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February 10, 2009

Joel Belz’s Bad Advice about Giving

Mail Joel Belz's January 17 World column, titled "Trash it," is factually misleading and potentially damaging to donor-funded ministries. My initial reaction was pretty incompatible with Colossians 3:12-15, so my original post draft, which I submitted to Dave the Swede for feedback, caused him to say, "Well, there's 'scathing' and then there's your post."

Anyhow, I will give Mr. Belz the benefit of the doubt regarding his intentions. But I do very much think that he is out of his depth in this matter of fundraising and donating. His recommendation -- to throw all non-profit direct mail in the trash and focus on giving to a select couple or few ministries (but not in response to direct mail) -- is problematic in two ways:

1. The Math: Mr. Belz provides readers with a "rude surprise" in explaining how direct mail appeals cost as much as they raise. This is supposed to shock and disappoint the reader (and, doubtlessly and unfortunately, has in many cases), leaving them with a sense that non-profits that use direct mail are wasteful. Mr. Belz's description may more or less accurately capture the income dynamics of an initial acquisition mailing, but that is something akin to a "loss leader" advertising strategy. Ministries are reaching out to new constituencies, explaining who they are and what they do, and hoping to find donors willing to join the cause. And many donors do join the cause, and subsequent communications to these supporters returns many times more than its cost. So direct marketing programs ultimately bring in about four times what is spent on them, and direct mail remains the best blend of far-reaching and low-cost -- hardly the wasteful effort that Mr. Belz describes.

2. The Effect on Non-Profits: Mr. Belz says to stop giving to numerous ministries and just focus upon a few. That's great for the non-profits that minister to a popular beneficiary group, like, say, suffering children in Third World countries. Not so great for the non-profits who minister to less popular beneficiaries like, oh, I don't know ... prisoners. I mean, if there is any fundamental truth to all sectors of the economy, it is that market elasticity of demand never favors prisoners, even in the Church. Many of our (Prison Fellowship's) donors give small amounts, and we are very grateful for those generous gifts, knowing that these donors are giving sacrificially and also give to many other organizations. If they heed Mr. Belz's advice, we will lose much more funding than we will gain.

There is also considerable irony that, in the hardcopy World magazine, Mr. Belz's column sits opposite ... yep ... a non-profit fundraising ad! Now, there aren't many non-profit fundraising ads in World, but that is no surprise, as print ad fundraising performs notoriously badly. Compared to print ads, direct mail is the bargain of the century for non-profits.

No, I'm not claiming that Mr. Belz knows that his own criticism could be leveled many times over at his own magazine. I suspect that he simply is not aware of how the two media compare. But that's makes my overall point: Mr. Belz seems very much out of his depth on this matter. And we are responsible for the damage done when we make proclamations beyond our knowledge base. I have had to make my own retractions on The Point when I've realized that I've gone beyond my depth. I, for one, would be grateful if Mr. Belz would do the same in World.

(Image © The Wall Street Journal)

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Shannon K

Interesting article and response. I don't see any good *argument* in Belz's article for giving to only a couple of ministries. He recommends "disciplined" and "thoughtful" stewardship, which I would imagine we're all in favor of, but I see no reason why that should preclude a believer from being "thoughtful" enough to see what God is accomplishing in many different areas of the world and being "disciplined" enough to look into, and give to, multiple ministries if God so leads them.

I identify with Belz's frustration with the onslaught of mailings, though. Of the 10 Christian non-profits that I give to regularly, Prison Fellowship easily ranks in the top 2-3 in frequency of fundraising letters. PF is also the only one that sends me "extra goodies" -- I have on my desk three different sets of address labels and two notepads, all bearing the Angel Tree logo, all from within the last ~2.5 years. (And I'm not exactly a big donor -- I'm a graduate student, so income = not so much :).) This strikes me as excessive, and any time I give money to PF I cannot help but wonder how much of it will finance address labels for fellow donors who could certainly write their own names or notepads for them to use in recording their grocery lists.

But what I find most thought-provoking about this discussion is the idea that a charity has to "market" itself, to keep rallying the giving troops, in order to survive. If we are doing the Lord's work, is it not His responsibility to provide the means of carrying it out? I'm always fascinated when I read old missionary biographies and find how many of them purposed to never ask for money or even hint that there was a need, and how God always provided. In my own giving, I have made a habit of not responding to fundraising letters because I want the Holy Spirit to guide my giving, not the volume or level of urgency of the letters in my mailbox.

