The Coming Charity Crisis

From: Newsweek

How the struggling economy is hurting donations.

The latest victims of the sagging economy: charities. In May the annual gala of the Robin Hood Foundation, an event at which a few thousand hedge fund magnates and leveraged buyout titans conspicuously display their wealth and commitment to social justice while rocking out to A-list musical guests (Shakira, John Legend, Sheryl Crow), raised $56.5 million, down 21.5 percent from $72 million the year before. (Tom Wolfe profiled the 2006 gala in Portfolio.) No surprise here. Many of the regulars have seen their net worths crushed in the past year.

But it’s not just the charities of the swank that are suffering. The Salvation Army caters to a somewhat different crowd—i.e., tens of millions of middle-class Americans. And while it had a good Christmas, “since the first of the year, we’ve seen some slippage,” says Maj. George Hood, a Salvation Army spokesman. Overall donations are down compared with 2007, and donations of used clothing and furniture to thrift shops have fallen by 20 percent. While natural disasters typically inspire a spike in donations, Hood says the earthquakes in China, the cyclones in Burma and the floods in the Midwest have yet to generate such an outpouring.

It would be unfair to say that Americans—whether they are accountants in Kansas City, Mo., or bond traders in Greenwich, Conn.—are becoming stingier. Rather, philanthropy is a pretty large industry. Charitable giving in 2006 was $295.2 billion, according to Giving USA 2006, about 2.2 percent of gross domestic product. For comparison’s sake, Wal-Mart has annual sales of about $350 billion. And like every other industry, philanthropy is tethered directly to the health of the overall economy, and in particular to the health of the upper-middle-class consumer. If the past is any guide, it’s likely to be a lean year for nonprofits.

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How Poor Service Destroys Your Reputation

From: Donor Power Blog

Your programs are effective. Your organization is well-known and untainted by scandal. Your administration and fundraising ratios are admirable. Your brand is strong and your marketing good.

But your name is mud among your donors. And you don’t even know it.

How can that be? Sloppy service.

Donors’ names are spelled wrong. There are errors in addresses. You have duplicate records for the same households.

Or your records about donor giving is inaccurate.

Maybe donors have asked not to receive telemarketing, but they’re still getting calls. Or they’ve asked to receive less mail, but they’re still getting just as much as ever. You seemingly don’t intend to comply with their wishes.

These kinds of things are hard for you to see. But for donors, these things are huge.

They see sloppiness.

They see an ineffective bureaucracy.

They see an arrogant and uncaring organization.

They see money being wasted.

And they think that’s the whole truth about you. Is it fair? No. But what other information do your donors have to go on? The way you serve them is how they experience you.

You could spend all your time and money honing your message to perfection. But if your donors are experiencing sloppy service, your messaging might as well amount to giving them the finger. Actions speak louder than words.

Make sure your service is flawless. If it isn’t, make fixing it your number-one priority until it is.

A $10 Mosquito Net Is Making Charity Cool

From: The New York Times

Donating $10 to buy a mosquito net to save an African child from malaria has become a hip way to show you care, especially for teenagers. The movement is like a modern version of the March of Dimes, created in 1938 to defeat polio, or like collecting pennies for Unicef on Halloween.

Unusual allies, like the Methodist and Lutheran Churches, the National Basketball Association and the United Nations Foundation, are stoking the passion for nets that prevent malaria. The annual “American Idol Gives Back” fund-raising television special has donated about $6 million a year for two years. The music channel VH1 made a fund-raising video featuring a pesky man in a mosquito suit.

It is an appeal that clearly resonates with young people.

Addressing a conference of 6,000 Methodist youths in North Carolina last year, Bishop Thomas Bickerton held up his own $10 and told the crowd: “This represents your lunch today at McDonald’s or your pizza tonight from Domino’s. Or you could save a human life.”

The lights were so bright that he could see only what was happening at his feet. “They just showered the stage with $10 bills,” Bishop Bickerton said. “In 30 seconds, we had $16,000. I’m just lucky they didn’t throw coins.”

Part of what has helped the campaign catch on is its sheer simplicity and affordability — $10 buys one net to save a child. Nothing But Nets, the best-known campaign, has raised $20 million from 70,000 individuals, most of it in donations averaging $60.

That is a small fraction of the overall need, which experts estimate at $2.5 billion. But it gives the effort a populist edge, and participation is psychologically rewarding for anyone whose philanthropic pockets are shallower than those of Bill Gates.

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As Direct Marketers Cut Back, Mailboxes Are Less Crowded

From: Donor Power Blog

After years of increasing, the volume of direct mail is expected to decrease this year, according to a survey by Direct magazine: Survey Shows Mail Volume Slowdown.

