THINK TANK: Charities - The art of giving

The charity sector is well known for relying on tried-and-tested ways of bringing in donations. But now marketers are thinking more long-term.

When it comes to eliciting a response, charities are the grand masters of the marketing world. They're familiar with every trick in the book, from free pens included with 'hand-written' letters written on intentionally cheap paper, to ambushing people on the street, clip-board and direct debit form in hand.

These sort of techniques, many of which were perfected in the States and imported to the UK, fulfil an urgent and unrelenting need - to amass much-needed funds through donations. And because charities aren't offering an exchange in the usual sense of the word, but rather the more nebulous sense of 'doing good', it's little wonder they have perfected many of these methods.

But is this approach really the future of charity fundraising? Just as the scramble for customers in the consumer sector is being re-examined in favour of a more intelligent model that looks at value and retention, shouldn't the charity community also be re-appraising their marketing approach?

This month's Think Tank panel - who have more than 70 years in charity fundraising between them - was divided over the validity of techniques such as the ubiquitous 'free pen' mailer. James Kilffen, head of fundraising at Medecin Sans Frontiers (MSF), is clear in his response. "It's a technique that could apply to any charity and therein lies the problem for me - it doesn't add anything," he says. "Ask anybody who donates to a charity why they give and it won't involve free pens."

It's a sentiment echoed by Marc Nohr, managing partner of Kitcatt Nohr Alexander Shaw, which works for charities including VSO, the NSPCC and WSPA (World Society for the Protection of Animals). However, he worked on the first charity mailpack in the UK to incorporate a pen six years ago and defends the approach taken at the time.

"It was a campaign for Amnesty International and the case history was of a boy who had his eye gouged out by a pen," he explains. "We were trying to relate a difficult story, saying feel this with your thumb and imagine what destruction could be wrought. To encourage a response, we asked people to use the pen to help change the world."

But Nohr is the first to admit that while the pen had relevance and helped communicate the message in this example, it has increasingly been abused as a response device and lost its potency. He blames the "lemming phenomenon" - something that is prevalent in the charity market.

"Charities are incredibly open about what works, and because everyone is trying to minimise risk and use their resources wisely, they observe what's working and replicate it," he adds.

This willingness to share information is both a positive and a negative.

For Kilffen, it's one of the advantages of the sector. "People ask me if I'm worried someone is going to steal our secrets, but my response is that we're all struggling to get the basics right and anything we can do to help each other is good. At the end of the day, we're all competing for disposable income. I'd say that our competition is the local restaurant or cinema, so I'm not worried about competition from other charities."

Long-term strategy

But when sharing leads to wholesale replication, which ultimately dilutes effectiveness, there has to be cause for concern. However, everyone around the table agreed that there was a much bigger issue at stake when it comes to fundraising gimmicks.

"It's not 'do these gimmicks work?', to which most people will say 'well, yes they do', but you have to start asking on what criteria they work. That's the crunch," says Stephen Pidgeon, chairman of charity specialist Target Direct.

Much like the '0% APR' offer for credit card companies or the '10 issues for the price of five' subscriptions offer, the issue is not the effectiveness of the mechanic used, but the long-term impact of that strategy in terms of the type of customers acquired and their lifetime value (LTV). And this is a whole new metric that the charity sector - much like the commercial sector - is starting to wake up to.

"What you have, to crudely characterise it, is the Old Testament and the New Testament," says Nohr. "The Old Testament says technique is king. Put as many offers and splashes in because ROI is the only metric that matters. In the New Testament you've got a new generation of thinking that says it's not about short term, it's about long term. ROI becomes LTV, the brand becomes important and you need qualitative measures as well as quantitative."

It's a shift in mindset that both the charities represented around the table - MSF and ActionAid - are praised for embracing more readily than others. "In the very first campaign I did when I was at MSF, I used every single trick I'd learnt and proudly showed everyone in the office the cheques as they came in saying, 'look it works'. It took me a long time to realise that I was missing the point," admits Kilffen.

New donor types

Now the focus is on a much 'softer sell', but one that establishes a clear brand narrative and strives to develop a long-term affinity between charity and giver. As an example of this, Kilffen points to a DRTV campaign to raise funds for Sudan that MSF ran in 1998. Everyone who responded was sent a newsletter for the best part of two years telling them what was going on in the field but with no explicit fundraising message.

"When we did phone them up, the results were off the scale," he says. "We'd spent two years telling them about who we were and what we did, drawing them closer and closer."

Annette Kelly, senior partner at John Watson Partnership, adds that this type of donor, who has genuinely bought into the values of an organisation, is exactly what many charities are now after. "It's the much more passionate, rational response from someone who's likely to give a stronger commitment for a longer time," says Kelly.

But she adds that acquiring this type of donor requires a different approach and one that can be at odds with the objectives fundraisers are set. "In an awful lot of organisations, charity marketers are motivated to succeed by the number of donors they get or the percentage upgrade they achieve as opposed to actually communicating the brand to the right people and in the right way."

