Think of a typical charity mailpack and the image that normally comes to mind is an envelope containing a pen, or an inexpensive-looking letter full of emotion-wrought images explaining the cause and asking for money.
But direct marketing techniques have moved on apace. With channels such as email, viral and SMS commonly used by many sectors, there is still a feeling that the charity sector is failing to make the most of the opportunities these channels present. With charity giving also falling victim to other forms of giving, such as the National Lottery, the popular view is that charities need to work harder. Between 1995 and 2002, participation of adults giving direct to charities fell from 68.5 per cent to 67.3 per cent, according to the National Council for Voluntary Organisations.
And a recent survey by The Guardian of the income of 42 top charities showed that only 10 per cent of that income came from mail.
Slow change
The fact charities seem so slow to change is a great source of frustration for this month's Think Tank panellists.
"Charities can be extremely conservative - they embrace technology to a degree but there's a lack of understanding about how it might be applied," says Nick Platt, creative partner at WWAV Rapp Collins.
There's a feeling around the table that charities all too often prefer to stick to what they know. Part of this reticence is their desire not to alienate their donor base by seeming to spend too much on marketing costs. This is something that frustrates Alan Timothy, chief executive of data engineering consultancy Rocket Science, who feels charities too often concentrate on the wrong area: "They're looking at how much the envelope costs rather than what it will give back, so they can say they're cost-effective."
This is where Matt Goody, head of direct marketing at Shelter, chips in. He is trialling the use of banner ads and search engine optimisation, targeting property websites and search engines, so that when 'property' is searched for, a link for its website also appears. However, he says there are still problems: "There are practical issues. Even if we do a phenomenal amount of advertising through online activity, it isn't going to generate the kind of response rates we're getting elsewhere."
This is a common problem and prompts the question of what the make-up is of the typical charity donor base - and whether digital channels are relevant for communicating with these audiences. "The majority of donors for many charities are 55+ women and for a lot of that group, email and SMS won't be a primary way of communicating for them," says Nick Gillett, co-founder of digital agency C360.
However, with charity clients of his own, he is quick to add that no one is advocating a total swap from traditional channels to new ones.
"It's about extending the appeal of your audience. You know you're already very good with the over-55s, but we're trying to encourage people to think about how to get younger audiences involved."
And using channels that younger audiences already rely on, such as email and SMS, is one way of doing this. "A lot of people recruited through face-to-face have lapsed. They're the kind of people for whom online would have been an ideal way of keeping them interested," says Scott Logie, managing director of data specialist Occam.
Multi-channel challenge
But using multiple channels requires cohesion and just how good charities are at making the channels they use work together is a moot point around the table. Logie believes one problem is a lack of communication between departments: "The people who do the online stuff aren't necessarily the same people who run mail or face-to-face activity, and they aren't bringing their information together afterwards or even talking about it before."
Charities' databases seem to be part of the problem. Through a project to improve its own database, Heart Research national director Barbara Harpham spoke to several big charities and discovered that few were happy with their databases: "Ease of use was the main problem. What they were told it would do and what it actually does are two different things."
For some, however, things are getting better. The subject of legacies comes up - a mainstay of many charities' funds, but a sensitive subject to communicate through direct marketing. Those around the table have seen the value of legacies drop in recent years, conversely while charities are getting left more of them, which means they are having to be a little more adventurous in finding new ways of encouraging people to pledge.
WWAV Rapp Collins recently created a TV campaign for one of its clients on this subject. "Society has changed, with people leaving less in legacies, so the idea was to grow the market," says Platt. "We said, 'this is an important thing you can do; think about it'."
Attrition issue
The oft-maligned face-to-face approach also comes in here. Castigated for high attrition rates, some charities, such as Shelter, are using it to great success. "Nearly 90 per cent of our recruitment is through face-to-face," says Goody. "Well over half our regular givers are from face-to-face and despite the attrition rate, it's still very cost-effective."
Yet for many, attrition is too great for it to be a worthwhile channel.
The cause of this is largely in the way the payment model is structured, say this month's delegates. The more donors the agencies recruit, the more money they get, and the younger the audience, the more likely they are to sign up. But conversely, they are more likely to lapse or never even make the first payment.
This is a problem Shelter is trying to address. "At the moment we pay agencies to recruit people by signing them up onto a direct debit form, and we're increasingly recruiting very young donors - 18 to 20-year-olds," says Goody. "Now we're proposing paying them more for donors over-21."
