December 1, 2008

Economy Changing Charity Marketing Strategies

Almost two in three nonprofit executives said they plan to change their marketing strategy because of the economy, according a recent informal survey by the Direct Marketing Association Nonprofit Federation (DMANF). More than two-thirds of respondents said they plan to use newer marketing techniques in the near future, such as blogs, social and mobile marketing and other Web 2.0 tools.

Almost as many organizations said they are doing worse (40 percent) now compared to last year as those that said about the same (41 percent). Fewer than 20 percent said they are doing better now than last year.

Only 13 percent of nonprofits reported that response rates are better than the same period last year, while 63 percent said they were worse and 24 percent said they were the same.

When it comes to individual donations, more than 40 percent of respondents said they’re seeing smaller gifts and fewer individual donors while a third said they’re seeing larger gifts and fewer individual donors. Almost 14 percent reported smaller gifts and more individual donors and 8 percent, larger gifts, more individual donors.

Almost one in five nonprofits that responded plan a hiring freeze while 13 percent plan a reduction in their marketing budget, 8 percent a reduction in staff, and 6.5 percent a reduction in programming. More than 21 percent responded with “other” changes, which included among other things, a four-day work week, 5-percent cuts in all budget areas, not hiring a major gifts officer, a one-year wage freeze, reducing health insurance benefits, and postponing the announcement of or at least reviewing plans for a capital campaign.

One nonprofit is revisiting its real estate acceptance policies and procedures, given that “gifting of real estate seems to be retarded by the Florida housing market.”

Another organization reported that while there has been no impact on 2008 so far, preliminary planning for the 2009 budget is cautious. With the prospect of rising paper and postage costs, it could result in a reduction of the direct mail acquisition budget.

With fears of dramatic postage rate increases next year, nonprofits are looking beyond mail when it comes to their direct marketing programs.

Several nonprofits plan to decrease their mailings, in some cases employing different strategies. One organization said they would make a big push to capture e-mail addresses and make transactions online, making better use of their database with a strategy of more targeted, lower number of pieces mailed. Another would plan to downsize packages, limit testing and perhaps eliminate one mail campaign. In one case, a nonprofit expects to stop prospecting entirely, while another said it would continue to mail but boost its online presence.

A “green” or paperless membership already has been added at one organization, where members who select it would no longer receive paper correspondence.

Already expecting a future postage hike to be too high for the organization, one nonprofit planned to revamp its renewals to include postcards with a drive to the Web, more emails to drive member renewals and potentially reduce the length of the member magazine.

Other avenues of fundraising, such as Web, print and radio, are being explored by another organization, which is also considering the use of television for new donor acquisition. The same group is testing to determine the optimum number of mailings to serve its mission and donors.

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This article is from NPT Weekly, a publication of The NonProfit Times.

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