Australian Tax Appeals and the GFC recovery

Get a free copy of our Tax 2010 benchmarking special report*

Whilst many charities in the UK, USA, Canada and other countries had a really tough time over the global financial crisis, Australia seemed to come off pretty lightly.

Our in depth data analysis of millions of donations across 33 charities showed a reduction in the rate of growth of income over the past two years, but it still grew.  However, our analysis of mail appeals sent last Christmas showed a lot of charities performing worse than the year before.

So how did we Australians do in the last tax / winter appeals?

We don't yet, but if you are an Australian fundraiser, please help us find out by completing a cool little Survey Monkey here.  You'll need top level information on the performance of tax 2010 and tax 2009 so that we have a context.

We will then compile the results and produce a report.  Those participating will receive a very useful, full report allowing you to benchmark yourself against all the others.  You can use the report as a great context tool in your report on performance to your boss, use it to help plan and budget, and also see if your growth or decline was due to GFC, or maybe your pack was just brilliant or, um, not so brilliant.

Thanks!

Click here for the Survey.

* Full report available to all charities who complete the survey.  Sent as a PDF to the email address provided.


Sean

James Bond trailer or Election Motivator

GetUp! doing what they do best again - 'Give us the money and we will pay for this advertisement to get aired'.  Great proposition, always seems to work.

Would you pay to air this ad?

Note for foreigners who don't follow Australian politics - Julia Gillard is our new Prime Minister, put in place after a fast 24 hour political coup replacing Kevin Rudd.  She is leader of the Labor party, which is our left-ish party, kind of like the US Democrats.  Leader of the Opposition is Tony Abbot, his party is the right-wing Liberal party, our equivalent of USA's Republicans.  The Liberal party should not be confused with the adjective 'liberal'.



Sean

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For ages I have had a problem trying to get email subscription to work easily.  I used to have it working well, and if you get this in your inbox it is still working for you.  But if you don't, please type in your email in the box to the right:

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And you will get my updates.  Thanks to Gen Y Pareto employee Kate Drewitt-Smith for fixing it for me! (She earned herself a nice bottle of wine too).

Sean

Please, more consultants speaking at conferences!

I feel a bit weird this year - it will be the first conference 'season' that I am not planning on whizzing around the world to learn and present at conferences.  I am sneaking over to Canada in November (I know, madness) and speaking at the ADMA Forum (26 July) and the F&P Forum (Sep 1) here in Australia.

Speaking at conferences is important for consultants and suppliers like me, but should there be more charity people speaking?

At the recent fundraising conference in New Zealand, an inspiring plenary from Richard Woodward reminded me why I am in this business, and even more importantly, gave me some tools to use whenever things get tough. Richard is a consultant, based in Australia, who helps charities raise money.  

I also learned things from Simone Joyeaux, Gregor Drugowitsch, Tom Ahern, Christiana Stergiou, John Godfrey and Trevor Garrett. All are consultants, except Trevor, who is head of the NZ Charity Commission. I did not attend a session presented by a charity employee.

My gripe this month is not the fact there are not many charity people speaking. What agitates me is the number of people complaining about the fact that at fundraising conferences - AFP (USA and Canada), IOF (UK), IFC (Holland) and FIA (Australia) -"there are not enough charity people speaking!"

This ‘problem' is so rife that some conferences ‘positively discriminate' to have charity people speak. This is one of those problems that's all about prejudice rather than substance. The consultants I named above work either mostly or exclusively with charities. They are charity people. They are just paid indirectly as opposed to directly, and they work for more than one charity. Surely the fundamental purpose of going to a conference is to gain learning and raise more money?

I think we should make demands about what we learn and the quality of the teaching - not who teaches us. Why should we care who delivers the training, as long as it is good? Most of these consultants used to be charity employees. For example, Gregor worked for Red Cross and Amnesty for many years.

When consultants stop working at a particular nonprofit they don't suddenly lose their knowledge. In fact, by the nature of their business, they are exposed to many more variables and initiatives than would be possible within just one charity. A consultant's session may not necessarily be better than that of a charity's ... but it's not inherently worse!

One pro-charity speaker argument is that they can include case studies and results. But from  my experience, consultants are more likely to present case studies, results and comparisons - and across several charities, not just one. This is valuable contextual information. Sharing the results of one charity using a survey to identify bequest leads is great. But having several case studies is better. It gives the student a broader context to consider.

Pareto staff members are encouraged to speak at conferences, and we give tons of information away. 

We also show real case studies with real results often (with permission from our clients, of course). We are not unique. Most consultant speakers include case studies and results; hardly any spruik their services in a crude way. Yes, they will (and should) mention what they do, and they may be cheeky or involve clients. But as long as you are learning, why do we care so much about the fact they are a supplier?

