You’ve Got a Charity Solicitation

E-mail gains favor with groups, but some fund raisers are wary

Two years ago, Stanford University began sending a monthly newsletter by e-mail to

thousands of alumni and others, informing them of campus accomplishments and promoting forthcoming events. The newsletter, called @Stanford, has shown itself to be not only a quick and inexpensive means of distributing information but also a powerful fund-raising tool.

Half of the alumni who received the newsletter for at least a year made a gift to Stanford last year, counting all the recipients who held an undergraduate degree from the institution as well as those alumni who also went on to do graduate work on the Palo Alto campus. By contrast, only one-third of the alumni, undergraduate and graduate, who don’t receive the newsletter donate to Stanford.

Like Stanford, a growing number of nonprofit institutions are using e-mail to reach out to current and potential donors. While e-mail is unlikely to supplant traditional direct mail as the most lucrative and widely used fund-raising method — at least for now — many organizations are exploring it as an easy and versatile way to reach people who have not given previously, especially people in their 20’s and 30’s.

“Younger donors are using the Internet to communicate with family and friends,” says Adam Corson-Finnerty, director of development for the library system at the University of Pennsylvania, “and charities want to be right in the middle of that communication.”

Few data exist on e-mail’s ability to produce significant fund-raising results, and the lack of a track record has made many charities reluctant to rush into online soliciting. Disabled American Veterans, in Cincinnati, for example, has begun collecting e-mail addresses but so far has not used them to try to raise money, says Max Hart, who oversees direct-mail fund raising for the charity. “We’re taking a conservative approach to this,” he says.

Nonetheless, more and more groups — from universities and social-service organizations to health charities and public-television stations — are embracing e-mail fund raising. Among the examples:

• The AIDS Foundation of St. Louis. Since March, the charity has raised $30,000 and gained 40 new donors — most of them from outside the St. Louis area — by forming a partnership with an Internet marketing company that sends e-mails to potential donors offering them frequent-flier miles in exchange for contributions.
• Bet TzedekThe House of Justice, a Los Angeles charity that provides legal services to the poor. Last summer it used a concept known as “viral e-mails” to sell tickets to a gala event that appealed to people under 35. The e-mails asked recipients to forward the messages to friends who may not have known about Bet Tzedek. The charity has gained 1,000 new donors through the viral e-mail effort.
• The World Wildlife Fund, in Washington. It has sent an e-mail newsletter to 123,000 people for the past two years and plans to begin sending versions of the newsletter tailored to a person’s particular interests in environmental protection. The charity hopes such tailoring will help encourage more activism and more financial support.

Fund-raising experts say that the use of e-mail to reach prospective donors has a number of advantages over direct mail.

A key benefit is that e-mail allows charities to instantly reach thousands of potential donors who might be unresponsive to postal appeals.

“You’re reaching a whole universe of people who are younger, hipper, more Net-savvy, and not reachable through direct mail,” says Daniel Freedman, who oversees the Web site of Environmental Defense, in New York. The group has 300,000 addresses on its e-mail list — some for donors and others for people who have visited the environmental charity’s Web site seeking information. Through e-mail messages about the group’s projects, Environmental Defense hopes to convert the non-donors into supporters.

Besides allowing charities to reach thousands of people with the push of a button, e-mail also helps charities to become valuable sources of news, which in turn can help them forge close bonds with donors.

Some charities have used e-mail to raise money for victims of natural disasters by e-mailing news flashes to donors. When Stanford University’s president announced his resignation last year, recipients of Stanford learned the news almost as soon as it happened.

“E-mail is revolutionary because it’s instantaneous, it has built-in interactivity, and it allows people to take action or make a gift quickly and easily,” says Mr. Corson-Finnerty of the University of Pennsylvania.

Although sending e-mail is virtually free, starting an e-mail fund-raising effort has some costs, such as renting lists of e-mail addresses. An average e-mail list costs roughly three times as much as a direct-mail list, say experts.

But charities can build their own e-mail lists by inviting direct-mail donors, visitors to their Web sites, and other people to provide their online addresses. By using those addresses to send out appeals, charities can save money on postage, paper, and other supplies, as well as the cost of renting additional direct-mail lists.

Besides offering potential cost savings, e-mail also allows nonprofit groups to transmit carefully tailored fund-raising messages to discrete groups of people who have donated to the charities or asked to receive information.

The World Wildlife Fund plans to begin asking new recipients of its e-mail newsletter to designate which parts of the charity’s conservation work interests them most. Thus, people interested mainly in wildlife will receive information on protecting polar bears from excessive hunting in Alaska and Russia, and people more concerned about pollution will receive information on the charity’s efforts to clean up oceans around the world.

