This weekend has seen another round of charity and fundraising bashing from the national press in the UK. That’s why this week’s Monday Morning Memo from Roy H. Williams  (the Wizard of Ads) was such a welcome read this lunchtime.

As the wizard himself explains…

    Branding – as it is taught today – will at best cause people to remember you and have a mild opinion.

    But unlike yesterday’s branding, today’s bonding is the beginning of relationship, the essence of loyalty and the foundation of     community among human beings.

    Bonding, when done properly, makes people feel connected to you. It is the little-known secret of marketing to millennials and     their parents.

    Bonding creates community – surrogate family – connectedness – relationship – belonging.

    When we talk about “community” in marketing, always remember: We buy what we buy to remind ourselves – and tell the     world around us – who we are.

    “I am irresistible, I say, as I put on my designer fragrance. I am a merchant banker, I say, as I climb out of my BMW. I am a     juvenile lout, I say, as I down a glass of extra strong lager. I am handsome, I say, as I don my Levi’s jeans.” – John Kay

• The personality you craft for your brand is essential to the bonding process.

    The public will give you their time if you offer them entertainment.
    They will give you their money if they feel connected to you.

    In the days of the Old West, branding made a cow yours.
    In today’s hyper-communicated society, bonding makes a customer yours.

As fundraisers, the importance of bonding  and connecting with our donors has never been more important.

Every fundraiser in the UK will be aware of the sustained attack fundraising practices have had from the media, MPs and other commentators.

Whilst some of the criticisms may be legitimate (if overblown) others have been little more than hatchet jobs and extremely damaging to our profession. 

There have been numerous articles in the sector press, blogs etc with people queueing up to give their opinion. What I have been surprised at is the lack of analysis that has been undertaken to understand why the Olive Cooke case has been the catalyst for so much scrutiny and abuse of fundraising. 

Many people have suspected that we had a problem (my epiphany was when my mum started complaining about charities calling her - she never complains!), but we haven't done anything until a sustained media spotlight has been shone on us. 

What I have been surprised at is the lack of data analysis to back up some of the criticisms, solutions and arguments.

Rather than offer more opinion, I wanted to look at the figures to see if they could offer some insight into the problems we are facing as a profession.

First of all we know that individual fundraising income in the UK has seen no real growth for nearly a decade:

Source: UK Giving Report 2014, CAF

What are the implications for this lack of growth? Well, if the market isn't growing, then the only way you can grow is by taking market share from your competitors.

My theory was if that is the case, then the best performing charities would need to be more aggressive in their asking, invest more money into fundraising and this would result in a declining ROI (but increased net income).

That's why I decided to look at the fundraising income of the top 10 charities* since 2010.

This shows that gross and net income has grown considerably, but that ROI has dropped by around seven per cent. 

When you analyse the growth in income and expenditure, then the five year ROI of the increased investment is considerably lower than the overall four to one.

The extra £60m or so spent has returned less than three to one over a four/five year period. Most charities would be relatively pleased with this. 

However, this doesn't give the whole picture as it includes corporate, trusts and legacy income.

Therefore I wanted to look in greater detail at individual giving income. Fortunately six* of the ten charities breakdown income and expenditure of fundraising and have done so since 2010.

This shows that costs are rising more than three and a half times faster than income!

This means that individual giving ROI at these six charities has dropped by 20 per cent over the last five years (from 4.28 to 3.48).

At the same time all 10 charities have spent an additional £60 million (around £10m per charity) over the period. That is a huge number of extra phone calls, street fundraisers, direct mail etc. Especially at a time when inflation has been low.

If we take a look at the increase year on year, you will see there was a huge investment (nearly an extra £18m) into individual giving last year:

Was this the straw that broke the camel's back? Remember, this is just six charities. If the top 100 fundraising organisations* all increased their spending in a similar way over the last five years then that is a huge amount of extra requests to a pool of people who aren't giving any more overall.

A return of 1.63 over five years (though admittedly skewed by 2014 expenditure) is unsustainable in the long run.

So what's the answer? There has been a lot of hot air, but also some good ideas too. 

Here are three of my favourites:

Ken Burnett was ahead of the controversy with his five part 'Future of Fundraising' series.

I've just caught up with Mark Phillips excellent presentation at the Institute of Fundraising National Convention last week.

Finally, Charlie Hulme of Donor Voice was in fine form in this article at UK Fundraising.

We can't keep fighting for the same donors and the same pot of money. The last three months has proved that. Hopefully now we have some figures to help make that argument and develop constructive answers that will strengthen our profession.

