The other day I got a phone call from one of those chop-shop telemarketing funds. It must really stink when you’re auto-dialer leads you to a nonprofit efficiency professional in a chatty mood. I pulled up the organization they were raising money for on Guidestar and peppered them with typical round one questions that grant applicants get from us when we’re vetting grants for Do More Mission clients.
What happened next surprised me. The caller quickly volunteered that 90 percent of the money raised pays for their company’s costs, and that 10 percent goes “directly” to the charity — she said this with tremendous enthusiasm, as if to impress me. WOW! Those of you who know me or regularly read my blog know that I’m the furthest thing from a “program ratio facist,” but even I had to catch my breath with that one!! Incredulous, I paraphrased “only 10 percent of what I send you today goes to the charitable organization your company is working for, and then they pay for more overhead before actually doing anything charitable with my money?” I was transferred to a supervisor.
One thing my favorite direct response fundraising consultant pointed out to me when I told her this story, is that if the 10 percent number were for the donor acquisition telemarketing program alone, it’s actually not an unreasonable figure (I know, I know, she’s the ultimate “benefit of the doubt kind of person, that’s how she’s put up with being married to me all these years!). But that number is shop-talk. The average consumer wants to know about the overall ratios of the organization, not of their various donor acquisition programs.
I think something very different is happening with this one. It’s interesting to note that I didn’t ask them for program ratios or the costs of the telemarketing operation. This is information they volunteered. Frankly, I think they mention that 90 percent/10 percent number and have it built into their callers’ script in a way that most people hear it as 90 percent goes to the charity, 10 percent goes to the fundraising company. Misleading, but not a lie.
I had asked the supervisor for the name of her firm and did a little Googling. Looks like a lot of folks think their scamsters. I can’t help wondering if they are actually working for the charity they called me about or if they had hijacked the name and were truly a fraudulent shop, sending SOME money to the charity to legitimize themselves on a technicality. Frankly, I HOPE they are fraudulent, and I’ll tell you why in just a moment.
I am a big fan of charitable organizations using direct mail and other techniques for acquiring small gifts from large numbers of people. This builds their donor base, insulates them (some) from market fluctuations, and fills their mid-level and major gift pipelines, giving development staff years to cultivate upgrades. But hiring a slimy chop shop can destroy a charitable organization’s reputation faster than any scandal ever could. That’s why I said I HOPE this operation turns out to be fraudulent. This company’s representatives came off as unprofessional and under trained. Organizations need to think carefully whose service they engage to execute acquisition activities. Hiring a hack firm without considering the impression it leaves behind about your organization’s integrity and credibility won’t help you build a healthy, upgradable donor base. It will erode public confidence in your organization no matter how wonderful the cause is.