Seth Godin, in the recent Gala Economics posting on his blog, stated directly and unabashedly that fundraising galas, auctions and other transactional fundraising vehicles are a “ridiculous way. . .to raise money for a good cause.” Seth was speaking as both management guru and philanthropist. He even went further saying that we can agree on this fact. I certainly do. However, a lot of fundraisers apparently don’t.
Seth makes a number of strong arguments against using transactional approaches to fundraising—some of them familiar: they cost too much, they don’t engender loyalty or a strong identification with the cause. He went on to speak clearly as a philanthropist by stating that these sorts of approaches to raising money are also corrupting—a far more serious and damning indictment.
They are corrupting because they give both hosts and attendees the idea that they are somehow being philanthropic and generous, which they are not. With 75% and upwards of the funds exchanged at these affairs going to event costs, very little is left for the charity. Attendees at these functions are almost always driven by social and selfish motivations not philanthropic ones.
It continues to be my experience that donors want to be engaged not enticed. As a result, most of the attendees at fundraising events aren’t donors. They’re responders simply responding to the invitation to having a good time and mixing and mingling.
As much as donors want to be engaged and asked to make investments, many nonprofits—and their fundraisers—continue to pour thousands of dollars and volunteer hours into enticing responders to attend galas, auctions and like. Nonprofits would be a lot better off if they listened to their donors more while giving in to their emotional attachment to fundraising events less. It’s got to be emotional; they certainly raise very little—loyalty or money.
(This post first appeared on November 15, 2011. It is as relevant today as when it was first published. It is repeated by request.)