BIG’s Blog: Something Big is Going on Here.

Last week, Target Analytics released their Target Analytics Index of National Fund Raising Performance for calendar year 2010.

Most...but, not all...of the clients we have worked with, as well as the many fund raising organizations that we have talked to experienced their last good direct mail fund raising year in 2005. We define “good” as measured by net contribution to the organization, not top line revenue. Since that time, the vast majority have seen revenue flat to slightly increased in the Religious sector, donor numbers decline, and declines in retention rates with the Religious sector having the largest declines in first-year donor retention for the whole index.

But, even more important, (and, of course, Target Analytics did not have net profitability information), the net profitability due to contracting margins on direct mail has fallen consistently since 2005.

This isn’t one or two bad years that we can blame on the economy, the report states, This continues a trend that predates the recession. The results indicate that these declines are consistent with a fundamental and structural change in the effectiveness of the direct mail channel.

What, if anything, can turn this situation around?

Frankly, nothing is going to turn this trend around. Are your children, nieces and nephews going to go back to reading printed newspapers as their major source of news...even if they got it for free? Or, hitting closer to home, how has the digital revolution changed how you consume news?

So; what to do?

We will take that up in tomorrow’s blog.

-Mike

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