Please don't misunderstand me -- I am *not* saying that sending out letters notifying its prayer base of a financial need indicates a lack of faith on the part of PF. After all, Paul wrote to the Corinthians to remind them to give toward the needs of the Jerusalem church, even challenging them with the example of the giving habits of another church. I'm just trying to muddle through in my mind how the Bible's principles and examples of stewardship and giving should play out in a Christian non-profit.

Nathanael Snow

Though Mr. Belz's column might not explain the math well, he is right.
Noted economist Tyler Cowen lays out a similar strategy in his bestselling "Discover Your Inner Economist."
What is important to note is that donors need to monitor the non-profits they support. They need to check up on them, and make sure they are doing what they say they are doing. It is costly to do this sort of monitoring. So, it makes sense to limit the number of charities to the number which you can monitor.
Over diversification of giving can have the same consequences as over diversification of investing. When no one has enough of a stake in an organization to make it worthwhile to monitor, then the organization can steer off course.
As for junking the direct mailers, that also is a good idea. Save the charities' money and avoid unwanted solicitation.

Allen Thornburgh


Thanks so much for the thoughtful comment (AND for being a donor to this ministry!!). This is precisely what I'd hoped to receive.

Let me break out your thoughts specific to mail into two categories you mention: Frequency and Premiums. (Then I'll hit the philosophical matter.)

Frequency: Allow me to just address Prison Fellowship and not other ministries. We are keenly aware of the volume that we currently send out. This program was built, "back in the day", incrementally. So that the question asked was often "Would one more mailing garner more donations, so that we can do more ministry?"

And that answer turned out, often enough, to be yes, so another mailing was added, until, voila, you have quite a few mailings! There is nothing wrong with this; there are no stewardship matters that I see here.

But it does bring up the question: is it too much? Well, I can't say absolutely one way or another, but, certainly, two things are true:

a. We want to keep communication frequencies at levels desired by the donors
b. We want to spend as little money as possible in gathering donations for the ministry

That's why we've done two things in the last few years:
a. Twice per year, we send out Donor Communication Cards by which donors can select their desired frequency and modes of communications.

Additionally, our next generation websites are being designed with "donor control" as a fundamental feature, enabling donors to decide online what kind and amount of communications they want. For now, that can only be done "old school" via 877.478.0100.

b. We've started empirically testing via Longitudinal Communication Streams! Exciting lingo isn't it?! (Sigh ... this only excites *me* ...) What this means is that we test a bunch of frequencies (along with other communications aspects) at once, over the course of a year, to find out what keeps costs lowest AND satisfies donors. For our new donors, for example, as a result of such testing, we've been able to communicate 50% *less* than we previously had just a couple years back.

We are in the midst of setting up similar tests for our other donor segments, all of which will kick off this year.

So help is on the way! We just use this careful methodology to simultaneously keep donations steady ("steady-ish" is more like it, unfortunately) while also meeting the donor desires. But it does take a while to run its course, admittedly.

-- To be clear, in all of these matters, I am speaking candidly for myself here and not officially for Prison Fellowship, even though I lead the ministry's direct marketing program.--

Premiums: Some donors love premiums; some donors very much dislike them. The problem is knowing who likes/dislikes what. If we knew everyone's preferences, we would act accordingly. Unfortunately, we don't.

Now, you and every other WONDERFUL PFM DONOR (THANKYOUTHANKYOUTHANKYOUTHANKYOU!!! ... to the 10th power!) has the opportunity to tell us if you do not want to receive these. If you call 877.478.0100, we can show that you prefer not to get such communications.

In the future, as mentioned regarding frequency, our website will be able to handle such communication customization via "donor control" features.

Lastly, the matter of philosophy. I'm certainly aware of the debate: marketing vs "pray it in". I'm glad you brought up the example from Paul and the Corinthian church. There are others, but that's one of the best ones.

