Nonprofits Are Election Losers

Some of the nation’s largest nonprofits experienced severe declines in direct mail response during late 2000 and early 2001, some as much as 50 percent. Direct mail experts believe the uncertainty of the national election and a slowing of the economy are to blame for the reversal of fortunes.

This past year’s election, so close to call that it took more than a month to declare George W. Bush the winner, may have monopolized donors’ attentions.

The general decline was a topic of discussion in the hallways of the recent DMA Nonprofit Washington Conference in Washington, D.C. "From the nonprofits I’ve spoken to, some clients, some not clients, some clients of other agencies that I just have contact with, during the fall results were very… They were down," said Chip Grizzard, president of Grizzard, a direct marketing agency in Atlanta.

Grizzard said reasons vary as to why many of his clients and other nonprofits had poor fall direct mail campaigns, but the turmoil of the election and declining consumer confidence are what he believes contributed to the slide. "There’s just so much uncertainty that hit right there in 2000, that we just think that people got distracted and concerned and didn’t really feel like giving up their charitable dollar," he added. "The overall that I’m hearing that fundraising results were down, and specifically for larger clients that focus on disaster related services."

Grizzard continued, "They were impacted probably more than others … The Salvation Army, and (American) Red Cross, and some of the international relief agencies, as well, just saw declining results. That probably started in the September timeframe, some of them being down up to 50 percent in that timeframe."

Margaret Guellich, CFRE, and director of direct marketing for Baltimore-based Catholic Relief Services also said direct mail response was flat. But, the CRS fall campaign performed well when compared to 1999. "It depends on which one of my colleagues you talk to," said Guellich. "Some of them had extremely poor Decembers. Some of them had extremely poor Januarys (2001), with a complete turnaround in February — the first week or two in February, for whatever purpose."

CRS had a successful Christmas campaign, which performed 12 to 14 percent better than 1999’s campaign. However, other segments of their direct mail strategy fell "absolutely flat," she said.

As for reasons why the fall of 2000 was dismal for a number of relief organizations Guellich offered, "I’m not too sure because in a relief organization sometimes people might just, in an ad-hoc fashion, send money into the organization. So last year (1999) in December there were all the floods… There’s Venezuela; there was South Africa… There was a whole bunch of floods."

According to Guellich, each year a range of people send in what is called white mail, which is where people write the organization’s name and address down and mail in a check. "So that that could be a reason why when I compare December of 1999 (the Christmas campaign), that is sees lifts but our white mail is down. Our white mail is down probably about 20 or 30 percent."

Guellich had no explanation as to why their white mail was down but said, "It could be that in ’99 people sent gifts in for the emergency versus there was no emergency actually at the end of December this year (2000)."

A consultant that believes election distraction is partially to blame for lower response rates is Dennis Meyer, CFRE, and president of Meyer Partners in Schaumburg, Ill.

He said that there is a sense that direct mail during November and December was down and that people were so preoccupied with the election fiasco that they paid less attention to mail solicitations.

"We speculate that the election, the turmoil, and the nightly news (had) everybody’s focus," Meyer said. "The media’s focus on the election battle in Florida turned everyone’s attention away from reading their mail."

Meyer said that was the impression he was getting, but that perception seemed to echo throughout the halls of the conference.

Meyer compared lower response rates to what happened in the fall of 2000 to similar low responses during Operation Desert Storm nearly a decade ago.

"This same thing happened with the Middle East war. During that timeframe, when we had mail out, the same kind of phenomena happened. People were just glued to their television and couldn’t think about other issues except that."

Another reason Meyer said may have contributed to lower response rates for certain relief organizations is the lack of them in 2000.

"You have "Relief Only" donors… "Disaster Only" donor," explained Meyer. "You know "Disaster Donors" typically won’t respond to anything else. If they came on as a "Disaster Donor" it’s the old axiom, ‘as they are acquired so they renew.’ So the disaster factor is huge."

According to Christopher Cleghorn, senior vice president, direct marketing, of the National Easter Seal Society in Chicago, while acquisition mailings were down for the organization, renewal mailings were strong. "In terms of the fall, basically donors have been strong, and acquisition’s been soft."

Cleghorn said he would only be speculating what reasons attributed to the range in direct mail package performance because they are difficult to read.

"Generally one doesn’t know, (it’s) just speculation. There was this whole election situation," said Cleghorn. "There are a number of things that one could look to but we don’t know for sure."

Cleghorn said any number of scenarios could have contributed to softer response rates in the fall including the election situation; just the election overall and then the complications of this specific election; the slowing of the economy; and waning consumer confidence.

Moreover, Cleghorn said technical reasons could also factor into scant response rates. "Look for what types of technical things happened… Did mail not get delivered, was there a big slowdown in delivery, or was a mistake made in the production," he said.

In fact, for example, numerous nonprofit in the Chicago area have reported that their fall campaigns were not even delivered by the U.S. Postal Service until early January because of a snafu. Those organizations are now starting to receive some responses.