Direct mail among least cost-effective fundraising techniques 1

Fundraising | 9 Jun 2009

New research on the most cost-effective forms of fundraising shows that newspaper advertising and direct mail are ranked last.

The latest research, commissioned by clothes collection company Clothes Aid and carried out by rating website

Intelligent Giving, shows that fundraising from major donors and trusts are most cost-effective methods. Intelligent Giving’s lead researcher Sarah Hedley said: “Some of the fundraising methods that seem to be the most popular are not the ones that get the best returns. That is especially the case with direct mail. Compared to some of the others it has comparatively low returns per pound of investment.”

She added: “The real winners that come out are major donors and trust fundraising.”

Outgoing director of Intelligent Giving, Adam Rothwell, told PF: “We based the survey on something Adrian Sargeant did in 1999 and it is really interesting that our results are similar to his.

“This is the second time in ten years that this message has come across – really common direct marketing methods of fundraising yield significantly lower returns.”

Although the survey was commissioned by Clothes Aid, Intelligent Giving’s Hedley said it is difficult for her to draw any conclusions about the practice from the results because the sample of charities carrying out door-to-door clothes collections was so small – just three out of 40 respondents.

Michael Lomotey, of Clothes Aid, said: “Charities are well informed and very experienced when it comes to fundraising but there is a lack of research on the effectiveness of different methods of fundraising. We wanted our partners to be able to compare what we do with other methods and help inform themselves of the benefits.

“Even though there was only a small number of respondents, the findings support our belief and experience that clothing collections offer a very reasonable method of fundraising which factually is risk-free and requires no financial investment from the charity. The research can also be used by local authority licensing officers to better understand the range of fundraising methods and their effectiveness.”

Directory: Intelligent Giving

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Helen Nott
Director of Supporter Marketing
Woodland Trust
4 Mar 2010

I struggle with reports such as this which confuse efficiency with effectiveness. Whilst major donor fundraising and grants may be very efficient ways of raising money, they may not always be the most effective. If you already have an efficient team of fundraisers working with grants and trusts it doesn't mean that adding more will be as efficient, in fact it is likely to be the opposite.

The challenge in any fundraising strategy is balancing the levels of investment across different techniques and approaches to ensure that the overall model maximises both efficiency and effectiveness balancing value for money with the scale of impact.

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