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Call that a crisis? This is a crisis.

By Sean Triner

“Good luck in reaching your target. Having just given birth to a beautiful daughter who is happy and healthy, I thank my lucky stars all the time. Kindest and warmest thanks for all the work you do.” A donor responding to the Starlight Children’s Foundation crisis appeal.

Starlight, the Australian children’s charity which helps thousands of kids in hospitals around the country was in suffering from the negative impact of the economic downturn.

Attractive to families of kids in hospitals and a great brand for corporate sponsors to associate themselves with, Starlight’s event and corporate fundraising staff had helped grow the charity for 21 years.

But when the Australian economy began to wobble, these were the first fundraising ‘products’ to falter. At the same time, Starlight had stretched itself to try and reach more kids, more effectively – but something had to give.

“Over the past 10 years, Starlight has grown extraordinarily and much of our income growth has come from corporate support, community fundraising and events” Jill Weekes CEO explained “we have grown our services at the same rate as our income and these income streams were immediately impacted by the economic downturn. Whilst we had recognised for some time we would need to grow our ‘individual giving’ income, this downturn has meant the imbalance in our income streams needs to be addressed urgently and we have had to review our fundraising structure and strategy to achieve this as a key priority for the entire organisation.”

Starlight went into crisis aversion mode – if they were to survive, they had to cut costs and cut costs fast. And that meant people; people delivering services.

Because of sharp warning systems and a board and management willingness to act fast, Starlight will survive. And the lessons learned will help grow a fitter, healthier organisation better placed to deliver services in the next decade.

A few years ago, the management and board knew they had to diversify fundraising sources – they had seen the growth of other charities through individual fundraising. At first put off by the sheer cost of building individual fundraising, a series of tests by fundraiser Caroline Rowland proved the value of this area of investment.

But they were in a classic chicken and egg charity catch-22. To become a secure, solid charity with a more diversified, solid fundraising portfolio they would need to invest in individual fundraising, especially donor care and regular (monthly automatic) giving.

Head of Partnerships, Anne Johnston was keen to continue the development work. Along with the board and management, they decided to take the challenge head on with complete transparency.

To alleviate rumour, and show full respect to their beneficiaries, staff and donors they went public with their woes and put in place a plan to shift their fundraising along a gear or two; but they couldn’t avoid redundancies. A press and fundraising campaign was launched in April 2009.

It was at this point that they approached Pareto Fundraising – initially to look at long term donor development. But the press were responding really well to the story, and whilst their plight was high in the news they decided to take a gamble and change their usual approach immediately.

With about 40,000 people who had supported Starlight in the past few years, Pareto Fundraising advised that they go out with a direct appeal to them for help. An appeal was put together in record time to take advantage of the media. The approach was incredibly simple.

The CEO, Jill Weekes, agreed to bare all in public. A strong, honest, incredibly personal and direct letter was sent. In support of the letter were incredibly simple pieces all thrown together in Microsoft Word.

We pulled headlines from newspapers and stuck them on a piece of paper, photocopied it and had one piece. Another consisted of very simple overviews of four of the services affected by the cuts and finally, a copy of Jill’s statement about the cuts (which she had published on the web). An emergency reply envelope was also produced.

Targeting showed that two waves (i.e. mail twice) to fewer donors would probably make more money in the short term but the crisis was seen as an opportunity to reactivate lapsed donors and test out groups of supporters who wouldn’t ordinarily give to mail appeals. Even in the midst of a crisis, Starlight fundraiser Caroline had her eye on the long term.

However, the targeting identified 285 very high value donors who would get the special treatment. They got the appeal sent in an Express Post envelope – always a nice surprise for people, Express Post costs close to fifteen times as much as normal charity mail but we figured these people were worth it.

Starlight staff also committed to calling as many of them as they could with a highly personalised phone call, asking them about the appeal and reminding them to donate. Unfortunately illness and other reasons caused a delay on some of those calls but an impressive 75 donors had engaging conversations and all were supportive.

“While of course it’s difficult to get hold of people, those donors I spoke to were generally happy to hear from me as I first thanked them for being such wonderful supporters. Most donors I spoke to indicated they would make a donation.” noted Anne Johnston, Head of Partnerships.

The next few thousand received the mailing in a larger envelope and all the others in standard charity mail envelopes.

There were nowhere near enough email addresses for email to figure within the campaign strategy but we did put the appeal up online with prompts to it from the home page. More of a branding issue than a fundraiser. We felt that writing to people with such a strong campaign, and then not mentioning it on the homepage was disingenuous.

We also knew we were shooting from the hip – reacting fast to an opportunity without having put the strategy to bed. But after drafting the letter and reading it out loud we all knew whatever the medium and long term strategy, this was the right thing to do right now.

Through clever cash management and planning, Starlight managed to find more budget to mail a second wave too. That additional investment will help end the debate on net v return on investment (ROI) for Starlight. Whatever the ROI, the additional net income was what Starlight needed.

When the mailing went out, all were nervous. It went out really, really fast. There was no Johnson box (a bit of extra copy, like a teaser, above the salutation) and the use of bolding and underlining was minimal. We wanted it to look rushed, but still wanted it to perform. Which worked well, because it was rushed and we did want it to perform!