Notes:

I used this list at the Guardian of the top 1,000 charities from UK. I worked from the top down, excluding charities who don't do mass individual giving ( the Arts Council) or who receive a significant amount of funds from government sources (Royal Commonwealth Society for the Blind - Sightsavers to you and me)

The 10 were: CRUK, British Red Cross, Save the Children, RNLI, Macmillan, Oxfam, NSPCC, RSPCA, Christian Aid and the RSPB.

All accounts are for 2014 apart from RNLI and Macmillan.

It wasn't possible to work this out for British Red Cross, Macmillan and the RNLI. they breakdown income but not expenditure. Christian Aid are excluded as well as they only started breaking down income and expenditure in 2011.

If someone has the time to look at more annual accounts then it would be fascinating to see the bigger picture.

It's time to share April's Nonprofit Blog Carnival. I'd like to say to a big thank you to everyone who got in touch.  It's definitely a case of quality over quantity, but in the coming weeks there will be great new content on SOFII from the following people - n.b. all links are to the contributor's websites.

Roger Craver from the Agitator is sharing some of his archive and curating a history of social movements in the U.S.A.

Giles Pegram CBE will be revealing some of the secrets behind the NSPCC 'Full Stop' campaign.

Michael Rosen describes how much a good story is worth.

Freelance copywriter Robbie Rae will be contributing a direct mail classic to the 'How I wrote it' series.

Concern Worldwide Ireland working with Open Fundraising shared how they revamped their welcome process for new face to face donors.

Reinier from 101 Fundraising has kindly shared their fantastic archive for future SOFII exhibits.

It's still not too late to contribute an article. So if that has whetted your appetite then do get in touch.

In the meantime check out five of my all time favourite SOFII articles:

All the fab talks from the 'I Wish I'd Thought of That' events over the last three years.

The Jerry Huntsinger tutorials: over 50 articles of wisdom and advice.

Indra Sinha has written some of the most emotionally charged and successful fundraising ads of all time. Read all the about the Bhopal Medical Appeal ads he wrote from 1994 onwards.

Lisa Sargent's 'thank you' letter clinic.

May's carnival is hosted by Erik Andersen from the Donor Dreams Blog. The topic? 'You are the future of philanthropy'. Do get involved.

The end of April is fast approaching, so I wanted to issue one last push for articles for SOFII as part of April's Nonprofit Blog Carnival.

A huge thank you to everyone who has contributed so far. The first two articles are now live on SOFII. You can read about Alex's Lemonade Stand Foundation's award winning, cancer slaying, fundraising target smashing video. Also up is story of DEBRA Ireland's awareness day with a clever hook to get people involved.

As a quick reminder:

The Showcase of Fundraising Innovation and Inspiration (SOFII) is one of my favourite fundraising resources. When I’m stuck with a fundraising problem it is my first point of call for inspiration.

However, it is only as good as the exhibits and articles it showcases. The current archive is amazing, but it only features a fraction of all the innovative and inspiring fundraising work that exists.

That is why I’m dedicating April’s Nonprofit Blog Carnival to gathering new articles and exhibits for SOFII and I need your help…

Get involved and help me gather 100 new articles and exhibits for SOFII.

Don’t be shy. Showcase the most successful fundraising efforts you have been involved in. What made them special? How could they inspire others? What lessons did you learn? 

Not got a blog? It is still easy to take part.

You can download the exhibit form and send your submission direct to me. My e-mail is [email protected]. Alternatively, I’d be delighted to interview you via Skype or telephone.

Not got an exhibit? Why not say ‘thank-you’ to SOFII and make a donation to help pay for the upkeep of the site. Just like Wikipedia and Firefox, SOFII is dependent on the generosity of its users to keep it free and always available for everyone.

On my recent Snowdon trek I was impressed to find these two guys at the summit collecting for the local mountain rescue. Most of the time you are lucky if more than 1 in 100 people put something in your bucket. Here the ratio was more like in 1 in 4.

It reminded me of the importance of making the right ask to people, at the right time. If these guys were collecting in the local supermarket, I would've probably walked by.

The fact I'd just cycled and walked 25k and suffered horrendous cramp meant I was in the right (emotional) frame of mind to give!

Do you have any examples of other charities making a great offer at an appropriate place?

One that sprung to mind was the Canal & River trust asking people to sign up for a regular gift when using a waterway or footpath.

Do share any others you have!

I've just finished reading Jeff Brooks excellent new book The Money-Raising Nonprofit Brand. It's chocked full of great advice, but there was section that led to an epiphany moment for me.

