STATEMENT of The Direct Marketing Association Nonprofit Federation RE: Charitable Giving Reports

NEW YORK AND WASHINGTON, DC, December 22, 2004 – The Direct Marketing Association Nonprofit Federation (DMANF) today is reviewing a just-released report that attempts to measure nonprofit efficiency based on a small number of telemarketing campaigns in the state of New York. We are pleased to note that the report acknowledges there are legitimate instances where the financial efficiency of a specific campaign does not tell the full story.

In 2003, nonprofit organizations used telephone solicitations legitimately to collect $66.5 billion for worthy causes. By far, telephone remains the most successful and one of the  most efficient methods for legitimate charities to carry out their critically important work.

We agree with NY Attorney General Eliot Spitzer that it is incumbent upon nonprofit organizations to solicit bids in advance of contracting out with a professional fundraiser.

However, the decisions to work with a professional fundraiser must be based on the specific goals and objectives of the nonprofit, which may range from advocating, to raising funds, to building awareness, or even to educating the general public.

In many instances solicitations are made for purposes beyond just fundraising, as Attorney General Spitzer points out in his report's caveats, listed below. There are reasons why some campaigns may be more financially successful than others.

"CAVEATS: In reviewing the data in this report, the reader should keep in mind several factors that may affect fundraising costs. Identifying new donors may be more time consuming and thus more expensive than contacting prior contributors. An organization may conduct a telemarketing campaign simply to test-market new fundraising ideas without any certainty that its campaign will prove efficient and productive. An organization may also achieve goals other than raising funds - such as public education or recruitment of volunteers - at the same time that it is conducting a fundraising campaign. These and perhaps other benefits will not necessarily be reflected in the revenue received by the charity.

A newly created charity or one advocating new programs or new ideas may experience greater fundraising costs without any certainty that its campaign will prove cost effective. The reader should also keep in mind that amounts raised in a particular telemarketing campaign may represent only a small part of a charity’s fundraising activity and, therefore, may not provide donors with a complete picture of a charity’s overall fundraising. Donors are urged to review the entire annual financial report of a charity when considering making a contribution and should not rely solely on this report when making such decisions."[1]

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