Another obstacle is what Kelly describes as the "disconnect" between the fundraisers and the people setting the policies. This isn't helped by the fact that they're rarely represented at the top table.

"If fundraisers are the frontline of the mission, which is to get the funds, they have to be at the top table," she says. "Unfortunately, often the decisions come from elsewhere and feed down."

At ActionAid, there's total integration of the brand and donor activity, but this can be a challenge, says international marketing director Lyndall Stein. "In terms of child sponsorship, we would now never talk about issues at a community level without talking about HIV and Aids, but this wasn't always the case," she says. "Research had shown that sponsorship donors weren't interested in Aids so we'd run it separately. But the work must engage the mission, and HIV and Aids is one of the biggest issues we're dealing with. So never mind that it's difficult and often messy and complicated - you have a moral imperative to tell donors about it."

Brand message

But preoccupation with the brand and ensuring that all fundraising activity is 'on brand' can cause its problems, as Pidgeon has discovered. "Three of the charities we're working with are talking about their brand proposition and working with their above-the-line agencies to come up with missions and values," he says. "But when it comes to organising a local charity abseil, what are we asking people to support? What's the fundraising proposition, because that's what the charity has to stand for."

Kilffen agrees that applying brand marketing techniques to big charities can make life harder for those at the fundraising coal face. "What happens is that everyone has an input into how the charity is going to be portrayed as a brand and you end up with five key messages that have to be put into every communication. It can become impossible."

Not only that but strict adherence to brand guidelines can stifle creativity - another area where many charities are thought to be lacking, perhaps in part because of the tendency to imitate rather than break new ground.

Nowhere is this more apparent than in face-to-face marketing, which has now become commoditised, believes Nohr.

"When Greenpeace introduced face-to-face marketing to this country, it was cool. They had their Greenpeace jackets and it was right for the brand because it was a campaigning brand. Then every other charity recruited students to come up to you on the streets and hassle you and it becomes the height of irritation. It's back to the commoditisation of any medium. There's a real lack of creativity."

MSF has recently stepped away from face-to-face marketing activity altogether because of the high annoyance factor. "I see it as alienating too many people," says Kilffen. "When I go to parties and say I work in fundraising, people start having a go at me."

So far there's been plenty of talk about what charities shouldn't be doing. As for what they should be doing, Nohr sums it up as "moving from a transactional view of the customer to an attitudinal one" but admits that this is no easy process.

"If you have two donors and one has given once and the other twice, does that mean the second donor is twice as valuable as the first? The first could be a potential legator or could have had a tough year but next year is going to give you £150. Getting close to that sort of customer intelligence is the next wave of direct marketing. That's the outstanding challenge this sector faces."

And if charities - whose dependence on donor support is literally their life blood - can't get to grips with it, there has to be little hope for the rest of the marketing fraternity.

THE PANELIST LINE UP

JAMES KILFFEN, head of fundraising, Medecin Sans Frontiers (MSF)

Kilffen joined MSF UK in 1996 and was the charity's first head of fundraising. He has also managed fundraising for the Disasters Emergency Committee, which coordinates the fundraising response of UK aid agencies to major disasters. Prior to joining MSF, Kilffen was appeals manager for the British Red Cross. He started his charity involvement in 1991 by organising what was the UK's largest direct response TV campaign to date for Comic Relief.

LYNDALL STEIN, international marketing director, ActionAid

Stein has spent 18 years in fundraising and communications for organisations such as the Africa National Congress before the end of apartheid, the Terrence Higgins Trust and The Big Issue. As well as her role at ActionAid, she is a Trustee of the National Aids Manual, the international information provider on HIV.

MARC NOHR, managing partner, Kitcatt Nohr Alexander Shaw

A former creative director, Nohr has worked on dozens of charity campaigns. He launched Kitcatt Nohr in January last year and was previously managing director of agency Lion.

STEPHEN PIDGEON, chairman, Target Direct

Pidgeon set up Cheltenham-based DM agency Results in 1987 and in 1989 was charged with launching the fundraising unit at Brann. In 1993 he launched Target Direct, which works with charity clients including The Salvation Army, Help the Aged and Christian Aid.

ANNETTE KELLY, senior partner, John Watson Partnership (JWP)

Kelly started her career in the US, coming to the UK in 1989 to join the WWAV Rapp Collins Group as managing director of HLB. She joined JWP last year and is also a non-executive director of the Direct Marketing Authority.

THINK TANK: WE'D LIKE TO HEAR FROM YOU

We are interested in hearing your ideas for issues to discuss in Think Tank. If there is a subject you think deserves an airing, please contact Holly Acland, editor, Marketing Direct, 174 Hammersmith Road, London W6 7JP. Tel 020 8267 4234 Fax 020 8267 4192. Email: holly.acland@haynet.com.