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The Call for Donor Engagement: Why It’s Time to Rethink Phonathon Fundraising

The Call for Donor Engagement: Why It’s Time to Rethink Phonathon Fundraising 

Phonathon and telefund programs in higher education experienced their heyday in the 1980s and ’90s, as the arrival of database software revolutionized all areas of fundraising. The ability to access large amounts of data quickly, almost ubiquitous landline use, and a relatively stable structure to working hours meant that institutions could recruit a team of students to make phone calls from 6–9 p.m. every evening and reliably forecast raising thousands, if not tens of thousands, of dollars. 

However, as mobile phone usage became more widespread throughout the 1990s and 2000s, enabling recipients to screen their calls, contact rates for the phonathon began to decline. In 2016, Stanford University was one of the first institutions to announce the end of its formal phonathon program, and since then several other universities have followed suit. 

However, despite reports of declining contact rates and ROI, GG+A’s conversations with hundreds of clients and our analysis of their annual giving data reveal that the phonathon remains one of the most powerful donor acquisition channels available to an institution.  

Likewise, those institutions that succeed in optimizing their programs have evolved to embrace a new and improved model – one that emphasizes engagement over transaction. Here’s why implementing an engagement center model could be the key to revitalizing your institution’s phonathon and amplifying its impact. 

Why Did We Abandon the Phonathon? 

Stanford was prompted to reevaluate its telefund based on diminishing returns. In 2011, before the universal adoption of smartphones, for every eight of Stanford’s prospects receiving a call, only one requested to be placed on a “do not call” list. By 2015, that ratio was three to one, prompting the University to question whether these calls were not simply ineffective – perhaps they were actually harming the University’s relationships to its donors and their inclination to give. 

Advancement leaders were equally surprised to discover that when prospects moved from giving via a non-telefund channel one year to a telefund channel the following year, their average gift decreased even when students upgraded their solicitation. Conversely, when donors made a gift online or by mail after initially contributing to the telefund, those gifts increased dramatically. This suggested that donors preferred other modes of giving. 

GG+A’s conversations with hundreds of clients and our analysis of their annual giving data shows that the phonathon remains one of the most powerful donor acquisition channels available to an institution. 

But perhaps the biggest takeaway from this analysis is not that Stanford abandoned its telefund, but rather, that it listened to donors and adjusted its outreach accordingly to center the donor experience.  

Today, the rise of crowdfunding platforms, text-to-give, and online fundraising have provided us with even more insight into the giving behaviors and preferences of donors, and how these have been shaped by smartphone technology. So, while phone calls may have ceased to be the most effective way to secure gifts, this does not mean they cannot play a role in deepening donor engagement, and thereby, fueling generosity. 

What’s Different About the Engagement Center Model 

In a recent benchmarking study GG+A conducted for one of our Canadian clients, the cohort institutions we interviewed were still investing six-figure sums annually into their phonathon programs, in full awareness that this was a long-term investment in donor recruitment, rather than an activity with an immediate payback. 

And one thing was very apparent – a significant number of these cohort institutions no longer saw the phonathon program as a distinct entity, but rather saw the phone as just one tool available to them in a multichannel engagement center environment. As one institution put it:  

For us, “phonathon” is a dirty word. We are the student engagement center, and our team are student fundraisers utilizing a multichannel approach. 

How does the engagement center model differ from the older phonathon model? 

  1. It’s more than just outbound. Yes, students are still making outbound fundraising calls just as they’ve always done, but they’re also taking inbound calls that in the past might have been fielded by Advancement Services or Alumni Relations staff – like address updates and event bookings. A trained fundraiser can make use of their skills to deepen conversations with alumni, maybe not leading to gifts on these calls, but instead augmenting demographic data such as changes in relationship status or employment.  
  2. It’s more than just phone. Modern software designed for an engagement center model allows the fundraiser to seamlessly switch between phone, video call, text message, or email, depending on the preferences of the recipient. And call flow sequences can be designed to send an email, a text, a pre-prepared video, or even an automated voicemail message to constituents depending on the outcome of an attempted outbound call.
  3. It’s more than just fundraising. As we’ve hinted above, the new engagement center model can handle many more kinds of outbound engagements with alumni than just fundraising calls. Many of the cohort institutions we interviewed were already incorporating stewardship for their entire fundraising program into their engagement center workflow, and some were going further – and using the engagement center as a market research and intelligence gathering resource, tracking donor satisfaction, interest in fundraising priorities, and other key issues of interest to the advancement program.  

The blunt measure of participation is becoming less important as a proxy metric for institutions’ alumni satisfaction levels – in fact, alumni giving has now been eliminated from U.S. News and World Report’s ranking methodology for 2024. CASE is successfully arguing that we need a more nuanced measurement of engagement and has put forward a clear set of metrics for institutions to adopt. All of this strongly suggests that an engagement center approach is the way to move forward. 

And we still need a marketing solution that bridges the gap between high-volume, low-cost per interaction, lower-response direct marketing and low-volume, high-cost per interaction, high-response methods like face-to-face fundraising. With response rates to fundraising emails averaging just 0.09%, digital outreach alone can’t bridge this gap.

What’s the bottom line for institutions that are unsure about their investment in the phonathon? We need to stop thinking in terms of the instrument – the phone – and start thinking in terms of what that instrument enables – mass person-to-person interaction. In short: engagement.  

Adrian Salmon,Vice President, has more than 25 years of fundraising experience across higher education, arts and culture, and the wider nonprofit sector. His expertise includes digital engagement, stewardship, direct mail, annual giving program management, and multichannel appeals. To connect with Adrian about your organization’s donor engagement strategy, email asalmon@grenzglier.com.

And for more from our consultants on enhancing donor engagement, download our playbook, Centering the Donor Experience.

 

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About the author

Adrian Salmon

Vice President

Adrian Salmon, Vice President, GG+A Europe, brings 25 years of direct-marketing fundraising experience in the higher education, arts and culture, and wider nonprofit spheres. His particular expertise includes digital engagement and stewardship, direct mail fundraising, annual giving program management, and management of contributions from integrated mail and online appeals. Before…

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