A Realistic Look at Annual Funds

These canvassing efforts began to decline about 35 years ago, and they’ve rarely been really successful since, though many variations on “special events” continue to offer volunteer fundraising opportunities. One of the causes of the decline in volunteer canvassing was the introduction of an easier, better way to do annual giving — direct mail.

Direct mail made its debut in the late 1940s and ramped up slowly as the “better way.” In the 1960s, the ZIP code provided new tools for targeting. But, the real explosion was caused by the computer in the 1970s with the advent and growth of the digital database.

Computers enabled direct mail to really take off. Canvassing became much easier and much broader. There were few geographical limits that could not easily be bridged. And volunteer efforts began quickly to shrink because the “return on investment” was simply not competitive.

Direct mail expanded the reach of the annual fund beyond the local community. And it raised the stakes, and the take. “Participation” became an art and a very big concern. Annual fund goals — and numbers of donors — skyrocketed with direct mail. A new “science” of direct marketing for philanthropy was born — how to write a letter, better BREs, live stamps, graphics, personalization, segmentation, teasers on the envelope, etc. It all got more and more elaborate and sophisticated.

Direct mail worked very well, and it grew quickly for a couple decades. In the 1980s direct mail quadrupled, then doubled again in the 1990s. The drivers for this growth were technology — we moved from the mimeograph to the offset press, then to the web press, then to high-speed computer printers and more recently to color printers, etc.

Dynamic electronic databases replaced the static addressograph, making many new approaches possible. It took us from “Dear friend” to “Dear Sally and Joe.” Automated stuffing, live stamping and NCOA were factors. Analytics and modeling took us even further, and we began to gather more and more seemingly “trivial” information to drive better targeting. Some nonprofits were able to support their entire operations from annual giving. The sky seemed like the limit as we bought, rented and exchanged lists, and got better with the analytics, segmenting and targeting.