Sending such distinct messages is akin to running “the family store on the corner, where you’d walk in and they’d know what kind of toothpaste you bought,” says Sandra Paul, a fund raiser at the World Wildlife Fund who was hired seven months ago to help propel the e-mail effort. “We’ll know what you are interested in and personalize messages to you.”

Potential Disadvantages

For all of its advantages, however, e-mail also lacks some of the benefits of traditional direct mail.

For one thing, direct mail has been used for years, and charities typically know which lists of names best suit their needs. Because e-mail lists are newer — and because many people switch e-mail addresses frequently — charities that purchase such lists may find that many of the addresses are out of date.

Using e-mail also is viewed by some charity officials as a far more intrusive means of raising money than sending appeals through the postal system. Donors are used to finding unsolicited direct-mail pieces in their mailboxes, but they may be offended if they receive unsolicited e-mails, commonly known as spam, fund raisers say.

“We made a conscious decision not to put out an unsolicited communication,” says Mr. Hart, of Disabled American Veterans. “If we spam them, they might have a bad taste in their mouths” about the veterans charity. “We don’t want to run the risk of turning people off.”

Because of such concerns, most charities are compiling e-mail lists by asking people who already are interested in the organizations’ work whether they want to receive e-mailed information. The process of building such lists is slow, however. So far, the World Wildlife Fund’s e-mail list is only about one-tenth the size of the charity’s total list of 1.2 million people who have contributed to the group in the last 18 months.

Versatile Approach

For charities that are willing to accept the challenges of e-mail fund raising, however, the medium may offer far more scope for creativity and versatility than does direct mail.

For example, at KQED, a public-television station in San Francisco, fund raisers next year plan to send e-mails to donors and a select group of other people in the San Francisco area on the evenings before certain programs, such as concerts, are broadcast. The e-mails will include the programs’ time slot and television channel. On evenings after the programs air, recipients will receive e-mail offers to purchase videos or compact discs of the programs. The fund raisers are now testing whether the post-concert messages should include appeals for money.

The AIDS Foundation of St. Louis has raised $30,000 since March by using Netcentives, an online marketing company that sends e-mails to 4.7 million consumers who have registered to receive e-mail promotions from charities and businesses. In partnerships with the AIDS Foundation and about a dozen other charities, including CARE and Special Olympics, Netcentives distributes frequent-flier miles to consumers who make donations to the charities.The charities purchase the miles from Netcentives, then keep the proceeds from the gifts. Netcentives benefits by selling the miles, collecting new e-mail addresses, and getting free publicity on charities’ Web sites.

One donor gave the AIDS Foundation $10,000, which netted the charity $7,800 after purchasing the miles. But the AIDS group also lost money when another person promised to donate $600, then reneged on the pledge after receiving the free airline miles.

Such abuses are “a definite risk of doing business, no matter what your business,” says John Drew, assistant director of the AIDS Foundation. “But we have not found that the risks outweigh the benefits” of using the e-mail fund-raising approach.

The Glaucoma Foundation, in New York, has sent three e-mail newsletters that have given 3,500 recipients medical and research information. The newsletters have produced only a few thousand dollars in gifts partly because only one paragraph of the e-mails has included an appeal for money. But John W. Corwin, executive director of the Glaucoma Foundation, says the charity plans to use a more aggressive fund-raising message in next month’s e-mail newsletters.

Perhaps one of the most successful ways to raise money through e-mail is to send so-called viral e-mails. Bet Tzedek, the Los Angeles charity, says that its effort to encourage people to forward messages is a big reason its “under 35″ gala raised $750,000 this year, compared with the $98,000 it raised three years ago.

As e-mail becomes a more familiar part of the communication scene, fund raisers are divided over whether to combine it with more traditional approaches.

Mr. Drew, of the AIDS Foundation of St. Louis, does not plan to send postal solicitations to the charity’s e-mail donors. He says he is concerned that unsolicited mail might offend donors who have chosen to communicate with the charity through the Internet. To tap year-end interest in giving, Mr. Drew plans to send donors electronic holiday cards that will thank donors for their online gifts.

But Mr. Corwin says that blending e-mail and direct-mail communication already has paid off for the Glaucoma Foundation. He cites the example of a donor who visited the foundation’s Web site and then wrote an e-mail message to the charity. The donor’s name was subsequently added to the organization’s direct-mail list, and she wound up sending a $1,000 gift. Although the gift came in response to the direct-mail appeal, Mr. Corwin says that the donor probably would not have made the gift without the ability to communicate online with the foundation.

As more and more people begin to use e-mail, such stories are likely to become more frequent. Mitchell S. Hinz, a consultant with Carl Bloom Associates in Garrett Park, Md., who works with KQED, says he has no doubt that eventually e-mail fund-raising will become as ubiquitous as conventional direct mail.

“The big question,” Mr. Hinz says, “is, how fast will it move? It’s either going to be big or huge, but it’s not going to go away.”