We recently noted the latest Pew Internet Research findings on US online habits across various generations.
Here’s the main point: “In what they term the ‘biggest online trend’ Pew reports that certain key internet activities — including donating — are becoming more uniformly popular across all age groups.”
Bonnie Catena of Amnesty USA offered this comment, which I thought deserved your attention …
“All great food for thought as we continue to wade through the plethora of media options we fundraisers have for donor communication, stewardship and solicitation. I’m compelled to note, however, that the vast majority of individual donor income for most non-profits is raised through the mail. (At Amnesty, 11% of our income is Web-sourced. The rest is direct mail, telemarketing and sustainer.) Let’s keep that in mind as we fend off our Boards and Executive Directors who don’t understand why our direct mail budgets haven’t markedly decreased. They will when the mail stops working!”
Amen.
Roger said we’d be talking more about misguided boards! Actually ‘woefully ignorant’ was the term he used, not referring to any particular group. We read Bonnie’s comment as a generalized lament … how many of you would agree with her sentiment?
Tom
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I totally agree. If anything, costs of fundraising and pressures on fundraisers are increasing in line with the need to investment in an online presence, training and skill development. Not only do they need to be expert direct mail managers, they now have to be social media experts, online useability experts and content queens and web architects etc etc
The challenge is in knowing when the mail program for your organization will decline… and it probably will.
Let’s assume that the response rate amongst direct mail demographic remains (mostly) the same forever more. As Boomers pass away, they will be replaced with the much smaller GenX generation. Unless GenX’ers drastically increase their DM response rate, DM revenues will fall. If the response rate remains consistent, then it should pick up again, when the larger numbers of GenY begin to reach the “DM response age”.
And this assumes that all future generations will respond to Direct Mail in the same way as previous generations. That’s certainly possible, but as a GenX’er whose friends are also GenX – I think it’s unlikely.
The question for me becomes… how do we keep our board members investing in Direct Mail so we can continue to maximize our revenues in that area, while also encouraging investment and experimentation in online/digital fundraising.
If and when DM revenues begin to dwindle (and I think they will some day), it behooves us to ensure that we have the skills and expertise to keep the good works of our charities well funded. We can’t give up on Direct Mail, but we also can’t give up on exploring and testing new revenue opportunities.
You’re right on. I can’t tell you how many nonprofits I’ve had to tell: “I wish all donors would give to digital campaigns so we wouldn’t have to kill trees, waste paper and spend money on postage. But wishin’ don’t make it so. You need all channels working together if you want to maximize revenue.”
With declining direct mail response rates, I especially encourage you to include in your reporting all online donations that came in during the period a donor was receving the direct mail.
After more than a decade of steady — and often heady — growth in online income many nonprofits are now starting to see online channels contributing truly significant portions of their overall income. It’s obviously an exciting growth area and 2010 numbers for groups with active, strategic, and multi-faceted online programs tended to blow even optimistic projections out of the water. There were many “wow!” moments as we logged on to see final year-end results in the wee hours of 1/1/11.
But nothing quite beat the cheer that went up here after we got the call from a large social service mailer that a $25,000 check arrived in a BRE. It turns out a very elderly gentleman had received a cold acquisition appeal and was moved to make a five figure gift through traditional direct mail. (Best of all, the check didn’t even bounce!
It’s a complicated world out there for fundraisers. Traditional direct mail costs more and raises less than it used to. There’s no doubt about it. But offline, online, social media, mobile, multi-channel — it’s all important. It all has its place. And it’s often a different mix that works depending on the type of organization. I hope that Boards do their job: Looks at the numbers, evaluate results, but most of hire CEO’s and fundraising staff that they trust … and then listen to the experts.
On the personal level, I’m with Harry Lynch on this one.
Every nonprofit’s situation is unique and specific unto itself, so predictive behaviors and outcomes across the entire nonprofit sector are extremely difficult at best. That said, it does, in fact, make total sense to utilize every available communication/cultivation/solicitation channel in a mix that makes sense and is practicable for a particular organization.
So, is there a bright future for online/digital methodologies in nonprofit advancement? You bet! But, as with all other methodologies, online/digital is no panacea. It has its own built-in limitations.
Although time likely will change most practices in philanthropy and the direct-mail methodology (as it does in ALL other things), we’re still living in a world in which so many of the people with the “big bucks” do NOT use computers and are not literate in online/digital giving methods. And, in many cases, they could not care less!
Where trees, environmental waste and the other relevant, unintended-results issues are concerned, just think, for a moment, about the fact that the direct-marketing industry has barely even touched the surface of alternatives to traditional materials for in-your-mailbox messaging.
All of this is reason enough to believe that direct-mail solicitation, like our sun, has a way to go before it burns itself out. Meanwhile, like Harry Lynch, I’m celebrating with clients that open BREs containing five- and even six-figure gifts on a daily basis. Right on!
Thanks, Tom, Roger, Harry, and Raymond!
Rich food for thought for this relative-newcomer with only a few year’s worth of data under my belt!