Charities cutting costs at the expense of quality marketing are doomed to fail

Despite the seemingly infinite fundraising possibilities charity telethons provide, the majority of brands in the third sector are struggling to maintain their share of the public’s diminishing disposable income.  

Russell Parsons

The most recent published data from the Charities Aid Foundation found donations fell 20 per cent to £9.3bn in fiscal year 2011/12.

Couple this with a reduction in income from central and local government sources and it is inevitable that costs and corners will be cut.

Released today (10 June) a Fundraising Standards Board report provides evidence of the consequences of the drop in funding and income.

The figures make for worrying reading. Complaints against charities soliciting donations on the door step increased by a whopping 93 per cent to 5,555. Of those, of particular ire was the behaviour of fundraisers and the “general dislike” of the method.

Elsewhere, the report found complaints about telephone fundraising increased by an almost as steep 64 per cent and the volume of telephone activity increased 15 per cent.

Damningly, the report slammed widespread “poor data management” by charities, with those logging data protection objections saying they number one tenth of their total. 

There is nothing fundamentally wrong about telemarketing and It is arguable that if handled sensitively door step selling should be allowed to continue. Charities in particular will be given considerable slack by the public if both are used with proper respect for those who wish not to be communicated with by either method.

What the report suggests, however, is that respect is not always forthcoming and that the data management necessary to ensure that prospects and donors are correctly targeted is not being conducted.

Whether this is due to a lack of training or under investment in analytics is difficult to say. What is clear is that the problem needs addressing and it can only be addressed if there is sufficient investment.

Marketing budgets are often the first thing to be trimmed when times are tight. When the budgetary constraints are as grave as those besetting charities even more likely.

It is counter-productive, however, to sacrifice marketing fundamentals in the quest to cut costs. For charities, It can only lead to more complaints, bad feeling and ultimately less money.

There is an absolute need for charities to achieve more with less. But cost-cutting shouldn’t be confused with efficiency.   

The FRSB says charities must “listen carefully to consumer concerns, address the issues and, where relevant, adapt accordingly”. It adds organisations are encouraged to “introduce consumer touch points” and “complaint monitoring”. Valid suggestions, all of which need investment.