From the USA’s tax-effective planned giving programmes to Abu Dhabi’s clever zakat ATMs, Tobin Aldrich takes a tour of the most successful fundraising techniques around the world and asks: could these work here too?
Fundraising is a universal human activity. It’s been going on for a long time. We don’t know who the first fundraiser was but the activity goes back thousands of years. The first fundraising appeals would have been from the priests, the chances are that the sarsens of Stonehenge and the ziggurats of Ur were built at least in part by freely given labour and supported by gifts of food and precious objects. It’s hard to think of a human society since where private philanthropy hasn’t occurred, and usually it’s played a vital social and economic role.
While fundraising happens nearly everywhere (I’m not sure about North Korea), it doesn’t take the same form in every country. Part of the fun of my life as someone who does international fundraising projects is seeing how philanthropy varies from country to country.
Sometimes fundraising in other markets can seem very familiar. Some techniques work in a very similar way in most countries they've been tried. Face-to-face fundraising is now a commonplace of emerging fundraising markets such as India, Brazil and Indonesia. TV campaigns run by major international NGOs such as Save the Children work successfully in lots of countries with essentially the same creative approaches and formats. Digital fundraising also seems to be an area where broadly the same elements are successful in many different places.
Differences and nuances
But there are always differences and nuances in individual countries, whatever the outward similarities in approach. So direct response television advertising works in a very similar way across Europe, except that celebrity endorsements are much more important in countries like Italy and Greece than in the North of the continent. And Italians prefer to respond to ads by phone whereas Swedes, for example, prefer to give by text message. Indian fundraising is complicated by the idiosyncrasies of the banks, so charities employ a host of men on scooters to go and collect cheques from individuals who have pledged over the phone. In every country, the local cultures and context determine the messages and mechanisms that work.
Successful fundraising everywhere is based on asking for money appropriately. That's very different in Chinese culture, for example, than in Europe. But everywhere, fundraising fundamentals are the same. The compelling and emotive proposition, a clear call to action and good stewardship and reporting back are what makes the difference between fundraising success and failure, wherever you are.
Good ideas that have spread
Fundraisers everywhere are quick to spot and copy what works. We find that fundraising techniques and approaches that work in one country rapidly spread. In today’s connected world, good ideas can disseminate very fast.
British fundraisers have been among the leading innovators in fundraising techniques and approaches. The UK pioneered low-value regular giving, initially by bank standing order, in the 1980s with Oxfam running mass marketing campaigns to recruit £2 a month donors.
Legacy marketing was also a UK development, starting with the free wills guides offered by major charities in the same decade.
However, we have also copied greedily from other countries. Here are some examples of techniques and campaigns that have been developed elsewhere but have entered the UK market.
Austria – Face to Face
Asking someone for money face to face is the oldest form of fundraising. But standing on a street with a clipboard asking a stranger to take out a direct debit for a charity is rather more recent. What we currently call “face-to-face” or “direct dialogue” fundraising (or, heaven forbid, “chugging”) started in the mid-1990s in Austria with Greenpeace.
It was so successful that other parts of Greenpeace rapidly adopted it, coming to the UK in 1997 at that year’s Glastonbury Festival. Within two years, over half a million individuals had been signed up to direct debits by UK charities using this technique, and within five years the number of people giving regular gifts to charity in this country had doubled, driven by the success of face to face.
Australia – Movember
In 1999, a group of young men in Adelaide, South Australia sitting in that cradle of fundraising ideas, the local pub, came up with the idea of growing a moustache in the month of November to raise money for charity. In the years since then, this simple idea has raised over £400m for cancer charities worldwide.
Australia has come up with a disproportionate number of ideas for fundraising events that have gone around the world, for instance, sobriety challenges like Go Sober are also an Aussie idea. WWF’s Earth Hour originated in a Sydney pub.
USA – Major gift fundraising
Major giving is another technique that is probably as old as fundraising itself. Getting the richest members of society to contribute has been an essential part of fundraising appeals since the earliest days. But the structured approach to major gift fundraising, based on a (typically) seven-step approach from prospect research to donor stewardship, has been an import from the strong major gift culture of the US.
Today, almost all major UK fundraising charities possess a major donor programme with dedicated staff and resources. However, while techniques are easy to copy, cultures are less so. Board engagement with major giving, for example, is much weaker in the UK than over the Atlantic. The results from many major donor programmes suffer accordingly.
USA – Crowdfunding
Crowdfunding of artistic ventures has a long history, but the first websites that enabled a group of likeminded individuals to invest in a creative project emerged in the late 1990s. Before long, sites such as Indiegogo and Kickstarter were being used to fund projects of all kinds, and crowdfunding has now become an industry with an estimated value of over £30bn worldwide.
