Bluefrog closes as founder slams charities' AI obsession

Bluefrog Fundraising, the third sector agency which can trace its roots back nearly 28 years, is shutting up shop after what founder Mark Phillips calls “fundamental shifts” in charity marketing, including an obsession with AI and a pointless drive to target Millennials.

The agency was originally launched in 1997 as Bluefrog Ltd and over the years has worked for the likes of Care International, Childrens’ Society, Marie Curie Cancer Care, WSPA and Sense.

However, this business went into liquidation back in 2017. The main cause was a £2.1m VAT bill from HMRC for so-called single sourcing of direct mail, a one-time legitimate practice which pooled costs like print, production and post so charities and agencies could avoid VAT.

However, when HMRC changed the rules, many agencies found themselves with huge bills and no funds to pay them. At the time, the DMA mounted a campaign against the changes but for some, including Bluefrog Ltd, it was all too little, too late.

Philips then set up Bluefrog Fundraising; a move which drew some criticism but is perfectly legal. However, now Philips has decided to close the agency altogether.

In a video on LinkedIn, Philips states: “After 28 years riding the agency rollercoaster, it’s now time to say goodbye to Bluefrog. This isn’t a decision I have taken lightly, I have thought about it for a long time.

“Partly, it’s personal. I’m getting older and I want spend more time doing the parts of the job that I love, like developing strategy and uncovering insight and developing effective creative ideas. And I want to spend less time managing a business.

“I’d also quite like to take a holiday now and, as the politicians are apt to say, see more of the family.”

Fundamentally, however, Philips also said the main reason for his decision were shifts in charity marketing. He explained: “Never have I seen such a strong appetite from clients for fundraising approaches that are new or different – when new or different isn’t what they need.

“To be clear there is nothing better and more enjoyable for me in my job than to come up with something new or different. But fixing things that aren’t broken? It goes against the commitment I made to myself and to the sector.

“The fact is we have an ageing population but there is this persistent drive to crack Millennials, despite the clear evidence that this group lacks the financial capacity and life experience to give at scale. Their time will come; just not yet.”

Philips goes on to challenge the obsession with AI-driven marketing, insisting that the clue is in the name. “It is artificial and not based on real insights.”

He added: “I have to accept the times they are a’changing. And, so for us, maintaining that full in-house team of researchers, writers, designers, artworkers, account handlers, and support staff is increasingly making less and less sense.

“And I have no desire to lead the kind of agency that is becoming increasingly common, that simply acts as a type of middleman, leaning more and more on AI or outsourcing work to a raft of ever-changing freelancers, whilst charging clients a premium.”

However, he is not hanging up his boots just yet and plans to launch his own consultancy, Mark Philips Fundraising Associates, in the coming months.

He concluded: “I am building a new model focusing on the research and insight that so many found so valuable, as well as creative work that can shape organisations. They are the kind of ideas that are way beyond the reach of AI, because it simply doesn’t have the knowledge or the feelings or the creative intuition that’s required.”