(The survey only looked at consumer and business-to-business direct mail, not nonprofit.)

Basically, the survey finds that fewer businesses plan to increase direct mail, and more plan to decrease it. That’s something that happens in recessionary times.

And, if you’re smart, it’s very good news for you.

It means your mail sits in a less-packed mailbox, so it gets more mind-share. Unless you make the same mistake and cut back too.

Recession is not time for business-as-usual for fundraisers; it does have a negative impact on fundraising. But the last thing you should do is cut back. Doing that will only deepen and prolong your own down-turn.

Special Events Done Right

From: Philanthropy Journal

For long-term organizational health, nonprofits should strive to increase their overall visibility. Special events can play an effective role in this goal.

Accurately referred to as “cultivation events,” most special events should focus on awareness, visibility and sharing information.

With proper planning and a clear understanding of the event goals (cultivation through visibility), special events can help an organization connect with a wide audience in personally relevant and memorable ways.

Here are the top five tips to remember when planning an organization’s special event:

  • Match the event to the mission. Use events to help the organization realize its larger vision. For example, an environmental organization might organize a riverbank clean-up, or a food pantry might have a baking contest with all baked goods donated to the food pantry’s clients.
  • Make it unique. Bake sales and car washes are so common they tend to blend in to the background rather than standing out effectively. Brainstorm creative events not seen in your community. With unique events, media easily see the hook and give better coverage. Some unique ideas include “stay-at-home” events, clean-a-thons or community yard sales.
  • Market your message. The organization’s name and mission statement should appear prominently throughout the event. Identify key times to clearly communicate the organization’s message. Be sure to connect with local media and have volunteers available for photos and interviews.
  • Keep it fun. Events have a tendency to take on a life of their own. To-do lists grow, volunteers tire or get busy, and every task can seem burdensome. Always have someone in your planning group ready to keep everything in perspective. Events should be fun, not frightening.
  • Plan for follow-up. Good ways to follow up include adding prospect names to your mailing list and sending thank-you letters. Follow-up can be an email or personal phone call from a board member or event committee member to patrons of the event.

Special events can build relationships, helping the public feel connected to an organization’s cause. An event provides solid “face time” with the community, sometimes laying the groundwork for financial support. Events build loyalty, create buzz, and generate goodwill.

Best of all, since special events are not traditional marketing, they can be designed to work with your budget.

Call For Comments

Will we be sending fundraising appeals in this interactive format?

Check out Microsoft Surface. Watch the videos!

OHIO for Emails

Do you suffer from email overload?

I do (occasionally).

How do I manage email overload? I look to OHIO.

Only-Handle-It-Once.

My inbox is not cluttered with messages. In fact, I rarely have more than 30 emails in my inbox. I do this by responding to urgent emails, deleting irrelevant emails, using flags in Outlook to schedule later to-dos, filing FYIs, avoiding the “thanks” or reply-all messages, and asking friends and family to refrain from sending me junk.

Just recently, I was dealing with an over-enthusiastic emailing colleague at work. I created a filter in Outlook, routed her emails to a special folder and reviewed the folder once per week. Sanity quickly returned.

How do you manage your inbox?

Take a look at this interesting post on Beth’s blog.

Why Word of Mouth Doesn’t Happen

From: Seth’s Blog

Sometimes, what you do is done as well as it can be done. It’s a service that people truly love, or a product they can’t live without. You’re doing everything right, but it’s not remarkable, at least not in the sense of “worth making a remark about.”

What’s up with that?

Here’s a smörgåsbord of reasons:

  1. It’s embarrassing to talk about. That’s why VD screening, no matter how well done, rarely turns into a viral [ahem] success.
  2. There’s no easy way to bring it up. This is similar to number 1, but involves opportunity. It’s easy to bring up, “hey, where’d you get that ring tone?” because the ring tone just interrupted everyone. It’s a lot harder to bring up the fact that you just got a massage.
  3. It might not feel cutting edge enough for your crowd. So, it’s not the thing that’s embarrassing, it’s the fact they you just found out about it. Don’t bring up your brand new Tivo with your friends from MIT. They’ll sneer at you.
  4. On a related front, it might feel too popular to profitably sneeze about. Sometimes bloggers hesitate to post on a popular source or topic because they worry they’ll seem lazy.
  5. You might like the exclusivity. If you have no trouble getting into a great restaurant or a wonderful club, perhaps you won’t tell the masses because you’re selfish…
  6. You might want to keep worlds from colliding. Some kids, for example, like the idea of being the only kid from their school at the summer camp they go to. They get to have two personalities, be two people, keep things separate.
  7. You might feel manipulated. Plenty of hip kids were happy to talk about Converse, but once big, bad Nike got involved, it felt different. Almost like they were being used.
  8. You might worry about your taste. Recommending a wine really strongly takes guts, because maybe, just maybe, your friends will hate the wine and think you tasteless.
  9. There are probably ten other big reasons, but they all lead to the same conclusions:

First, understand that people talk about you (or not talk about you) because of how it makes them feel, not how it makes you feel.

