Charities have adopted a “Primark approach” which means they do not ask for large enough donations, the chair of the Institute of Fundraising said yesterday.
Mark Astarita, also head of fundraising at the British Red Cross, said that charities asked for small donations in order to attract givers, but that this reduced what people felt was an appropriate level of giving.
“We’ve driven down the price of giving to £3 a month,” he said. “We’ve gone for the Primark approach.”
He said this meant that “everyone feels wonderfully generous” even if they only gave small amounts, or only gave occasionally. Although, he said, this approach “isn’t necessarily wrong”.
Astarita was speaking at the launch of Managing in the New Normal, a report by the IoF, the Charity Finance Group and PwC. The report, which was launched at investment company BlackRock in London, looks at how charities have been affected by economic conditions. According to the report, last year 89 per cent of charities had said they expected it to become more difficult to raise money. This year, 68 per cent had said they still expected it to get tougher.
Competition in fundraising
The report highlighted that competition from other charities was the sector’s largest concern, and that more charities are developing fundraising departments, and Astarita highlighted this as a potential problem.
“Everybody wants to diversify their income, and many of them want to start fundraising,” Astarita said. “And why wouldn’t they? The returns are 300 per cent. Why wouldn’t you invest to get a 300 per cent return?
“Competition is bothering people an awful lot, and they are right to be bothered.”
'Generosity seeping out of our country'
Astarita also said donor numbers were dropping.
“The problem we have is that we are having to get increased value from a declining pool of people,” he said. “Generosity is seeping out of our country. A small number of people are doing most of the giving.
“So we need to have a conversation about what type of sector we have in 20 years. Are we still going to be able to engage people in causes? Will we be reliant on government grants?”
He said that tight economic conditions was also making life tougher for fundraisers. “Costs of fundraising are increasing but we aren’t getting inflationary increases in our regular gifts,” he said.
He said charities had been “too optimistic” in the past, although he said this remained the right approach.
However he expected to see some relief in the field of legacies.
“A big increase in shares and house prices is going to lead to a big increase in legacies,” he said.
He said that would be helped by "a big glut of baby boomers" who "aren’t going to live that much longer".
