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February 2012

Do we need a street fundraising cap?

The news that Gift Fundraising has gone into voluntary administration took a lot of people by surprise.

As they were one of the largest and longest established street fundraising suppliers in the country, then alarm bells must be ringing across charities and agencies who do face to face fundraising, both on the street and door to door*.

I'm a big fan of street fundraising and want to see it survive and flourish for the foreseeable future. 

However, with more and more site access agreements being struck between councils and the PFRA - which inevitably restrict the days that charities can fundraise on their streets - and with evidence that it is becoming more expensive to recruit donors, then what can we do to try and rescue this method that has recruited so many new donors over the last 10-15 years?

Well, to begin with I'd like to see charities take up more of the 50 ideas suggested to improve face to face fundraising in this article by Ken Burnett.

More controversially, I think there is a natural plateau for face to face and we are either close to, or have already, exceeded it.

Over the years the costs of recruiting people via face to face have steadily increased (direct mail faces a similar problem) and there comes a point where the marginal cost of recruiting the next donor is so high that it becomes uneconomical.

However, to try and reduce the cost and to make it economically viable again, then we would need to introduce a cap on the number of recruits.  If no charity was allowed to recruit more than a certain number of donors a year (be it 5,000, 10,000 or 20,000) and the sector as a whole committed to only recruit 700,000 donors via face to face (around 730,000 were recruited in 2010/11 according to the PFRA), then perhaps we can make face to face fundraising more cost effective and less subject to aggressive hate pieces, like this one that was in the Daily Mail recently.

The big challenge would be convincing charities (especially the larger ones) to sacrifice their short term gain for the long term benefit of the sector as a whole, but the danger is that if we don't act as a sector then face to face might just get regulated, and/or ignored by the public, to extinction, and that would be a shame.

 * Although Gift were a street fundraising agency, I fear the street fundraising 'backlash' will shortly spread to door to door fundraising.


Weekend Reading Round Up

I attended another excellent NFPtweetUp this week and enjoyed the presentations on the Beatbullying's 'Big March' and BHF's 'Hard and Fast' campaign.  A big thanks to everyone at Beautiful World for organising it.

Back in the real world, here are some links for you to read this weekend.

Advice for Good comment on some interesting research on predictors of charitable giving.

i-fundraiser on nurturing donors

The introduction article of a six part series on why non profits fail - from the guys at Passionate Giving.

A post my dad would like! Aline with lessons about fundraising from Hancock's half hour.

Tom Ahern on keeping your message and story consistent across communications.

Steve suggests you go ask your mother...

Kivi with a thanking donors case study.

Jeff on why you shouldn't skimp your donors.

Katya on making your audience part of the story.

Margaux on getting away from your desk and connecting with your cause.

Simon George on creating a legacy culture.

Alison on managing selflessly.

Kevin on cutting red tape.

Scott Berkun with two articles on brainstorming and group think.

Successful fundraising needs excellent leadership

There's been a lot of buzz on Twitter this week about the Fundraising magazine story on Christian Aid deciding to dump the Head of Fundraising role.

It's an interesting and brave decision, with the consensus being that it is a bold plan, but one fraught with danger and a high risk of failure.

From my point of view, the best (and most successful) fundraising teams I have worked with and observed have all had a strong leader, who imparts their vision and fundraising philosophy on the team. 

They drive through the necessary changes, make tough decisions and enable people to do their job.  They inspire, cajole and lead the team to success.

For me the big danger in Christian Aid's decision is that no fundraising leadership will lead to no fundraising culture in the organisation.

At the crudest level (and with only limited information), it sounds like they have a fundraising and management team who don't actually like fundraising and asking for money!

I wish them well and would love to be proved wrong, but I can't help thinking that this tweet from Adrian Salmon sums up the situation perfectly:

"Ship dispenses with rudder - says crew can steer 'perfectly well with hands'"

I'd love to know your thoughts on Christian Aid's plan...

Fundraising Reading Round-Up

Time for another reading round up.  I've included a couple of excellent round-ups about the Komen controversy in the US this week.  Whilst it's not strictly fundraising related, I think it makes for a fascinating story (regardless of your views) and a case study in how not to react to a negative story about your charity.

Kivi has a great summary, which Nancy then follows up and again here.  This one is going to rumble on for a while I think!

In the fundraising world, there are some good follow up articles to the relationship Fundraising debate on the SOFII Linked In Group.

Ken Burnett responds with his thoughts.

Kimberley shares her thoughts on thanking and shares a lovely story.

Pamela's 10 essentials of an ideal thank you letter.

Why quality is more important than quantity in major donor fundraising.

Mark shares a case study that raised $65,000 in a day.

101 Fundrasing lose and regain a donor.

Alyson on the myth of fundraising panaceas.

The Agitator on beating your control pack.

Paul shares a great Amnesty campaign from Sweden involving interactive billboards and i-pads.

I was delighted to take part in Q&A about fundraising ROI on the Guardian website this week.  You can read the highlights here.

Di Flatt with some thoughts on communication.

Nancy hosts the January non-profit carnival on dreams.

Advice for Good on who gives to charity.

Finally, a couple of articles on customer service.

Seth on caring.

Kev asks if your left hand knows what your right hand is doing and Copyblogger has a case study from customer service favs Zappo's.

Data Insight + Relationship Building = Fundraising Gold

There's been an intense and fiery debate raging over on the SOFII group on Linked In over whether you should send an ask with your thank you letters.

The initial debate widened to a discussion on the merits of relationship fundraising and the need for data analysis - to me the two aren't mutually exclusive, though some people seemed to think so...

Fortunately the rhetoric and mudslinging has died down a bit and some insightful and thoughtful analysis has come out of the discussion.

The consensus seems to be that the best fundraising is a combination of relationship building and data insight. 

Anyway, the discussion has got me thinking how you can represent this graphically and I've come up with the following:

Types of Fundraising
I've put intuition and data insight on one axis and taking a relational or transactional approach to donor care on the other.  By charting how you go about fundraising, you will fit into one of four categories.

I'll give you a quick overview of each one, starting with the worst:

 Bad Fundraising:  Unsurprisingly the worst type of fundraising.  I'd hope there weren't many charities operating here.  This organisation is likely to have an underutilised database, appalling attrition rates and a high turnover of fundraising staff.  Amazingly, some donors will still give to these organisations!

Amateur Fundraising:  I've seen a lot of charities in this space.  They are filled with good intentions and do create meaningful relationships with some donors and are generally well liked.  However, they let mailing dates move, don't have proper processes in place for capturing information and many opportunities slip through the net.  The worst extreme of this is when you get fundraisers who are scared to ask for money.

Churn and Burn Fundraising:  Treating donors as ATM's, constantly asking, using data insight to maximise short term income and the optimum number of 'asks' can be surprisingly effective (especially in the short term).  You 'churn' through your donors as quickly as possible and are constantly looking for new donors.  However, as response rates to cold mailings have decreased and the costs of recruiting donors has increased, this is increasingly hard to pull off.

Relationship Fundraising:  The best of both worlds.  You treat people with respect, listen to them and try to engage them for the long term.  However, you also use data insight to target donors appropriately, have a rigorous approach to testing to maximise your returns and monitor things like lifetime value.  This is the space I want to be and it is the combination that I believe will raise the most money. 

If anyone has any feedback on this or some better names for the segments then I would love to hear from you!