Raising funds in hard times

From ANIMAL PEOPLE, June 2008:
Raising money during crises is an area that I have had a
particular interest in since college-not just the impact of the
economy on donations, but also the effects of war, natural
disasters, terrorism and even positive “good feeling” events such
as, for example, the 1969 first human landing on the moon.
Today animal charities are asking, “What impact will the
recession in the United States have on donations?” There is a
prevailing fear that the effects will be considerable. However,
this fear is not well grounded. While recessions have a definite
impact, historically charitable giving, overall, has not declined
during recessions.
Different sectors of donors and potential donors react
differently, and different types of charities are affected
differently.

For example, literally nothing dampens giving to religious
causes. Planned gifts are largely unaffected by such events,
regardless of the type of charity the gifts are directed toward,
because decisions to make such gifts are usually made long before a
crisis occurs. Foundation support has actually quite dramatically
increased during poor economic times. Corporate giving tends to even
out, because giving is tied to profitability, but is usually not
cut back.
Small donors do hold back-but can be effectively persuaded
with the argument that “the animals need our help just as much,
perhaps even more, in difficult times as in good times.” New small
donors are more difficult to acquire but this does not mean one
should not continue prospecting to counterbalance natural file
attrition-it simply means that one should be more vigilant about
costs, by mailing reduced quantities, testing less, or simplifying
packages. Large donors, usually the very wealthy, are not
significantly affected. Changes in tax laws have a far, far greater
impact on these donors.
More than 80% of all charitable giving in the US is by
individuals. Following on this fact, let me quote from one of the
more recent studies: “Since 1968 and measured in constant dollars,
giving has declined in some recession years but increased in others.
The biggest declines tracked the 1973-75 recession, but giving
actually rose in the 1980-82 recession and in the first year of the
1969-70 recession. Further, individual giving has increased every
year in real terms, irrespective of economic times, except in 1987
when dampened by a combination of a stock market collapse and tax
changes.”
The bottom line is we should not be oblivious to the current
economic situation but we should not be overly concerned either. We
should just plan accordingly and understand the historical realities.
The concerns many people have, including me, are real, at
least in terms of personal finance. But frankly, and this has often
caused me to ponder, many non-profits seem to spend more time
dwelling on “reasons” why they don’t think they can raise money than
fashioning ways to overcome the perceived obstacles to raising money:
“Everyone’s giving to the Hurricane Katrina Fund…everyone’s giving
to help tsunami survivors…all the money is being sucked up by the
presidential candidates…the event won’t work because so and so is
holding their event that week too…people won’t give right now
because they are worried about the war in Iraq, paying their
mortgage and the rising costs of food and gasoline…”
The main reason people don’t give is because they aren’t asked to give.
–Paul Seigel
Direct Mail Systems
12450 Autombile Blvd.,
Clearwater, FL 33762
<pauls@direct-mail-systems.com>
<www.dmsmails.com/>

Why fundraising mailings often include merchandise
I like what Humane Society of the U.S. president Wayne
Pacelle writes, but now HSUS is doing something I consider dreadful:
sending gifts and expecting money back.
This just came yesterday: Two 2008 “Members Only” his and
hers watches for support of their 2008 Anti-Cruelty campaign.
Suggested blanks: $150, $225, $300 and Other. I feel like checking
“other” for two cents and telling them how unappealing this kind of
appeal is.
I do UNICEF fundraising at Hallo-ween. When UNICEF began
mailing nickels in appeals, I complained to a friend working there,
and she said that oddly enough these are among their most successful
types of appeal.
So I could be all wrong, but I feel like writing to Wayne
Pacelle and telling him I’m going to deduct money from my annual
contribution. They have a good message without these black digital
watches.
–Ruth Heller
San Rafael, California

Editor’s note:

The new U.S. Postal Service rate structure introduced in May
2008 may discourage the inclusion of unwanted “gift” merchandise in
appeals. Such appeals are reputedly highly profitable if the
merchandise is donated or is purchased very cheaply, but are
believed to bring diminishing returns as the cost of the merchandise
and mailing rise.
The nature of the merchandise mailed also makes a difference.
Calendars remind people to donate. Calculators help them do it.
T-shirts help to promote the image and name recognition value of the
charity. So do coffee mugs. Some other items that have been tried
as premiums don’t work as well.
Supplying merchandise for inclusion in appeals has several
times been involved in alleged kickback schemes involving charities.
In view that mailing merchandise tends to raise donors’ suspicion
that their money is being misused, charities would do well to
clearly identify the cost of the items they send, and the
cost/income ratios they obtained on similar mailings in the past.
Many fundraisers regard such information as a trade secret,
but in view of the potential for abuse of donor trust inherent in
fundraising for charity, this is a field where the only legitimate
trade secret should be the names and addresses of individual donors
who wish for their privacy to be respected.