Second, if you’re going to build a business around word of mouth, better not have these things working against you.

Third, if you do, it may be a smart strategy to work directly to overcome them. That probably means changing the fundamental DNA of your experience and the story you tell to your users. “If you like us, tell your friends,” might feel like a fine start, but it’s certainly not going to get you there.

What will change the game is actually changing the game. Changing the experience of talking about you so fundamentally that people will choose to do it.

Helping Pets Helps People…

From: The New York Times

DISABLED and living on a limited income, Rebecca Sahin said financial constraints once forced her to cook rice to feed her two beloved cats.

“They just looked at me and walked away,” said the Vernon resident, 33.

That was before a friend told her about the Kado Pet Foundation. Now her cats, Domino and Jazzy, are official “Kado Kids,” and Ms. Sahin knows the pets will receive nutritious food, kitty litter and proper veterinary care for as long as they live.

“For me, Kado was a sense of relief,” she said.

The nonprofit foundation was established three years ago by Kathy Hartmann of Windsor, a lifelong animal lover who said she wanted to help elderly, ill, disabled and low-income pet owners who might otherwise be forced to give up their animal companions or choose between buying food for themselves or their pets. Named in honor of her pet Rottweiler, who died in 2003, the charity helps to care for 50 dogs, cats and one bird with the aid of a dozen volunteers who travel to pet owners’ homes in central and northern Connecticut.

“The whole idea of Kado is to take the stress away,” Ms. Hartmann said. “Once an animal becomes a ‘Kado Kid’ they never leave, so people know their pets will always be taken care of.”

Because she saw that her dog Kado brought joy to many people, Ms. Hartmann said that when the dog died, she wanted to find a way to help other animals. At first, her quest took her to the local dog pound, but after she heard stories about pet owners who were struggling financially to care for their animals, she decided to start the charity.

She now gets referrals from local animal rescue organizations, social services, veterinarians and others. She and other volunteers spend many weekends in front of local supermarkets or at pet-related events raising awareness of the foundation and its financial needs, she said. It costs up to $2,000 a month to provide the necessary care for the pets in the program now, she said.

Alexis Soutter, a veterinarian in Manchester who provides care for about a dozen foundation pets, said many of those helped by the group are people for whom pet ownership is vital.

“Many of them are permanently disabled,” she said. “Many studies have shown that having animals can have a profound impact on these people.”

Kado has paid for health care for pets that otherwise would never have visited a veterinarian, Ms. Soutter said. In at least one case, the foundation’s intervention saved the life of an elderly cat suffering from thyroid disease, she said.

“Most people want what’s best for their animals and when they’re in a situation where they can’t afford that care, it can be devastating to them,” she said.

Ms. Hartmann, who owns a dog and three cats, said while her original vision for the foundation focused on helping animals, she now realizes how much the foundation also helps people.

Many of those whose pets have gotten help from the Kado Pet Foundation now help each other. Some attend fund-raising events, while others help deliver food, walk dogs or pet-sit when clients are not at home. If a client must be hospitalized or needs nursing home care, their pets are found good homes and brought to visit their original owners. Ms. Sahin helps by sharing with others what she has learned as she has navigated her way through the bureaucracies of social service programs.

Ms. Hartmann, who operates the foundation full time, said she hoped it could become a nationwide organization someday. Still, she says that the daily tasks are so time-consuming that it is difficult to focus on other needs, like seeking grants and updating the group’s Web site — helpforpets.org — so that it can accept donations. She worries that the 1986 Toyota Tercel she uses for pet care calls will soon be beyond repair, or that the group’s ancient computer equipment will finally crash.

“We’re always fielding curveballs,” she said. “But we always try to be there for people.”

Are You Asking Enough of Your Young Donors?

From: About.com

Surprisingly, younger donors give about as much as older donors.

According to a recent study by Campbell & Company at the Center on Philanthropy at Indiana University, donors across all generations give roughly the same amount to charity even when controlled for factors such as income, education and religiosity.

The study looked at more than 10,000 people across five generations and their giving trends. Here are the highlights.

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