From the early days, crowdfunding platforms were being used to fund not-for-profit ventures, and now they are an integral part of the fundraising landscape across the globe. To some extent crowdfunding has simply extended the peer-to-peer fundraising model long used by charities for fundraising events that websites such as Justgiving have digitised. However, crowdfunding is also further democratising the process of fundraising with individuals increasingly bypassing the mainstream non-profits to raise money for very specific projects.
The implications of this shift are only slowly being grasped by many charities, who will increasingly find their roles as intermediaries between donors and grassroots programmes under question.
Fundraising ideas to come?
I have also seen great examples of fundraising in other countries that haven’t yet taken off in a big way in the UK. Only time will tell whether they catch on here, but the following examples demonstrate the range of techniques that are being tried and tested elsewhere.
USA – Planned giving
Planned giving is where a donor makes a deferred gift of cash, equity or property to a charity and receives tax advantages in return. It is very big business in the US, accounting for as much as a third of the revenue of many large non-profits.
With the important exception of legacies, which are of enormous importance to UK charities, US-style planned giving has never taken hold over here. The principal explanation is the differences between the respective tax codes in the two countries; the US offers donors more tax advantages.
However, there do seem to be opportunities to develop more flexible methods of tax-effective giving in the UK and to publicise those schemes that do exist; it is for example very tax effective to make gifts of equities to charities, but this form of giving seems relatively under-utilised.
Australia – High-value regular giving
The Australian and UK fundraising markets are very similar in many respects. One way in which they differ is that the average regular donation to charity is much higher in Australia – around £20 per month. We don’t know why this is exactly but the most plausible explanation I have heard is that regular giving essentially started in Australia with the child sponsorship charities, principally World Vision. As child sponsorship is a high-value product, this set the expectation for levels of gift and other charities simply followed at the same level. In fundraising you tend to get the gift sizes you ask for.
It’s an interesting contrast to the UK, where the market was educated that charities wanted £2 a month gift, which is, largely, what they got.
Greece – Donor engagement
If you think you have fundraising issues in your market, think of how hard it is currently for charities in Greece.
To say that the Greek economy and society has gone through a difficult time of late is a statement akin to suggesting that the Titanic had a bit of a buoyancy problem. Since 2010, the economy has shrunk by over a third and unemployment has risen to levels higher than in Germany during the Great Depression. A fifth of Greeks don’t have enough money to pay for basic food essentials. And now Greece is in the front line of the European refugee crisis with thousands of desperate people fleeing war stranded in the country as other EU member states shut their borders.
So how does a charity that raises money to support poor communities in Africa (mostly) deal with a situation like that? How can you fundraise at all in that context?
ActionAid Greece last year raised more money from individuals than every other charity in the country - nearly £7m. They achieved this by taking engagement with their supporters extremely seriously.
They treat supporters as partners, for example by asking them in advance if they should start work in Greece as well as supporting projects in developing countries. Each year, they take dozens of supporters to see the projects they are supporting and these trips focus on real engagement between sponsors and communities. Child sponsors work alongside locals, building schools or planting crops, learning as much as they can how the others live.
These donors come back from the trip as evangelists for ActionAid’s work. A third of new child sponsors are recruited by existing sponsors, many by those who have experienced field trips.
Sweden – regular text giving
Text giving has been around for a few years now and we have had regular gifts via SMS in the UK for just over 5 years. But we can still learn from other countries. In Sweden regular giving by text has been going for several years and works very well. You can give sizable amounts (up to around £10 a month), and compliance isn't burdensome. Many charities use it and donors understand it perfectly well.
Other mobile payment systems are pretty advanced. WyWallet, a payment system that unifies SMS giving, mobile payments and e-commerce on the same platform has a million users in a population of nine million. Having downloaded the app you can make single or regular payments simply by entering a pin code. That's neat.
Abu Dhabi – the zakat ATM
Worldwide, the highest-value donors are those motivated by religion. Islam requires its adherents to donate 2.5% of their income for good works every year (zakat). Recently, I was in a shopping mall in Abu Dhabi where I saw a zakat terminal. It looks like an ATM. It will calculate how much Zakat you should pay and you can make your payment by cash or card through it. You can even check the status of your zakat account. This integration of charitable giving into daily life is something we can learn from in the UK, I think.
The increasing global spread of fundraising
Recently, I've been to some countries where fundraising as it's recognised in the UK is just starting. With different projects, I've travelled to Nigeria and Georgia (the country) and seen the early days of fundraising programmes in countries with no tradition of charitable giving outside religious contexts.
Fundraising is definitely becoming increasingly global. It is fascinating to see which fundraising principles are the same everywhere and which differ by cultural context. What is clear is that there are good ideas everywhere, and much to both share and learn from.
Tobin Aldrich is an international consultant in fundraising and marketing strategies for non-profits. Tobin has over two decades’ experience in marketing in over two dozen countries across the globe. He can be reached at firstname.lastname@example.org.