By Jerry Huntsinger

The letter's in the mail, or maybe it isn't

Goodbye! More than 80 percent of you folks reading this issue will be gone when the next 15 year
anniversary rolls around. And probably only about 5 percent or less of you read the inaugural issue of The NonProfit Times 15 years ago. I'm the only original columnist still around.

Unfortunately, this high attrition rate will probably continue, because there is no indication that fundraising is going to suddenly or even gradually become a vocation of high esteem.

However, the mortality rate among fundraisers is an extremely minor issue compared with one single tremendous change that is going to revolutionize that aspect of fundraising that we label as "direct mail fundraising."

This change is already floating through the halls of Congress in the form of a major postal rate increase that will raise rates an average of 10 percent to 20 percent across the board. And, will that postal rate put the USPS in the black once and for all? Of course not. The deficit will continue to climb into the billions of dollars, and so, before long, Congress is just going to give up in disgust and cast their vote to abolish the USPS monopoly.

And that, dear reader, will spell the death of direct mail fundraising as we know it today. Why? Because private carriers, while they will get the mail into the homes, will charge whatever amount is necessary to accomplish that task.

This is going to cripple many direct mail fundraisers, because their entire economy is based on a false cost for the delivery of mail to the homes. When Congress stops subsidizing the value of a postage stamp and charities start paying the true costs, even if that cost is a so-called "charitable rate," goodbye forever to your prospecting programs and campaigns to renew your marginal donors.

Currently, as you know, charities mail out prospect pieces, hoping to get a 1 percent return and then hoping to renew 50 percent of those who make an initial gift. The mathematics of that strategy is based on low postage costs. Once that mathematical formula is busted, then what?

I remember back in 1962 (don't you hate it when an old fart like me starts off that way … ?) when you could put a direct mail fundraising package in the mail for 75 cents per thousand, including postage, lettershop, printing, and list rental. In those days we were successful, not because we were smart or had a fabulous strategy, but because everything was cheap, cheap, cheap.

But gradually printing costs went up. Lettershop costs went up. List costs went up. And yes, postage went up … until the day we are just on the edge. The very edge.

And then, when mail is privatized and we have to pay true delivery costs, that event will push us over the edge.

So, what will we do? Struggle. Discard our pet theories. Re-learn.

I've been forecasting this total collapse of direct mail prospecting for a long time now, and I've always thought that I'd be out of this business long before it occurred.

But also apparently, I'm going to be stuck in this situation right along with the rest of you, because my wife has many expensive hobbies and she says that as long as she has to cook the meals and load and unload the dishwasher, that I have to keep on writing fundraising letters. So I'll be down here in the trenches with you, searching for answers.

A few things I can predict, I think, with some degree of certainty. For example, human nature is not going to change here in America. Our grand tradition of benevolence is going to continue and perhaps even accelerate, if the aftermath of the terrorist attack is any indication.

And if we give potential donors the opportunity to participate in our programs, they will accept the invitation. We can count on that.

Also, we can depend on women!
I remember when (relax, it's just a short moment of reminiscing … ) I first went into the mailroom of a nonprofit organization and discovered that most of the checks were written by women, and most of the women appeared to be quite elderly. I based my career, happily, on that phenomenon. That was back when men dominated American society and women were allowed to make small, unimportant decisions such as sending a $5 or $10 check to a charity that touched their hearts.
Today, women are equal with men -- if not more than equal -- in making family financial decisions, and so they still write a majority of the checks, even though their handwriting is no longer old or shaky. This trend is going to continue until, 15 years from now, the predominantly female donor is going to be requiring a very high level of accountability from nonprofit organizations.

In other words, they are going to expect a high level of integrity from the charities they support. We'll have to shape up.

For example, a few days ago I received an envelope from an organization that read, "Gift Certificates Enclosed." But when I opened the envelope, the only enclosure was a reply envelope and a reply form that said "Christmas Gift Certificate." Just one.

So, was the teaser on the carrier a mistake? Or is there some clever wording on the single certificate that makes it two certificates? It's this kind of nonsense that donors are going to find objectionable.
Also, the emerging donor 15 years from now is going to laugh at the current accounting practices and standards, whereby if an orange is defined as an apple, then that orange is an education or program expense and not a fundraising expense, thus reducing the number of bad apples in the package.

This clever sleight of hand accounting technique is going to be replaced by something that we've needed for a long time -- that is, simply the truth.

Sure, fundraising costs will appear to be higher, but maybe that will force nonprofit organizations to evaluate their administrative costs and cut back on all those varnished desks behind which administrative vice presidents safely sit, developing their departmental budgets.

I think that, before the next 15-year cycle is complete, charities are going to go through an excruciating metamorphosis, and those who don't will be replaced by new groups springing up and quickly developing brand loyalty, similar to McDonald's, Microsoft, Coca-Cola, and so on. They'll use the Internet primarily as the media to develop this branding and direct mail into the home will be used to upgrade giving levels and develop special gift programs.

And will there be more nonprofit organizations attempting to raise money through the mail 15 years from now? Yes! Unfortunately, the current trend of overlapping, duplicating, replicating, copying and justifying existence is going to go on and accelerate.

But, on a positive note, these new organizations that will spring up will be lean and mean, and very self-directed and goal-oriented. Their overhead will be low, and they'll take up where the highly institutionalized mega-charities that exist today fail to communicate.

All in all, life will go on pretty much the same 15 years from now, except for the cost of postage and the prospecting problem. And when you go to a convention, you'll continue to find that the majority of attendees are suppliers. And I'll be one of them.

Jerry Huntsinger, founder of several marketing companies, is now "retired," having returned to his first love, creating fundraising packages, freelance. He can be reached at his email jerry777@bellatlantic.net

NPT staff writer Jeff Berger also contributed to this story

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