Not only is choosing the right method of recruitment vital in ensuring a charity has a database full of valuable donors, but what has also become increasingly important, according to our panellists, is giving donors a choice of communication channels.
"With a recent TV ad we did for a client, just the addition of a URL increased the level of people giving," says Platt. "It's the speed of access."
"It's also ease of use," adds Gillett. "We did a campaign for the RSPCA to ban fox-hunting. At the bottom of the press ads we put in a shortcode plus a URL, and tens of thousands more came in by SMS. It's about making it easier for the consumer to respond."
He believes the more channels charities open up, the more people will come and talk to them. But there's also a feeling that charities are failing to take enough notice of who the donors on their database are and what they want from a charity - seeing them as just a name and address, and so not targeting them in the most appropriate way.
This causes a number of problems; not only missed opportunities for getting more out of the donor base, but in terms of ensuring both charity and donor base understand each other.
"Do you have your dataset planned into individual life journeys with expected ROIs?" asks Timothy. "There's nothing wrong with recruiting people on the streets. The problem comes when the name's been captured - how are you going to engage them?"
Feel-good factor
Those around the table are well aware of the importance of engaging donors to make them feel valued and informed, but crucially, also as if they are really doing something to help.
"It's more about keeping the consumer in touch with why they're giving you money in the first place," says Gillett. "For the consumer this sends out two messages: that the money's going to the right place and it makes them feel good about themselves."
This feel-good factor should not be underestimated. "People want something back for what they give," says Logie. "It's why things such as the Dogs Trust 'sponsor a dog' works so well because they get a card from their dog."
The question of whether charities are adapting their messages to reach different segments is thrown into the discussion, and the answer is that some are, albeit in different ways. While Heart Research does alter its message to fit the audience, other charities use other means of getting people involved.
"Lots of charities have catalogues or get people to run a marathon or have shops, all of which get people involved in different ways," says Goody.
It's crucial to understand just what your target audience feels about you and what their perception of your charity is. While it's important that people understand what it does, whether a charity should develop a 'brand' is up for debate. "Because there are so many negative connotations with brand, you can fall into the trap of thinking more about that than what you actually do," warns Platt.
Everyone around the table agrees engaging the consumer is vital. "You have to not make them feel like a cash cow," says Harpham. "Say 'we like your money and this is what we're doing with it'."
There is a consensus at this point that it doesn't matter how a charity does this, but that it will fuel the valuable relationship between it and the donor and reduce attrition. Perhaps surprisingly for a sector that relies on donations, there is agreement that it doesn't have to be about money, at least not in first instance.
"It's about engaging with a cause first," says Platt. "Once I know that you're a friend, perhaps asking for money is a simpler task."
This seems to be the case for both the charities around the table and some of the clients of the other panellists. While a Christian charity that Occam works for recruits people to pray for causes, C360 works with the RSPCA purely to get people to sign up to petitions.
And this is what it keeps on coming back to: for charity to do well, it has to first engage consumers and make it easy to communicate by giving them the means of doing so through whichever channel they prefer. The best example of this? Again, the Dog's Trust 'sponsor a dog' programme comes up. "It's the best programme I've seen," says Logie. "It uses all channels, its online recruitment is fantastic, and it gets results every time."
You can't say fairer than that.
THE PANELLIST LINE UP
Nick Gillett, co-founder, C360
Before co-founding digital specialist agency C360, Gillett worked for agencies in mobile and online advertising. Prior to that, he was launch ad manager for Guardian Unlimited and its specialist sites.
Matt Goody, head of direct marketing, Shelter
Goody joined Shelter as head of direct marketing four years ago. Prior to that, he was head of client services at telemarketing agency NTT Fundraising, and direct marketing manager at ActionAid.
Barbara Harpham, national director, Heart Research
Harpham worked for one of the UK's largest voluntary organisations at local, regional and national level for more than 20 years before joining Heart Research in January this year.
Nick Platt, creative partner, WWAV Rapp Collins
Platt joined WWAV Rapp Collins after running his own integrated agency Alphabet. Prior to this, he worked at Saatchi & Saatchi, TBWA GGT Direct, BHWG and DP&A.
Alan Timothy, chief executive, Rocket Science
Timothy has run several companies during his 20-year career, including Targetbase Marketing. At Rocket Science, he provides organisations with data analytics using simple but effective data frameworks.
Scott Logie, managing director, Occam
Before joining Occam in April 2001, Logie was head of research, data and analysis for Bank of Scotland. Since joining Occam, he has worked with a number of clients including World Vision, Dog's Trust and Sainsbury's Bank to help them develop their data strategy.
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