Myth #1: My donors will hate being called.
This is of course the most common, and probably the most erroneous of fundraising myths. Just because a board member or staff person dislikes being solicited by phone doesn’t mean your donors will. Our experience has shown that as few as 1% of donors called, even on the first call-through of a list, object to the call (and upwards of 25% may contribute to that call). The people who do object can be easily flagged in your database, removed from your calling pool and never called again. It is not uncommon to have a zero complaint level on a list previously called.
In fact, many donors appreciate the interactiveness of the phone call, the chance to ask questions, the personal quality of a phone call, and the ease of giving it provides. Several studies have shown that even those who say “No” to a telephone call are more likely to say “Yes” to a subsequent direct mail appeal.
Myth #2: The telemarketing company will keep most of the proceeds.
A number of less-than-reputable telemarketing companies have convinced organizations to sign up with them on a commission or performance basis that provides only small benefits to their clients. Reputable telemarketing companies operate on a fee-based system that guarantees the rates you pay. For calling programs targeting your most current donors, you should expect a fundraising revenue-to-cost ratio of $3 to $6 raised for every $1 spent, depending on the list and program.
Myth #3: Telemarketing is more expensive than direct mail, so I should just mail instead.
It is true that telemarketing is more expensive than direct mail, and that direct mail should normally be the main vehicle for donor-based fundraising efforts. But this is not to say that direct mail should be the only vehicle. On the contrary, the extra costs are often justified by the extra results and benefits tele-fundraising programs can bring.
Telephone fundraising is particularly effective for conversion to a monthly donor plan (PAC), monthly donor plan upgrades, emergency campaigns, and lapsed donor reactivation, to name only a few examples.
Myth #5: Everybody has cell phones now, we could never get through on the landline.
It is true that there is growing migration to cell phone use. However, as most households still keep a landline active, there has not been a significant drop in the contact rate over the past 10 years. It is also true that in most organizations, donors are middle-aged or older and are more likely to use their landline as their primary phone. In fact, due to the new FCC “no call” rules for commercial marketing calls (non-profits are exempt), we have actually seen contact rates go up, as people are receiving less marketing calls and are therefore more likely to pick up.
Myth #6: There is a large element of financial risk in telemarketing.
This should not be the case. When embarking on a phone campaign always beware of longer-term contracts, or contracts that require a significant amount of financial investment up front. Telemarketing programs are highly measurable and controllable, and should be discontinued the moment the results drop below an acceptable level of response. If your telemarketing company either won’t let you cancel a program at your request or requires long-term contracts or significant minimum charges, look elsewhere.
Myth #7: We’ve tried phoning with volunteers and it didn’t work, so telemarketing is not for us.
Usually what that means is that telemarketing is not for volunteers. First of all, fundraising phoning is a skill that has to be learned. Few people are good at it, and most volunteers just don’t have the time to learn the techniques necessary to solicit funds by phone. An equally important factor in the success of telephone fundraising is the volume of names called. With a volunteer phone team, you simply cannot achieve the volume and, in turn, the results you can with a professional phone bank.
Myth #8: Our donors will not accept being called by a company on behalf of our organization.
While a few donors will be concerned with this, the vast majority will not. Fewer still will even ask you about it.
Myth #9: An outside company will have little sense of what we do, how we work and how to communicate properly with our donors.
Of course, this is a challenge. Few callers will be able to know an organization as well as those who work in an organization on a day-to-day basis. But keep in mind that few telemarketing calls ever vary significantly from the script you’ve approved, and most calls are very straightforward.
There could potentially be some problems, but these can be mitigated in several ways. If you choose a telemarketing company that specializes in non-profit (as opposed to commercial) telemarketing, the callers should have a good sense of how non-profits work and of the concerns donors are likely to have.
Check to see if the company has good employment practices – if so, staff will stay longer and have more experience in handling many types of calls. Ensure that there is an opportunity for your organization to give an in-person briefing and to observe the callers; this also gives you a chance to see if the telemarketing firm provides a reasonable level of training and briefing time.
No caller can be an expert on all issues, but your donors won’t expect them to be. Donors with questions or concerns that cannot be easily answered can be referred to someone at your organization for a response; if your group has a toll-free number, this is especially helpful in re-directing donors’ more complex questions to your organization.
Myth #10: So many groups are calling now, it can’t possibly work.
That’s what they used to say about direct mail years ago – that it had peaked and reached the saturation point. But in fact, while direct mail became more competitive, groups could still make significant profits from it. It has become harder to do, but those who do it well, can still make it work. The same is true for telemarketing. Most donors are still very responsive to a good call about an important cause they support.
With telemarketing response rates at nearly 13% for house files, nonprofits can, and should, be using telemarketing for their reinstatement and appeal campaigns. While the upfront cost of telemarketing can be substantially more than an email campaign or slightly more than direct mail, the increased response often justify the costs (especially for deeply lapsed supporters). Additionally, just because a donor declines to make a gift over the phone does not mean they have declined to make a gift. Studies have shown that those who receive a call are more likely to respond to a second gift ask.