Here's how I, personally, look at this: What matters is "upon whom or upon what are you relying?" If a ministry or its donor engagement program is ultimately relying upon technique or conventional wisdom, then that's wrong. If a ministry or program, however, is ultimately relying upon God to provide, even if/as it employs "best practices", then that is good and right. Because that gives God the opportunity to direct a ministry or program away from "conventional wisdom" when it doesn't comport with his desires for the ministry.

[As an aside, as much as this "upon whom or what are you relying?" issue gets raised with "fundraising", it is just as applicable to ministry program operations. Upon whom or what is a ministry relying in that regard? We need to carry that same standard, that same question, minute by minute into every aspects of our personal lives and corporate ministries.]

I'm getting *really* long-winded here (very sorry), but I'm trying to make sure I answer your thoughtful questions with equal thoughtfulness.

Thanks again Shannon. Please let me know if you'd like me to field any other related questions.

Allen Thornburgh


Many thanks for the great comment. My responsive thoughts:

1. Without knowing Cowen's work, I cannot really comment upon it. If you'd like to explain more, I'd love to hear it.

2. As for over-diversification, you make some interesting points here. I don't find anything problematic with your fundamental argument (that overdiversification can result in poor oversight). But I wonder "how many ministries is too many?" Is it really just three? Hard to imagine.

I also wonder: "How will a donor monitor an organization?" There are some great organizations like Ministry Watch out there (which gives Prison Fellowship great marks as one of its "Shining Light" ministries). There are many others who simply provide overhead ratios, which are horribly misleading.

3. As for your final comment, well ... there's nothing for me to really respond to here. I've made my case as best I can at the moment. If you still feel like you'd rather not respond to direct mail, that's certainly your right. My issue is not with such individual opinions, but with Mr. Belz's global proclamation, which contains the fatal errors I pointed out.

Again, great feedback Nathanael. Many thanks!

Shannon K

Allen, thanks for the detailed and prompt response. I didn't realize you were involved with PFM finances. Now I get to pick your brain :).

I'm glad there's a method to the mailing madness (sorry, can't resist a pun) and that you are working hard to be frugal in your fundraising. I had somehow missed the donor communication cards, so thanks to calling my attention to the opt-out option.

Are the "premiums" you mention the extra goodies? If so, my question isn't whether donors like them or not but whether it is right to send them. To my mind, there are two things I can "get" from giving. 1) A spiritual blessing through the ministry's work if I am in the group it ministers to (Gal. 6:6; e.g., my church or BreakPoint). 2) The blessing of God upon those who give, even if I don't directly benefit from the ministry (Mal. 3:10; e.g., I'm not a starving person in a third world country). I do not see where premiums fit into this. Do you see things differently? Is there a Biblical justification for premiums?

Regarding the philosophy aspect: I absolutely agree that it is vital in every aspect of life and Christian service to rely completely on God and not on our own efforts and wisdom. What I'll have to think a little more about is your implication that using "best practices" can be God's perfect will for a ministry. I tend to view the need for reminders or "best practices" as a result of imperfection on the part of the organization and its donors. Using the example from 2 Corinthians, it sounds to me like they were made aware of the needs of the Jerusalem church and were initially eager to give but later slacked off (8:10-11), because they were not yet "abounding" in the "grace" of giving (8:7). Paul's issuing the reminder was not a lack of faith on his part but an indication of the (as yet) imperfection of the Corinthian believers. They weren't sinning by not giving (8:8 -- this offering wasn't a commandment that they weren't fulfilling), and it is no sin to not yet be fully "abounding" in one or another area of our Christian walk. But if not for the imperfection of the Corinthians Paul's reminder wouldn't have been necessary (8:1-5).

Does that make sense? Thanks again for being willing to discuss this with me :)



Good follow up questions.

Biblical justification for premiums ... hmmm. Well, I'm honestly not sure that I can tie that back to the Bible, per se. Though, you know, I could probably say the same thing for graphics, photos, the use of specific giving opportunities vs general ministry level opportunities ... etc. Meaning, as much as God provides guidance for everything in life that matters most, I personally do not believe that it is a textbook for every aspect of life either. I am among those, for example, who do not believe God intended the Bible to be a scientific textbook, as much as He clearly intended to communicate that the universe, and everything in it, is His creation, and His alone.

