Canadian economist and author William Watson recently commented, in an Ottawa Citizen article entitled The dying-technology charity pitch, on the absurdity of receiving address labels as part of charity direct-mail fundraising appeals. He argued that charities need to get with the times and, more importantly, understand his specific giving behaviour, which as he described, takes place annually regardless of mailed reminders and incentives.
His article provided pertinent advice to charities, and sparked some additional thoughts about how charities should best approach donors during giving season and beyond.
1. It Starts with Knowing Your Donors
Mr. Watson doesn't like receiving address labels and Christmas cards from charities, mainly because he doesn't use them. He gives regardless -- on December 31 every year -- making his annual donation to various charities.
"You’d think by 2014 Canada’s charities ... would have picked up on our fastidious giving habits and understood that all we want in return is a tax receipt, maybe an electronic thank-you and some evidence they’re putting the money to good use."
This is a valid point and expectation. In today's world of big data, predictive analysis and impending drone delivery, charities should know Mr. Watson's giving pattern. There are numerous tools to help organizations track contributor patterns, but many charities simply don't. In fact, most charities don't value data and customization nearly as much as their for-profit brethren.
Resources play a factor, so charities should budget to prioritize tools that help support current donors and acquire new ones. Donor tracking and CRM tools actually do both, so it is quite absurd that charities are not devoting more time, energy and resources to using them.
2. What Donors Say Isn't Always What They Do
Watson's statement about his giving style has a flip-side: often, what donors say and what they do are not the same. In a 2010 survey from Imagine Canada, 84% of Canadians said they gave to a Canadian organization, yet according to CRA data only 23% of Canadians actually claimed charitable donations to registered charities.
Now, even allowing for people who don't claim their charitable donations (which they should) and for those who give informally, there is still quite a gap between what Canadians say they do and what they actually do.
This has also been my experience -- both personally and in the fundraising world. We almost always overstate what we will do when it comes to positive actions like giving, volunteering, helping and sharing because we want to be the kind of person who does those things. We often aspire to do more than we actually do.
The most common refrain I hear from donors is "please don't send me any information." But many people don't give unless they're asked. And without that information, donors don't know where their money went and whether the organization is being effective with their donation. They may end up getting frustrated, feeling cheated and stop supporting the organization because of this lack of information. But what donors really mean is "don't send me crap I don't care about." They do actually want an update on the impact their gift has had. They don't want appeal after appeal after appeal.
So while organizations should respect their donors' wishes, they also need to know what the donors truly want.
3. Sending Address Labels or Christmas Cards Isn't As Outdated As You Might Think
The technical term for the tactic of sending a gift (like Christmas cards or address labels) as part of a fundraising appeal is "reciprocity". It's based on Robert Cialdini's Power of Persuasion and is premised on the idea that when people receive something of benefit, they are more likely to return the favour in the form of a donation.
In fundraising this is often seen in more intangible ways such as universities making appeals to their alumni in hopes they will feel more appreciative (or indebted) and make a donation.
Address labels, coffee mugs, Christmas cards and other inexpensive items are common in the direct mail world of fundraising, and they have been largely successful for decades, so they may not be as inappropriate as you think.
4. Fundraising Does Need to Catch Up (And Use More Common Sense)
Where sending address labels is a bad idea, however, is where Watson points out that very few people under the age of 70 even send letters anymore. As Watson states:
"...the regular deluge of dying-technology pitches into our mailbox is not reassuring."
It's not the gift itself that is necessarily the problem. It's the irrelevance of the gift. I received a magnetic chip clip from a conference three years ago that I use regularly and keep on my fridge when not in use (nice work Network for Good!) That organization has had a place in my home because it is providing value to my life.
A discount claim code for an online retailer, a decent pen or even some branded notepads are all better options if an organization wants to employ the reciprocity strategy because, conceivably, they all provide some value and relevance in people's lives.
5. Fundraisers Need to Ask Why
In addition to not knowing their donors and living in the past, another reason some organizations are sending out address labels is that they think it's a strategy that works.
But my question is this: are these organizations getting donations in spite of sending address labels? Would they still get the donations with simple direct mail? Would the address labels outperform a pen or a personalized thank-you card from a beneficiary of the organization's services?
Fundraisers need to continuously ask why they're using the strategies they're using. Being afraid of change or trying to hold on to what's currently done "because we do it every year" is almost assuredly a strategy that doesn't end well.
Organizations that intentionally ask why and pursue the answer with resources, time and attention will be the ones that do understand their donors and why specific tactics work. And that will help them succeed today, tomorrow and into the future.