Brooks was talking about the importance of selling the solution and not the process to get to the solution when developing your fundraising offer. It was a real lightbulb moment.  It's something I've been guilty of in the past when trying to develop an offer. As Brooks explains:

“…it’s one of the most elusive things in fundraising: sell the solution, not the process that produces the solution. Someone who wants a cup of coffee wants the morning fog to clear from his head. He doesn’t care about what it takes to move that caffeine from coffee beans growing on a mountainside into his cup and then into his brain.”

He goes on to explain what this means in donor terms:

“To keep your solution in the donor’s realm, you must show the clear connection between the problem and the solution. It must not be the complex process that sets your organisation apart from Brand X Charity, but a simple and obvious connection. Simplicity is everything.

“If the problem is hunger, then the solution should be food. Even if the way you solve the hunger problem is through a complex process of economic empowerment, civil society, training trainers, or whatever it is. I’m not criticising your processes. They’re good, I’m sure. But they are outside the donor’s experience.”

The importance of this was brought home when I watched two recent donor recruitment videos for blind charities. As someone who works at a small blind charity we always look to the larger charities to try and copy learn from their ideas.

The first video is from the RNIB:

The second video is from Guide Dogs:

Which one do you think has the strongest fundraising offer? And which one is selling the solution and which one is selling the process to get to the solution? I think it's pretty clear and I'd put money on the Guide Dogs ad significantly outperforming the RNIB one.

I'm not saying the RNIB one is bad. I think it has some powerful statistics and explains the reality of what it is like to be blind. It just spends more time describing the process to the solution and lacks emotion compared to the Guide Dogs ad. To be honest, it's hard to compete with such a great offer as £1 per week to sponsor a puppy!

I'd love to know your thoughts.

I recently moved house. One of the major hassles of the experience was contacting my bank, utility providers, insurance company etc to update my details.

I had a real mixed bag of experiences from the good to the awful, but what was uniform across the companies I contacted was that within 24 hours of interacting with them I received a phone call, text or e-mail asking me to rate the experience.

These surveys happen all the time because companies know satisfaction is one of the key drivers of loyalty, yet I have never received a similar e-mail, text or call after donating to a charity. 

In fact, in all my research across the sector the only two examples I can find of people doing anything similar is a charity using phone calls to rate face to face fundraisers and in a mystery shopping exercise to rate a phone call. Both examples were done on an ad-hoc basis and I haven't seen any evidence that these scores were then used to measure attrition or lifetime value of donors*. 

At conferences, on blogs and in the sector media we're always told how important thank you letters are (and I believe this to be the case), but we need to do much more to provide the statistically robust evidence that backs these claims up.

If we really want to measure the impact of our thank you letters and service, shouldn't we be making this type of satisfaction survey the norm?

The Agitator and Donor Voice continue to bang the drum for greater insight and understanding of donor's attitudes to increase retention. Learning from the corporate world and starting to measure the giving experience in a consistent and measurable manner might help us to increase our appalling donor retention stats as a sector.

It's only then that we'll truly know the value of a great thank you and donor experience.

*If anyone is doing such feedback measurement, then I would love to learn more and discover how you apply the learning from it. I'm guessing that those organisations doing it are so far of everyone else in terms of retention that they probably want to keep it quiet!

This post is my contribution to the November non-profit blog carnival. This month the carnival is hosted by Pamela Grow and the theme is 'How are you saying thank you?'

Trust in UK charities has taken a battering over the last couple of weeks after a series of damaging articles about the pay of senior executives in large charities*. 

I've had three comments from concerned donors asking where their money goes, so I imagine some of the charities named have had hundreds, and possibly thousands, of questions from donors who are considering stopping their giving.

It's a difficult situation, but the charities that will come out best from the situation are those that have built the trust of their donors.

Trust is something we've been looking at closely in my charity recently and I've been studying Stephen M R Covey's book The Speed of Trust, which looks at how individuals and organisations build (and lose) trust.

According to Covey, there are four cores that are essential to gaining trust:

1. Integrity
2. Intent
3. Capabilities
4. Results

So how do these apply to fundraisers?

Integrity

How transparent and honest are you in your dealings with donors? Do you 'walk the talk' and act in accordance to the values and beliefs you and your organisation set? Do you report back honestly to donors and are they clear what you stand for as an organisation?

Intent

Are your motives straightforward and based on mutual benefit? For example, how many of your 'thank you' interactions with donors are actually asks for further money? Does your behaviour betray your intent? For example, nearly all charities say they respect their donors and listen to them (the right intent) but often the behaviour, such as wrongly addressed mail, ignoring requests etc undermines this.

Capabilities

These are the abilities you have that inspire confidence - your talents, attitudes, skills, knowledge, and style. You use these to produce results. For example, are you constantly looking to improve and learn as a fundraiser?