It's largely the same with donor engagement (again, in my own humble opinion). We need to be ultimately and unquestionably reliant upon God and God alone. At the same time, what specific best-practices are good vs permissable vs wrong? Well, those that are clearly wrong (misleading claims, false urgency, taking credit for God's work) are generally pretty obvious and can be tied back biblically. Not always so with something as specific as "premiums", I don't think.

It's kind of the same question about tchotchkies (I bet I'm misspelling that) at Christian conventions. Is it wrong for a Christian non-profit to hand out keychains or magnets or (as we did a couple years back) rub-on Prison Fellowship tattoos at a Christian convention? Well ... I don't know ... the intent is to help get the word out about our mission to reconcile prisoners to God, family and community and how others can be a part of that awesome work! And if such tchotchkies and premiums help identify folks with us, and keep the needs of these prisoners front and center in the minds of our supporters, then, gosh, it sure seems good. Permissable at the very least.

As I say (write) that, I have to admit that I wonder how 1 Cor 8 and 10 factor into this? In which we must be careful not to cause others to stumble as we exercise the freedom we have in Christ. I'd honestly have to mull that over a bit ... though I suspect I'd say that this is where customizing our donor communications to donor preferences might be our best opportunity to live up to Paul's standard here.

As far as the notion of the use of "best practices" as being indicative of the imperfection of men (those in ministries, as well as donors), that's an intriguing thought. May very well be true, I really don't know. The same, I guess, could be said for such "best practices" as traffic lights, physical checkups, and oil changes.

You set a high standard with "God's perfect will" here, as well, and I'm not quite sure how to fit that into the conversation. Meaning, when Paul writes of "freedom" and things being "permissable", how does that work vis a vis "God's perfect will"? Over the past decade, I've gone from being a Calvinist to an Open Theist of sorts to, now, a stalwart Perhapsian, as that's the conclusion to which I'm driven by the Word. Does God have a specific precise Will for every single action we take, or is it often more like a range of possibilities and yet remain in His Will? I tend to think it's the latter, with the range being "smaller" and "wider" in different circumstances. So I'm reticent to say "Yes, God wants Prison Fellowship to use premiums ... and he really wants it to be the rub-on tattoo. Definitely not the pens." You know?

Though someday I very well may find out that He does have such specific perfect will at every point. I certainly expect to find out that I've been wrong about a great deal else.

Good exchange Shannon. Thanks for bringing such good thoughts and questions to the table.


Shannon K

Thanks for responding (again), Allen. I hear your point that God gives us principles to abide by and does not micromanage every single decision we make, though I do think His instructions regarding/examples of giving can be applied more specifically than you seem to. But to the extent that we do disagree, I'm happy to agree to disagree :).

I realize my "perfect will" wording was vague. My thoughts were more along the lines of whether these particular "best practices" are ideal (to the extent that there is an "ideal" for Christian ministries, which are obviously each unique) or permissible. If God has made it clear to you (and other financial folks at PFM) that these are what He wishes you to practice or that He is giving you freedom to choose to do so, I certainly don't want to stand in the way of that.

I'm not sure I understand your reference to 1 Cor. 8 and 10. My intent in raising these questions was not to restrict PFM or to criticize other donors (who like getting fundraising letters and not just a standard newsletter), thus potentially causing them to stumble. If I have done so, then I readily apologize. I wouldn't have brought up this discussion (and admittedly somewhat pointed questions) in the first place -- I just saw your post and couldn't resist the opportunity to discuss giving and the financial side of a Christian non-profit with someone else who had clearly done some thinking about it.

Thanks again for the discussion!


Real Quick...

I already clarified matters with Shannon in an email exchange yesterday (not having web access to comment here), but - just to be clear for others - I certainly did *not* mean, by referencing 1 Cor 8 & 10, that the questions she was raising might cause me or others to stumble. Quite the opposite, I was referring to its potential application to the fundraiser. Meaning, could the use of "conventional wisdom"/marketing methods by the fundraiser (say, oh I don't know, moi) cause *others* to stumble? Could my sense of freedom in this matter cause others to stumble, who do not see such methods as permissable? And, if so, how to respond to that?

That's what I meant. Thus, the speculative answer I gave to that question might make a tad more sense.

OK, gotta run... Thanks again to Shannon and Nathanael for the great questions.

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