I believe most of these suppliers get up there and present for a host of reasons: ego; a desire to create change; passion for the sector; passion for their area of expertise (e.g. face-to-face fundraising); personal development - or a free ticket. Tom Ahern and Simone Joyeaux, for example, will "work for scenery"! 

Of course those reasons (except maybe the scenery one) are the same for charity staff. The big difference boils down to the last motivator for consultants: that it is good business sense. Getting up and showing people the ropes, teaching, building, challenging - this exposes them to potential customers. They don't need to do the ‘hard-sell', they just need to be genuinely helpful.

Most of what we teach is already in the books. Very little is new to the sector, but it could be new to the attendee. Explaining it well, giving examples and inspiring others is our job. And if we do it well, people will be more likely to talk to us about our business. It also means there is a lot of pressure to be a good presenter. I think that leads to probably 70-90% of presentation submissions coming from consultants.

Consultants can justify their investment in presenting because it is really good for business.  They can justify the use of company resources and the hours put into the preparation to compile the data, put together a good presentation, cruise YouTube for good video to embed, put in some practice time ... well, at least that's how I justify it to my board!

So what should (we) charity people think about all this?

Good! Great stuff! Let the consultants put in the time, let them massage their egos, let them live and become!  But they better bloody teach me something that I can do without hiring them to improve my charity's income.

Next time someone says they are "sick of all these consultants presenting" - ask them why. When they say "I want to see more charity staff up there" -  ask them why again.

(This blog is a slightly updated version of my most recent Agitator Column in F&P magazine E-bulletin.

Sean

Get Up! think out of the box

Our lovely Australian politicians do a PR exercise where you can bid for a special treat with one of them.  The leader of the Opposition, Tony Abbott auctioned off a surfing lesson with him (like Vladimir Putin he loves to show his physical prowess off - and fair enough, because he has a lot more than me).

Tony is pretty outspoken in a traditional conservative way - as well as describing climate change as 'absolute crap' his policies on refugees trying to reach safety by fleeing their homes in dangerous boats do not sit comfortably with social justice and human rights groups.

Australian pressure group GetUp! motivated donors to put in some money and bid for this opportunity - and lined up a refugee to take the surf lesson and tell Tony his story.

Campaigning genius! Tons of press (even if the bid hadn't won - but it did) and now they are running another campaign to get enough money to air a TV Ad.

Great, specific, well thought through fundraising tactics.

The importance of good writing

I have been asked to blog about a new post at Pareto Fundraising, to try and get the word out that we are recruiting, and hopefully interest you. But I also want to make my blog useful to people who may not be interested in applying, so here is my cheeky "not just a blatant ad blog."

Inspired by Anne Holland's Which Test Won I thought it would be useful to show you a standard ad and compare it with a much more thought through ad - using fundraising copy techniques such as being personal, inviting, easier to read and more interesting.

Unlike Which Test Won, I can't give you a definitive answer on the more successful one since we are just running the second one. Your feedback still welcome though!

AD One
HEAD OF CLIENT SERVICE

We are an award winning data-led fundraising and communications agency dedicated to the not-for-profit
sector. Exciting growth and continuous success with our clients has resulted in us creating this new senior management role.

Is it the right job for you?

Reporting to the CEO, you will:

• Have the opportunity to manage the teams that are growing income and strengthening supporter relationships for many of the world’s best-run causes
• Help to ensure that we’re always giving our best and only accepting startlingly good results
• Spend valuable time with our charity clients, ensuring that we truly understand their needs and how best we can meet them
• Be rewarded well, materially and emotionally.

Are you just right for it?

You will need to be a senior fundraising professional with ten years relevant experience, a proven track record in directing and inspiring a diverse range of staff, the skill to negotiate and influence at all levels, and the ability to be the new fundraising face of our innovative and groundbreaking company.

Our staff are some of the most talented, committed and hardest-working people you’ll find anywhere. They all get a kick out of getting great results for great causes, because Pareto Fundraising’s mission is nothing less than to change the world.

To apply, email your cover letter addressing the selection criteria and your CV as well as an application coversheet to hcs@paretofundraising.com.

Go to www.paretofundraising.com/join-our-team for the selection criteria, application coversheet and job description.

Applications close Friday 18th June 2010.

Ad2

HEAD OF CLIENT SERVICE

• Senior role in international Fundraising and Communications Agency
• High profile not-for-profit clients
• Sydney Central location
• Six figure salary

I need your help.

I need to find the right person for a new and critical role within Pareto Fundraising.

It’s a role that will ensure we do the very best for our clients and will drive great fundraising results for some of the most important charities in Australia and New Zealand for years to come.

If you are a senior fundraising professional keen on furthering your career in fundraising and direct marketing, challenging the status quo, and most importantly making a real difference to the world – then come and meet me. If this role isn’t for you – but you know who it’s for – have them meet me.