Results

This is the track record of you as a fundraiser and your organisation. Do you feedback to donors on what their gifts have achieved?  It's no good having the relevant integrity, intent and capability if you don't make a difference.

Trust is much easier to lose than gain and I'd highly recommend the book if you are interested in learning more. In the near future, I'll look at the thirteen behaviours that Covey identifies as building trust.

*For a great summary of the recent controversy I recommend this article by Becky Slack.

I'm the proud host of July's nonprofit blog carnival and this month we are looking at regular giving.

Monthly giving is the backbone of many individual giving programmes, but it can be hard to get right, especially in small charities . This month we'll be looking at how to acquire monthly givers, how to welcome them to your nonprofit and then how to look after them so they keep giving for many years.

Acquiring monthly givers and general advice

The main sources of recruiting monthly givers include:

• Street fundraising
• Door to door fundraising
• Direct response television
• Direct mail
• Panels on trains and in washrooms
• Asking your current supporters to sign up

The effectiveness and popularity of each method depends on where you are in the world and the budget you have available.

As acquisition becomes increasingly expensive it is important that fundraisers think creatively about recruiting new donors.

Pamela Grow shares advice on how to start up a monthly giving programme.

A Small Change on setting expectations for your programmes.

The Fundraising Authority with seven steps to launching a monthly giving program at your nonprofit.

Joanne Fritz at About.com posts eight tips for keeping monthly giving simple.

Kunye Consulting with a view on regular giving from South Africa.

SOFII has a wealth of examples of great monthly giving campaigns and products. Here are a few of my favourites:

• Dogs Trust sponsor a puppy product.
• The story of the origins of street fundraising by Greenpeace.
• Save the Children's Gaza campaign - used SMS and then telephone to convert to monthly giving.

Welcome and thank you

Depending on the type of recruitment you use for regular givers, attrition can be up to 65 per cent in year one. That's why it is so important that you do everything you can to welcome your new donors and make them feel appreciated.

Read how WRVS reduced their first gift attrition by 40% by sending a simple, heartfelt and personalised postcard.

101 Fundraising on calculating retention and building a retention and development strategy.

mGive share how you can use mobile and text giving to build a regular giving community.

Stewardship

Once you've welcomed and thanked your donors, you need to think how you are going to build your communications programme to inspire your donors and make them glad they gave.

Stuart Glen shares a lovely story about how he received a personal thank you for his monthly gift to Child's i.

Over at Pamela Grow's blog, Lisa Sargent shares some thoughts on the importance of on-going communication with your regular donors and getting your back end systems working correctly.

The Clarification blog share seven ways to build rapport with your donors using creative thank you's.

The Nonprofit Consultant blog on how your regular givers are changing.

August's nonprofit blog carnival

Kivi Leroux Miller at Nonprofit Marketing Guide is hosting next month's carnival and the topic is "playing nice with others" so you can get more work done, and done effectively, in a nonprofit environment.

Thanks for reading July's carnival - do get in touch if you have any questions or comments.

P.S. You can become a "Friend of the Carnival" and sign up for regular updates from Joanne Fritz, the nonprofit guide at About.com and manager of the carnival.

Today is the start of the annual Institute of Fundraising Convention. If you are going along, then do come and say hello - it would be lovely to meet you.

As I've been working on my presentations over the weekend, it means I'm a bit late with the reading round-up. Sorry for the delay!

The Fundraising Collective on Impossibly Monstrous Projects.

Barbara Talisman: Donors don't have to give anything.

Are you adding to your donor's 'experience CV'? asks Amanda.

Charlie on how to make your story stand out.

Stuart Glen joins the blogging scence and shares his thoughts on in-memory giving.

Tom Peters goes from outraged to open minded about the use of big data.

Copyblogger looks at the evolution of permission marketing.

Fututre Fundraising Now with nine ways to be an antil-donor fundraiser.

Veritus Group share 26 conversation tips.

Kivi wants to know if your nonprofit is ready to be super relevant?

Why screaming goats and random cats matter. Conor Byrne gives his opinion.

20 symptoms of fundraising trouble by Reinier at 101 Fundraisin.

This list of fundraising ideas that Change Fundraising will never do made me smile.

Paul shares some bits and bobs about mobile.

Charity Chicks reflect upon Once Upon I Wish I'd Thought Of That.

Do you know your failure rate asks the Agitators?

The best fundraising offer that Agents of Good never got.

Beth wants to know if you are a giver, taker, or matcher?

Karen Zapp: Ignoring Supporters. Donors and members retaliate.