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The fundraising challenge

Fundraising operations, for a long time, the most important activity in many charities, currently face an immense challenge as changes in society, patterns of giving and governmental decisions all have an impact on charitable giving. These must increase their revenues in the face of a long-term decline in charitable giving from the heights of the early 1990’s.

Despite a recent upturn, charitable giving has fallen by 25% in the last decade as a percentage of GDP (source: Charities Aid Foundation, 13/11/2003). The recent upturn is clearly linked to more professional fundraising and the introduction of Tax incentives in 2000 but is not in line with the growth of the economy. Public funding of voluntary organisations has also increased to 40%, yet central and local government is under pressure to reduce spending and it can only be a matter of time before public funds for charities start to be trimmed or even withdrawn.

The facts are simple, the proportion of people giving to charity remains static at around 67%. Currently only a small group of donors give more than £50.00 per month, yet this group contribute over 60% of the total amount donated. Planned giving has grown, with over 15% of donations coming from direct debits and standing orders (source: NCVO 2002). The fastest growing method of giving is payroll-giving which grew by 33% in 2002 to a total of £73million. Women still give more than men and are also more likely to give in the first place.

“Being able to easily convert more supporters from occasional giving to committed giving by direct debit is nirvana for a charity.”

The dichotomy is that with economic growth and changes in society there is more disposable income available, yet charities are actually getting less as a proportion of that disposable income.

Are charities losing out?

It is a simple fact that big business has stolen the lead in customer relationship management. We have all witnessed the growth of affinity marketing and brand loyalty. Link this with fast paced technology changes and the result is that big companies are taking a larger proportion of that disposable income leaving less for charities.
Big companies have strategically moved away from product marketing and now focus on customer marketing. They are increasingly using technology to support personalisation techniques to deliver specific messages that drive brand loyalty and ultimately spend.

The irony is that charities invented the concept of customer relationship management. It has always been the very nature of what they do, yet the need to deliver focused messages to the supported community, to retain and motivate the volunteers; to take advantage of new forms of giving and to be able to exploit the masses of information have been beyond the resources of charities until today.

Taking the challenge head on

Behind the successful delivery of the organisation’s aims, there needs to be an equally successful fundraising team. Their biggest challenge is; how do we use our assets to our best advantage to give us the ability to have a greater reach without increasing administrative costs?

In short, this translates to utilising the information that we have for a wider range of marketing activities, generating a larger revenue stream at a lower cost.

The critical components to revenue streams are the supporter and the volunteer. Even today, most charities still see supporters and volunteers as separate groups and engage with them as separate groups. Historically this was because the systems were not in place to manage it in any other way and it was also the only way to deliver a personal approach.

The tools are now available to link all the separate databases together and see that there are individual people who support the charity in many different ways. These are all people that we should think of as customers. Despite the support that the charity receives from these supporters, they know very little about them. In reality the supporter base is sophisticated and complex and cannot be treated as one mass of support.

In addition to the wide socio-economic spread there is a huge range of hobbies, interests, corporate associations and general spending power that comes with knowing more about the supporter. This is where most charities fail. Customer or supported data is distributed into a wide range of databases from a variety of sources; events and campaigns, financial transactions, supporter databases; volunteer database; sales of products; service enquiries; major donors and corporate databases. In very few cases does this data form part of a central “customer database” that allows the charity to build a detailed profile of the supporter base.

With today's database technology, not only is this possible, but it becomes an absolute necessity if the charity is to sustain its long-term financial stability to deliver on its aims and objectives. Customer Interaction technology has been adapted by many commercial organisations for the last 10 years, but in professional fundraising where the potential benefits are huge, charities have not scratched the surface.

An integrated approach from CIBER

CIBER has been an author and implementer of highly successful Customer Interaction solutions since 1996. Its highly regarded and technically advanced software utilises the latest Microsoft technology and offers a flexible and powerful solution. Using Ascent, charities can integrate and replace multiple existing data sources to create a sophisticated profile of all supporters, which is held in Ascent. In effect this creates a “single view” of all the facets of the relationship that the charity has with the supporter.

“Cross-marketing to everybody who interacts with any service that the charity provides is an essential aspect.”

This makes it easy to profile a target audience for any campaign that you wish to undertake, irrespective of the original source of the data, whilst ensuring that there is no duplication of data.

Improving the interaction with supporters

Maintaining a complete picture of your customers is only half of the story. Certainly it is the basis on which increased loyalty and revenue generation can be based. However, this only creates a harmonious environment when the information is used to enhance the relationship with supporters through continuous “bi-directional” communication between the supporter and the charity. Supporters are more committed where they feel that their contributions have an effect and where they feel they belong to and are part of something positive and this can only come through personal communication.

“Just think of the results if we could find a cost effective way to treat all supporters the same way we deal with major donors.”

As long as the charity takes the time to understand them and to make them feel like a stakeholder, the supporters will be willing recipients of any relevant propositions the charity makes to them.

The problem the charity faces is two fold; first to be able to utilise advanced technology easily to perform fast profiling and segmentation across databases measured in the tens of millions and then in managing this two way communication.

The benefits are readily identified, but how do you create a situation where the supporter can participate in an ongoing dialogue, where they can reflect their opinions and needs?

Ascent Not for Profit

The answer lies with Ascent Not for Profit. This solution for Professional Fundraising and External Relations is an integrated customer information and e- communications medium that utilises the profile held against the supporter to manage a personalised, relevant dialogue. By combining customised “micro-web sites” with a modern e-mail marketing capability, the supporter can become involved in the community. Supporters can communicate back with up-to-date contact details, areas of interest and opinions on anything from their favourite event to their views on the campaigns.

The essential element of the solution is that all of the supporter's interactions with the charity, in whatever form, are recorded in the central Ascent Not for Profit database. Everything from immediate purchasing decisions on products to donations received and questionnaire responses is maintained against the supporter's profile.

Not only does this close the loop on the original campaign, but it also gives us an invaluable insight into the supporter's areas of interest and thus creates more specific audiences for future campaigns. As the charity learns from each interaction and builds innovative and relevant offerings, it can carry the supporter along using this mechanism for years to come. The dimension of “self service” is critical to the success of the process.

Building long-term value and additional incomes

This relationship of mutual gratification is of huge interest to sponsors and suppliers of affinity products. Not only do they have the ability to associate themselves with a brand that has a significant supporter base, but they also now have a built-in ability to communicate with and serve the supporters as well. Supporters can immediately flag the products and services that they are interested in, thus giving a direct route to the supporters in their own home. Loyalty schemes can be incorporated in order to tie the supporter to products offered through the charity.

As long as the offerings reflect the supporter's specific requirements as defined by them in their profile and through interaction with the charity, the potential increase in revenues is huge and sustainable.

It is no longer acceptable to simply record supporter data from donations and volunteer systems. The key to increased loyalty and revenue generation is to be able to build a profile based on this information and to be able to act upon it. Suppliers of consumer products and services are desperate for the information that charities can generate from their supporters. Now it is time for the charities to exploit big business.

“Let modern relationship management and e-marketing technology help you take big consumer businesses head on.”

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