Friday, January 23, 2009

US retail giants learning from the charity sector?

Maybe not, but that’s the spin that I briefly took from a recent Economist article about retailers such as K-mart and Sears moving towards - or back to - offering layaway (or lay-by) payment schemes.

For those not familiar with how a layaway or lay-by scheme works, it’s simple. When you purchase something, instead of paying cash or credit, you make regular (maybe monthly) contributions towards the goods until you pay it off. Then when you have paid it off, the goods are yours, but not beforehand. Sound familiar? It’s kind of like monthly/regular giving but there is a fixed period (assuming you make all of the payments).

So what the hell has this got to do with my fundraising program I can hear you saying?

Well it got me thinking of the parallels behind what we’ve been witnessing with our clients at Pareto Fundraising and the shift that some retailers are making right now.

The benchmarking work that we’ve been doing in recent times has very clearly shown, not surprisingly, that organizational income has dropped over the last year but individual giving continues to grow. In particular, monthly/regular giving is going from strength to strength.

Regular donors are a resilient bunch, we know that. Especially if we treat them well, update them, continue to ask etc.

In fact not only are we seeing growth in the value derived from existing monthly/regular donors, but we’re also seeing clients experiencing incredible success recruiting new donors straight onto a monthly/regular gift, for some better than ever before. For tips on this visit my earlier post about becoming smarter in our acquisition efforts.

The point of this rant?

To remind us that monthlyy/regular giving can still be a good investment, even now.

To let you know that income from monthly/regular givers for many organizations around the world is growing.

To share with you that it is still possible to recruit monthly/regular givers successfully.

And to let you in on a little secret that even retailers are cottoning on that an old fashioned practice such as periodic payments isn’t so old after all.


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