Give generously

Charities are having difficulty recruiting new donors. With giving at a 20-year low, they are being forced to come up with new methods to persuade young people to open their wallets.

Anyone who works near a city centre cannot have missed the recent appearance of an army of young people dressed in bibs and clutching clipboards. In all weathers they stand there, politely asking passers-by if they could spare a few minutes for the particular charity they represent.

One could argue that the feeling of guilt induced by ignoring a friendly face asking if you could spare a few minutes for Save the Children is not the best way to strike up a relationship with a potential donor. However, the fact that these people are multiplying at an alarming rate is proof that the method is working.

It is largely charities, so far, which have made the most of this face-to-face marketing discipline. But charities are finding themselves in a tricky position. Donations are at their lowest for 20 years. This is not helped by the fact that there are almost 200,000 registered charities in this country. The numbers just don’t add up.

The main method of donor recruitment and retention has always been direct mail, and with very good reason. The most lucrative donor market is the over-60s, who respond best to direct mail.

But with increasing competition, there is a recognition that relying on the older population for donations is not a good long-term strategy.

Last year, more than 90 million pieces of charity direct mail were delivered to homes in the UK. But response rates to charity direct marketing generally are falling. Charities and their agencies are having to think harder about how to squeeze more money out of a shrinking, and some say compassion-fatigued, group of people.

Out with the old

One of the reasons why charities are using the face-to-face technique is to try recruit younger donors. Sarah Edwards, group account director at direct marketing consultancy DMS, admits that most charities’ databases are largely made up of older people. “They die – and so just maintaining donor levels is a battle,” she says.

But what of this younger generation? As each generation grows up with different influences, can current and future generations be relied upon to be civic-minded and inclined to give regularly to charity at all? And it is the regularity of giving that is the issue. Those friendly people in bright bibs are persuading whoever they can to sign up to a direct debit.

But although the idea of the face-to-face brigade is to capture a younger audience, Paul Seligman, managing director of promotional consultancy 141, which does work for the National Canine Defence League, wonders how keen young people are to commit to direct debits: “Young people don’t necessarily have bank accounts, and they are generally quite scared of direct debits.”

He adds: “Charities are having real problems recruiting younger donors because the current generation are the children of the Thatcher years, which emphasised individualism and a degree of selfishness. Those people aged 18 to 25 are into alcohol, sex, fashion and music. That’s what they spend their money on.”

Jaded youth

There is a degree of cynicism among younger people that may not have been an issue a few generations ago. Edwards says: “Charities have to work much harder to demonstrate value for money. They must demonstrate that 95p in the pound is going to the cause. Giving has become much less altruistic and people almost want a sound business reason for giving someone money.”

Whether or not one has any faith in the generosity of younger people, what is clear is that they don’t respond to direct mail. It’s not how they want to be communicated with.

HLB director of list broking services Suzanne Lewis comments: “The problem with many charities is that they treat younger people in the same way as they treat older people.”

Who are these people?

Another reason why targeting younger people is more difficult, according to Lewis, is that lists for this sector are just not available.

Lewis says HLB has done work for charities “where it has driven down the average age of donors to between 30 and 40, which is young in charity terms”.

And this is probably as young as the regular donor base is ever going to be – particularly if driven through direct mail.

The Marketing Store (TMS) deputy managing director Tony Barton believes young people are not uninterested in giving to charity – it is just that they are not being communicated to in the relevant way.

TMS developed a campaign earlier this year for World Vision’s Orange-a-peel to supplement the charity’s annual fundraising campaign. Apart from existing donors, who were targeted through direct mail, TMS targeted a younger audience, largely through a TV campaign on MTV as well as an interactive website with online registration and payment and online postcards.

Fear of the phone

When TMS was researching the direct response TV (DRTV) campaign, which initially had a large telephone number and a small website address in the final frame, 75 per cent of the children researched (the prime audience being 14-year-old girls) said they would rather respond to the website than via the phone.

“These kids may all have mobile phones and be text messaging each other all the time, but it’s completely different asking them to call a strange adult,” says Barton.

Charities also need to understand the inevitable shift in the nature of the relationship that people want with charities. Although older people may be content to give away a set amount of money to the same set of charities each month, younger audiences tend to be more reactive – again posing problems for charities trying to ensure consistent and regular giving.

HLB’s Lewis says: “The amount of regular disposable income that young people have is limited – particularly those who are having to pay off university loans. Young people may not give on a regular basis, but they are far more likely to give time to a particular project or organise a short-term project with their peer group. We have to be able to treat people as they want to be treated.”

Corporate responsibility

The decline in direct marketing response may yet provide an opportunity to charities which are tired of slogging away trying to squeeze money out of the same donor bases and a limited number of lists.

Andy Annett, managing partner at marketing services agency Liquid Communications, says: “I feel the decline in response to direct mail by individual donors reflects a far wider picture which could be advantageous to charities. In a corporate world that is becoming more caring, the opportunities for companies and brands to donate directly to a charity are increasing. I think that corporate or brand giving will largely replace direct individual charity donations.

“Why spend a vast amount on a list-based mass mailing with a tiny percentage response rate when you could channel your energies via brands and corporations which will not only guarantee a basic income but communicate with their customers on your behalf?”

Growing up

Of course, assuming that younger generations are never likely to respond to direct mail, even when they reach middle age, could be far wide of the mark.

Lewis says: “Who knows how these people will respond to direct mail in the future? I think it will be much easier for people to ignore an e-mail than a direct mail pack.”

Seligman also believes that what may seem like a fairly selfish generation now may well change. “It is not unsafe to assume that as people get older, they become more aware of their frailties. And as they are more exposed to illness, even in their own families, it does heighten awareness and change attitudes,” he says.

The direct marketing industry doesn’t seem to be panicking about any decline in direct mail response – probably because it is still responsible for budgets that include DRTV, which is increasingly becoming a donor recruitment tool. It would also be too depressing to accept that future generations are unlikely to care about charitable giving. As Barton at TMS says: “It has nothing to do with an underlying problem of selfishness in young people – it’s just a matter of marketers having to get smarter.”

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