New line of attack on charities

A journalist attended the recent FIA conference at the Gold Coast and wrote lots of stuff about charities and how they do their fundraising.

To be honest, he is bloody good at his job - he has managed to get front page of one of Australia's best selling tabloids and syndicate the story across the nation and it has been picked up by other media.

It is easy to knock him, or accuse him of doing a hatchet job, ignoring the good stuff and spinning amazing stories out of nothing - but that after all, is his job.  And he will be looking for the next angle.

But our bosses will be worried, some charities are specifically named (but not really accused of anything) and it is easy to panic and do something silly.  Some donors will maybe get a little worried about it, but overall it shouldn't make much difference to our ability to fundraise - unless we do something daft in response.

The very worst things we can do, as a sector, are give any credence to the nonsense printed, or give the press examples of conflict between charities which will act as an accelerant.  Approaching the journo or his employers is not going to help.  He is, after all, not stupid - he knows that his story is completely out of context, but it is a great career boost.

Please, charity media departments, think it through before you release your media statements but don't add any credence to what he wrote by saying things like:
* We would never pay professional fundraisers to work for us (kind of cuts future options for you)
* We only target people already supporting us (where will you get new supporters?)
* Apologizing for salaries
* Undermining fundraising techniques that you may not use, but others do very succesfully.
Put up a public statement, complain to the newspaper and talk to your key stakeholders; defend your good practice but do not knock other charities - even if just by implication.

The two areas specifically attacked were bequests and face to face.  Here are some facts you can use when talking to people - even if you don't use these methods.  The data is taken from looking at 41 Australian and New Zealand charities in the Pareto Benchmarking program.

* About half of all individual donations from 2001-2011 came from bequests
* In 2011 bequests accounted for about a third - because other methods are growing
* Regular giving is one of those areas growing (also accounts for about a third of individual donations) and by far and away the largest source of regular givers is face to face
* Generally speaking, people don't give unless asked, and asking costs money

All the way through - focus on the outcome; start with a case study "Little David had cancer but...." and then point out how many little David's were helped as a consequence of your fundraising.

And don't knock Richard's training techniques (he got attacked for making jokes about raising money from the dead): It is well established that shock, unexpected comments and humour improve learning.  If any of you know nurses, care assistants and ambulance workers you will know they deal with stressful situations with humour which is appropriate at the time but sounds terrible when re-told out of  context.

For a great summary of the story, don't bother looking at the paper - there is a brilliant summary from fundraising database supplier AppiChar 'Journalist targets Australian population with Dumb Story'.

"Charities target the elderly and dying for bequest dollars.

In a shocking turn of events, it was discovered via the undercover reporting ...that organisations across Australia, many providing some of the most important services to the country were:

• Taking a strategic view of their funding requirements
• Doing everything they can to make sure they tell their story in the most efficient manner to the right people in order for those people to make an informed choice about the money they spend
• Were sharing knowledge on best practise to help make sure they weren’t wasting time and money..."

Read the rest here.

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!