Thrown Out Money

Our mailbox is overflowing with fundraising letters this time of year. They come like lemmings to the sea, each envelope thicker than the other. I've posted before about the inefficiencies in many/most tzedaka organizations and almost nothing has changed. We read and hear about how charitable giving is down this year and how charitable organizations are hurting. A few have shut down operations; others are coming close. And yet, their methods and mailings remain the same.

Professional fundraisers know that a 5% response to a fundraising mailing is an excellent response; many get far less, today especially. Yes, 5 people out of 100 is an excellent response; 2-3 is more like it for most organizations. But in far too many cases costs exceed incoming donations, and the net monies to the organization are zero or minus zero. If we are talking absolutely rock bottom in expenses for preparation, supplies and sending for an envelope containing nothing but a single sheet letter and a small response envelope, we are still talking about 22-25 cents cost per letter. So mailing out 100 letters costs $25. An excellent response of 5 people contributing could bring you in $50 with minimum donations of $10. That means a 50% overhead for the mailing. But what if you get only 3 responses per hundred, the likely scenario today? That results in $25 spent to make a profit of $5. Are your donors more generous, sending in $18? Those three expected donations result in $54 sent in and expenses of $25 for a net of about half.

What happens to most of those fundraising letters?--honesty required here. Those letters from organizations/institutions you have given to in the past may be put away to be sent to. Those to whom you have in the past decided not to send to are going to end up in the trash. New organizations? Maybe you'll open the letters and more likely you won't. Letters from outside your geographic area? Less likely to be sent to than those that come from your "neighborhood" or extended neighborhood, especially in these tight economic times when many people are restricting their tzedaka giving to local organizations.

Here's another flash: the thicker the envelope, the less likely that a donation will be sent. Picture yourself when you open those fundraising letters--do you sit down and read every word? Maybe, if the letter is one page and short. More likely you skim the letter, look at whose signature is on it and decide yes or no based on whether you've sent them before and on how much money you have available right now. If a letter is more than two pages and/or there are brochures or other materials in the envelope, most people don't take the time to really read anything in the envelope. It takes too much time and there are 20 more envelopes waiting for the contents to be read. And here's some news: the thicker the envelope, the more that is in it, the more it costs to mail that envelope out. That $25 above spent on sending out 100 envelopes doubles, triples, quadruples and quintuples. Yup, it now costs from $50 to $125 to send out those 100 envelopes: what doesn't double, triple, quadruple or quintuple is the response. The same $50-54 dollars is being sent in, resulting in zero money raised or a loss.

Some organizations annoy those to whom they send letters by sending a barrage of the same fundraising letter every two weeks or so. Some send the letter every month. Others send out their letters before every major major yom tov and some of the minor ones as well. At a minimum I hear from most organizations 3-4 times a year.

Some organizations are still working with 19th Century methodologies. I asked to be removed from one organization's mailing list, hoping to save them the money spent on mailing to me. The person I spoke to said it couldn't be done; the cost of getting my name off the list would be more than the cost of just sending me the mailings. Mail merge anyone? Just what computers are they using and who is it that handles the mailing list? How long do you have to be on a mailing list without ever having responded before someone notices and maybe says "enough"? And speaking of computers, just why isn't a lot of this fundraising being done via email today?

Not enough bad news for you yet? The costs I mention above are for rock bottom costs for mailing. Those costs assume volunteers who are running the organization and no other overhead costs. That isn't the actual case, however. Most of these organizations have paid people manning their have-to-be-paid-for offices. There are expenses for utilities and phone lines. There is the cost for supplies. There may be transportation and transport costs. Those costs have to be paid before the organization can begin to donate the collected funds to those who are going to get them. And those costs reduce the amount of money available for the actual work of the organization.

Just picture this: someone standing outside and pitching quarters into the sewer, lots of quarters. Now picture them ripping up dollar bills and also throwing them into the sewer. That scenario happens every day in many organizations. It is more than past time for organizations to rethink their fundraising activities and fundraising methodologies.

And while they are at it, could they also get someone to write those appeal letters who can actually write English? Using correct grammar and vocabulary, spelling words correctly, is not against Halacha. And could they pleeeeease figure out that a one-size-fits-all letter with the same letter going to thousands of people just might not fit anyone? Could someone please tell them that a solicitation letter is NOT about what they want but about what the reader needs? And could someone tell them that using fear and shame tactics don't work when the garbage can is just a step away? When I was young, mothers routinely told their children to eat everything on their plates because "Children are starving in_________!" That didn't work too well on us back then, and it works even less well when it's part of a fundraising appeal, especially when every organization is using the same methodology.