some may eventually leave money in their will. The charity gets a great return with total costs probably closer to 25% over the years.

I very much doubt Dan Flitton is a bad person. He would appear to be genuinely curious but hasn't got all the information. I imagine he would be gutted to know that his article has probably cost charities hundreds of thousands of dollars. Why?

Well, he mentions Amnesty International, Red Cross, Oxfam, MSF and Fred Hollows. Five fantastic charities doing amazing work, and raising millions of (net) dollars from F2F that otherwise wouldn't be there.

It is possible that a few donors will cancel - not many I hope, but some may. But more significantly, some staff within charities will call for their organisation to suspend (I can almost hear the 'until the media storm dies down') - or even stop - doing it.

The consequence, however you look at it, will be a huge loss of money. Ironically, some could still have to pay costs for fundraising activity already committed, but cancelled. So they will be paying money out for nothing - much worse than 25% over four years. Less money for crucial services including life-saving work and a direct consequence of this article and headline.

It won't stop there. Boards and CEOs of charities have not usually the time or inclination to really get to understand more about the intricacies of fundraising techniques and will react badly to this media. Professional fundraisers may have spent hourson research, modelling and contract negotiations only to have it vetoed by concerned boards. The consequence - much, much less money for their cause.

I am not an advocate of fundraise at all costs, but F2F is no worse in effectiveness than any other significant strategic technique - it just looks worse because the cost of staff is out-sourced. There are no other strategic methods that deliver such a huge return for charities over the long term at the same volume.

Transparency for charities is important, but the famous Otto von Bismark quote 'Laws are like sausages, it is better not to see them being made' comes to mind. Not because we should hide fundraising costs, but more because it is so complex to explain. As Peter Singer in 'The Life You Can Save' explains, cost effectiveness of fundraising and admin is NOT a good indicator of the effectiveness of a charity's work.

The volunteer that comes on and says 'I have been doing this for free for 20 years' sounds so much nicer than the backpacker getting paid a little over minimum wage. But there are not enough volunteers to go around; volunteer fundraising simply can't add enough money to come anywhere near to meeting the need.

Comments welcome!

Tuesday, October 27, 2009

I am really over long letters

Dr Barnardo wrote a four page appeal letter in London in the ‘80s using classic DM techniques – underlining, urgency, dollar handles, specific ask and a clear reference to what YOU the potential donor could do to help.

It was written in spring after a winter which had been ‘the severest and most arduous, so far as work among the children of the poor is concerned.’ He needed to raise £100 a day for food. The letter also brings to the attention of the reader that the ‘unceasing demands upon our resources’ were having an unprecedented impact.

The results of this appeal are not available, but I believe it did well.

A couple of months back, another children’s charity, Starlight, had been hit hard by the recession and they had decided to go public about their plight. They were very honest, acknowledging that part of the reason they were hit so hard was their funding strategy, which relied too much upon events and corporate support.

After reading the press stories about their plight I pulled together an ‘emergency’ appeal to their donors and met up with them. The emergency appeal was developed to demonstrate how I work, but they decided to mail it immediately anyway.

The letter is quite similar in approach to Dr Barnardo’s, except it had a couple of case studies, a cut-out of all the newspaper headlines (cleverly designed to look like it was cut and pasted using scissors and glue and then photocopied), and a rehash of some previous materials.

Whilst it would not win any awards for graphic design beauty, the appeal raised well over target, actually doubling the amount raised from donors last year.

But what interests me is that, at the heart of the appeal, was a four page appeal letter. By the way, the four page letter by Dr Barnardo referred to earlier was written in the 1880s, not the 1980s.

You would think fundraising would have changed a lot between the late 19th century and the new millennium.But when we look at the data of 23 successful fundraising charities willing to share results in a benchmarking cooperative we see that direct mail appeals still raise more than any other method (not including government and bequests).

Despite the rise of other media, hundreds of people will be starting or half-way through organising their Christmas appeal mail-out, with collective expectations of raising millions from generous Australians.

But unfortunately many will still not have learned the lesson from Dr Barnardo – longer letters tend to work better.

I really don’t like long letters, by the way. They are a pain in the butt to write, check copy, get clients approval, print and mail-merge. And someone important at most of our clients doesn’t like them. And I have lost staff with their last words being ‘...there are only so many four page letters I can proof read...!’ Ironically most of those staff are now clients proof reading four page letters. And they don’t look great in my portfolio (though the results do). And I prefer doing digital stuff. And... I think you get the idea.

In focus groups, donors say they hate them too. In Hong Kong, one client ran focus groups which all concluded that donors would be more likely to respond to a pack with a two-sided letter and tear off coupon than a four page pack (actually eight pages – English and Chinese) with lots of additional information. When they tested both approaches in a 50:50 split test, the two pager raised HK$1.5 million (AUD$220,000) – the big pack raised over HK$7.5 million (about AUD$1.1 million)

Longer letters tend to work better - but not because they are long. It is because, to tell a good story with a beginning, middle and end, and ensure the right fundraising tactics (target, what the target is for, deadline, establishing need, demonstrating solution, demonstrating why that charity is best placed to solve etc), it simply takes more words.

Having said that, a dreadful four pager is worse than a good two pager – if a story can be told more quickly then tell it.

As Mal Warwick says: ‘A fundraising letter should be as long as it needs to be...’

Good luck this Christmas.

(This post is a rehash of my agitator article in the electronic edition of the most recent Fundraising and Philanthropy magazine).

A case study on the Starlight appeal, including the whole pack in downloadable form is available here.

And finally, see Dr Barnardo’s 19th century appeal on SOFII here.

Monday, October 19, 2009

The best fundraising blog on earth

Jeff Brooks has moved employers which means Donor Power Blog has not been updated since mid September. (It is still worth trawling through the archives though - a pretty damn good overview of fundraising in there - especially Stupid Charity Ads.

His new blog is just as good. Future Fundraising Now. Check it out and subscribe.

Whatever your job in charities is, please, please watch all the Stupid NonProfit Ads on the old blog. And read why they are crap. Especially if you are thinking of running a brilliant advertising campaign in the next few months.

It is essential viewing/reading and if all charity staff watched them, and understood the point then I estimate that maybe $80m to $200m per annum more would be saved or raised.

Which, taking one of the 'costs of saving a life' estimates in Peter Singer's The Life You Save is enough to save the lives of at least 20,000 people.

You could be harsh here, and say, in other words, Stupid [Charity] Ads are worth taking the mickey out of - but they kill people.

Stop award winning stupid charity ads now!


Friday, October 16, 2009

Call that a crisis? This is a crisis...

Starlight, the Australian childrens charity, were hit hard by the global financial crisis. Their fundraising had been reliant on corporate and events fundraising and these areas turned out to be especially vulnerable.

So they decided to go to their loyal supporters with a strong, honest appeal for help explaining how they got into this situation. And it worked, raising over $600,000 (more than twice as much as a 'normal' appeal at that time of year could be expected to make).

Starlight are so cool, they are letting other charities get hold of their entire package to help inspire others. The pack can be downloaded here, and the full story is here. Oh, by the way, it only took two weeks from idea to mailing this pack.

Disaster Fundraising Guide download it here