”There was a lot to do and too little time to do it all in – between pulling together the most relevant donor lists, finalising the letter and lift pieces – which had to be approved at board level due to the ‘bare it all’ approach, briefing everyone in the organisation and all our key supporters, it was a frantic time. But we knew this was absolutely the right thing to do and were so motivated by the chance to raise funds that would help save our services for seriously ill children and their families” Caroline Rowland, Starlight Relationship Fundraising Manager explained.

Pulling it together so quick also had implications for project management; the Starlight team were already stretched coping with the impact of the downturn to the organisation overall and Pareto Fundraising was at capacity with ‘booked in’ tax appeals for other charities. The team of strangers was pulled together with little notice and thrown together with no induction or time to get to know each other.

Everyone in the team was nervous. Pareto Fundraising had experience of crisis mailings – but never before with something so upfront and honest in a global financial crisis. Tests abroad had shown that mentioning the financial crisis could even harm appeal mailings.

For context, we had the element of last year’s tax appeal that was sent to warm donors. With limited acquisition since then, the number of ‘hot’ donors Starlight had available to mail was dwindling but we needed to do better. Last year the warm appeal raised $320,000 – a tax appeal record for Starlight. This time we wanted $500,000 – over 50% more, in the midst of a global financial crisis.

“For Starlight the Crisis Appeal was a turning point, the immediate team were convinced we needed to do this and that the result would change our fundraising structure forever. We were delighted to be working with Pareto Fundraising and their confidence inspired ours – but it was a risk, we had to convince the board, the internal management team and our core supporters. We were relative newcomers to the arena of personalised direct marketing and had no illusions about this; would we get the response rates and income we hoped for? We didn’t know, but we knew we had to try”. Anne Johnston, Head of Partnerships comments.

As soon as wave I landed a flood gate opened. Thousands of dollars rolled in, and the first week had everyone smiling and optimistic. But quickly it dropped off to normal levels. The deadline for donations was 25 May, about two weeks after mailing, and by deadline we had broken all records; but income was $370,000 – still short of target.

Not bad, but not that exciting neither – and not enough to begin to bankroll Starlight’s investment in a more secure future.

But bizarrely, the weekly income just didn’t drop off.

In fact, it kept coming in so long I delayed this article.

To date Starlight has raised $650,776. That is 105% more than last year. The first wave alone raised $515,000.

Of the 285 top donors, 20% (58) donated an average of nearly $2,000. With 3,800 people donating (nearly 10% online) Starlight managed to begin a warchest for future fundraising, reactivate hundreds of donors and engage with nearly 75 major donors. Most donors gave more than they ever had before.

The strategy is now in place, and the major donors will be approached one on one to say thank you, and further engage with face to face major donor asks. Other donors are being approached to become regular givers – we telephone, thank and ask for ongoing monthly gifts from bank accounts and credit cards.

“We kept the whole organisation and our board informed of progress throughout the appeal, when we hit the $500,000 target it was just the most amazing vote of confidence for everyone – people working in a charity care about the work they do emotionally as well as professionally – so you can imagine the difference this extraordinary success made to our team’s morale – now we could focus on how we rebuild for the future.” Anne Johnston explains.

A sterling team effort from fundraisers, board and management at Starlight made all of this possible. I have seem so many project ideas like this come a cropper because of individuals’ pride or fear that donors will somehow blame them. In this instance, from Chair and CEO downwards, their courage was rewarded out with a swelling of the cash that is allowing Starlight to invest in the kind of fundraising that will make another crisis so much more unlikely.

All well and good, but having read this far, you want to see the letter don’t you?

Click here where you can read and download wave I full pack and the wave II letter.

The twelve pages / elements of wave I are where the hard work was done, but of course we can improve on it. But check out the wave II letter as well – a great tip for producing an incredibly cheap and effective follow on. The wave II letter was accompanied by the same materials as wave I except we didn’t send the newspaper cuttings again.

Classic, direct mail still rocks in the twenty-first century.

“I sincerely hope this heart warming foundation can continue to shine light into the dark and frightening world inhabited by ill children. I am happy to do what I can.” A donor responding to the Starlight crisis appeal.

Starlight Crisis Appeal Team

Caroline Rowland, Relationship Fundraising Manager – individual giving project manager at Starlight
Sarah Young, Collateral and Website Marketing Manager – web marketing and project assistant at Starlight
Naomi Byers, Account Manager – project manager (wave I) at Pareto
Justine Mathieson, PA to director at Pareto Fundraising – crash course in old fashioned cut and paste (with scissors and glue) graphic designer
Sharon Tillman, Account Manager – project manager (wave II) at Pareto
Andy Tidy, Senior Data Analyst – data guru at Pareto Fundraising
Anne Johnston, Head of Partnerships – bore the responsibility for budget, signoff and the whole gamble at Starlight
Fiona Paterson, senior consultant – Pareto Fundraising consultant, peer support for strategy and proposals
Ian Kennedy, the father of Australian Direct Marketing – Starlight Board Member champion who encouraged us all to ‘just go for it’
Sean Triner, Director – strategy and copywriter

About the writer

Sean Triner is co-founder and director of the international Pareto Groups of companies, one of Australia’s most dynamic fundraising and marketing agencies with offices in Australia, New Zealand, North America and Hong Kong. Never afraid to cause controversy, Sean is a popular presenter at some of the world’s best known conferences including IFC in Amsterdam, FIA, IWRM and DMAW. He also regularily contributes to fundraising publications globally.

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