Five-Minute Interview: When Telefundraising, Getting the OK is Key

Recent do-not-call legislation has turned telefundraising into a battlefield. To speak on the current state of soliciting donations through the telephone lines is Jon Hamilton, CEO of Authtel Permission Solutions and president of JHA Telemanagement. Hamilton, a former president of the American Teleservices Association and chair of the Direct Marketing Association’s Telephone Marketing Council, spoke recently at the DMA Annual Teleservices Conference in Palm Beach, Fla.

FundRaising Success: Nonprofits obviously are exempt from do-not-call legislation, but do you think telemarketing programs have suffered in response to confusion about the rules?
Jon Hamilton: There’s almost no words you could say when a person answers the phone to overcome that resistance and confusion. The Federal Trade Commission has not done a good job of educating people on who’s exempt and who’s not exempt. So when a nonprofit calls somebody who has put their name on the national do-not-call list, most often that person assumes they shouldn’t be getting that call. So the call starts on the negative. Any call — whether you are trying to get donations or sell something — that starts out on a negative is always a tough way to go. I don’t think there is anything that’s going to overcome this. I think that people who are on the national do-not-call list are expecting not to get calls, unless they give someone permission to call them. Nonprofits ought to start going out to their regular donors via direct mail to ask for their permission to call them, so when they do call, there’s no confusion or potential negativity.

FS: Many organizations have been reeling from the effects of state do-not-call lists, which allow people to block calls from paid solicitors, including those contracted by charities. How can nonprofits deal with this?
JH: There are some very legitimate companies that have been able to help nonprofits raise millions of dollars every year by what is known as “sponsored” marketing: selling a magazine, for example, where a percentage of the proceeds goes to the nonprofit. It sounds like a scam to the average person, but it isn’t. For the companies that take a percentage of the amount it collects [for a charity], then it depends on the percentage and how much money it is. There are charities that need funds so badly that they’ll sign up with a company that takes 90 percent of the money collected. That’s just wrong. I think a better way to look at this is to ask, “What is this group providing to the charity?” Companies should be able to make a reasonable profit, not just line their pockets while purporting to be raising money for charity.

FS: Has telefundraising for acquisition fallen by the wayside?
JH: Over time, people are going to be less and less angry about telemarketing. When I started in the business 30 years ago, people didn’t mind a phone call. People weren’t mad, because they weren’t getting five calls a night; they were getting 10 calls a year. Now, assuming the exemption for charities stays with us ... nonprofits will become more successful with acquisition again, because people won’t be as angry about the calls. Right now, people who are on the national do-not-call list are a little angry because of the charity calls they’re getting. They haven’t seen nothing yet. Wait until October, when they start getting all the political calls.