Top agency losses put skids under telefundraising

charity new 2The future of telephone fundraising has been called into question following news that the UK’s biggest charity telemarketing agency has gone from making a £1m profit to recording a loss of more than £200,000 in a single year.
According to Companies House, Listen – which became the biggest telefundraising agency in the UK following the collapse of GoGen in June 2015 – blamed a permanent reduction in the size of the market.
A statement in the accounts stated: “2015/16 saw a reduction in turnover from the previous year as a result of unforeseen regulatory changes in the sector, taking turnover back to the levels of 2013/14.
“These regulatory changes have led to what is likely to be a permanent reduction in the size of the telephone fundraising market, but the directors feel that the business now has a sustainable cost base and is well positioned for the future.”
However, the firm can hardly claim to be blameless after a Mail on Sunday investigation accused it of using high-pressure fundraising techniques; a claim that was later upheld by the Fundraising Standards Board.
Listen founder and managing director Tony Charalambides told Third Sector: “2015 was a turbulent year for fundraisers, given the well-documented events affecting the whole sector that summer, but we have since engaged positively and proactively with the regulatory changes and have focused on quality and innovation with our clients.
“Now we are excited to be leading the way with a number of innovations, not least in how telephone evolves from a purely fundraising tool to an engagement device that develops sustainable, long-term relationships between supporters and clients.”
However, one industry insider said: “Is there really a future for charity telemarketing? Given the triple whammy of atrocious practices, negative press coverage, and the looming Fundraising Preference Service, it is hard to see the market recovering. But while some agencies have hardly covered themselves with glory, charities and their industry bodies don’t come out of this well either.
“After all, when the Institute of Fundraising endorses a regulatory approach which is two years out of date, you know everyone is screwed.”
Late last year, MC&C founder and chief executive Mike Colling likened the way charities have used media channels to the “burning and slashing the Amazon rainforest” by going through each channel and burning it out.

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