We are a team of dedicated professionals working together to help charities achieve outstanding results from their fundraising. I’m proud that our help has enabled these charities to raise record-breaking amounts for their beneficiaries. Now, following our growth and success, we need an expert fundraiser who is also a brilliant manager to help us lift our service level yet again.

This is a very senior role in Pareto Fundraising, reporting to me and managing the entire client service team. You will inspire great people to achieve their best ever work for wonderful causes and you will help charities across Australia and New Zealand.

It is a brilliant job. But it is challenging. To do such a big job you need to be mentally tough, analytical and have a great business brain, but also be outstanding with people. You’ll need an extensive track record in marketing and managing at a senior level (agency or charity) and, of course, you will also know fundraising intimately – especially direct marketing.

Your staff at Pareto Fundraising are some of the most talented, committed and hardest-working people you’ll find anywhere. They all get a kick out of getting great results for great causes, because Pareto Fundraising’s mission is nothing less than to change the world. Now they need your help to realise their full potential.

Yours

Jim Hungerford, CEO

PS. Applications close on Friday 18th June 2010. Please email me at hcs@paretofundraising.com with an application cover sheet, your  résumé and a letter addressing the selection criteria (go to www.paretofundraising.com/join-our-team for the selection criteria and cover sheet).

Comments welcome!

Sean

Allowing donors to donate the way they want to - priceless!

I have an annual budget I like to donate and I want it to all be on my AMEX card. It makes my tax return much easier. So I asked Everyday Hero if I could make my birthday donation by AMEX. Their initial reaction was ‘no', and they explained most of their charities didn't accept AMEX, it was more expensive than alternatives, and all AMEX card holders had other cards.

I then asked Marie Stopes if they would accept the donation direct on my AMEX. Same answer - which got me thinking. Refusing a relatively popular method of payment is not really putting the donor first.

Both parties saw the light after some quick dialogue. (To be fair, Everyday Hero was already in the process of sorting it out - but maybe I can take some credit for speeding it along!)

From the donor's point of view

I persuaded Everyday Hero and Marie Stopes by approaching the issue from a donor's point of view. Let's take a sample donor, ‘Sean'. Sean is forty years and one month old, a NIKE (no interest in kids, ever) earns about $100,000 per annum, is on the board of a charity and was recently appointed patron of another.

He aims to give 10% of his income away. He likes to keep all his donations on one card to make filing a tax return easier. As he flies a lot, that one card is AMEX (so he can bag free flights). With so many great charities to choose from, whether or not a charity accepts AMEX is often a crude technique which ‘narrows the field'.

Three reasons why charities don't want to accept AMEX

1. AMEX usually charges more than its rivals for the merchant fee, which can reduce the value of the donation by up to 3%.

2. AMEX card holders have back up cards they can use, such as Visa and MasterCard.

3. Someone at your organisation has to get around to facilitating AMEX transactions, and there are other priorities. Charities are often understaffed, and this seems a lot of effort for small return.

However.

Ten (seven more than three) reasons why charities should accept AMEX

1. AMEX donors give up to 50% more than non AMEX donors*. This negates the first reason why charities may not want to accept AMEX.

2. AMEX donors who give the same as non AMEX donors are identifying themselves as higher value prospects*. Accepting Visa instead of AMEX removes the ‘rich prospect' flag from your database.

3. Many AMEX charge cards have no credit limits, which reduces bounces.

4. AMEX regular givers give slightly higher monthly donations on regular gift programs but have a significantly higher retention rate*.

5. Richer people - i.e. best donor prospects - tend to have AMEX cards.

6. AMEX holders pay for their cards, so they want to use them. They self-justify with great insurance, a free return flight, frequent flyer points, free lounge access etc, but some of them are just poor people made good who can't accept they actually qualify for one.

7. Explaining why you accept AMEX is a useful example for customer focused training putting donors ahead of admin.

8. AMEX donors like to keep donations on one card as it is easier for tax returns.

9. AMEX donors may say that it is fine when you ask for Visa instead, but you are creating a barrier. They wouldn't have offered AMEX first if they wanted the donation on a different card.

10. You need to think about donors first!

*AMEX's own research backs this up here, but below is a table from Pareto's research, looking at appeal type gifts for one charity with a large enough sample set:

Diners should be accepted too, for the same reasons.

The point here is not that you should necessarily accept AMEX (and I assure you, they are not paying me to write this article!). The point is that a tiny decision, such as whether or not to accept AMEX, says a lot about how an organisation values a donor-centric model.

Staff from Marie Stopes told me they will be able to accept AMEX soon, which is great - it gives me time to save the unexpected higher sum of $5,000 I have to match.

Put donors first.

[Every month I write a column 'The Agitator' for Fundraising and Philanthropy magazine and this post is my most recent entry!]