Adapting to the new data world
The last few years have been a roller-coaster ride if you work in or around a charity, especially in fundraising. The 2015 fundraising crisis and subsequent regulatory changes in law and the Code of Fundraising Practice saw the common practices of selling, renting and swapping supporter data, and cold telephone fundraising, quite suddenly disappear. The sudden loss of such major cold data sources has had a huge knock on effect for how charities recruit new donors and fundraise, especially when using direct mail.
Cold data is defined as information about an individual who an organisation does not have a pre-existing relationship with – in this context, name and address data. While cold data can still be used perfectly lawfully (see the ICO’s Lawful Basis for Processing), it’s fair to say that in the charity sector there’s been a great deal of confusion around what data can and can’t be used, when and how; compounded by the impending GDPR and decisions around whether to use Legitimate Interest or Explicit Consent in fundraising communications.
Understandably, many charities have withdrawn from using cold data direct mail altogether. The majority did so, not necessarily because cold direct mail didn’t work for them, but mostly because of initial worries over risk to reputation post the negative media reports and debates around over mailing and data swapping, and since then, largely because of the confusion around compliance issues.
You may be surprised to hear then that some charities – having now incorporated the new best practice standards into their use of cold data – are seeing the same pre-2015 high levels of performance, even without swapped data. Others are even seeing an improvement in overall performance via cold direct mail, albeit perhaps because there are fewer participants in the market.
Charities will always need to reach out to fresh new audiences, but of course, in the right way. Cold data is available and can be used appropriately: not only lawfully but also respectfully in terms of message, tone, and frequency of contact.
Swaps and rental of charity derived data are long gone, but for charities there are options for accessing cold lifestyle data and mail order buyer data with a higher propensity to support a particular cause. These are defined as:
• Lifestyle data – ‘profile selections’ (finding look-a-likes of existing donors within lifestyle databases when you don’t know exactly which lifestyle criteria they have).
• Lifestyle data – ‘manual selections’ (whereby you define the criteria for the individuals you are looking for).
• Mail order buyers – people who like to respond via the post; the vast majority of mail order companies use direct mail to keep customers warm, even if this was not the original channel of recruitment or response.
There are now much stricter requirements for sourcing and using cold data; there are safeguards that must be in place and due diligence to be carried out.
What to look out for when sourcing cold data
Firstly, check that any data broker, list manager or database owner has passed the DMA’s Data Compliance Audit. This is run by an accredited third-party data auditor as a thorough, paid-for audit with a requirement to demonstrate regulatory compliance.
Then, before renting cold data for direct mail (be aware that the rules are different for email and telemarketing), you must also ask a series of questions:
• Who compiled the list?
• When was it compiled?
• Has it been amended or updated since then?
• How often is it updated?
• When was consent obtained?
• Who obtained it and in what context?
• What method was used – e.g. opt-out?
• Was the information provided clear and intelligible?
How was it provided – e.g. in a clear statement next to the opt-in box, or at what stage in the call?
• Has the list been screened against the MPS, TPS, FPS or other relevant preference services?
If so, when?
• Has the individual expressed any other preferences – e.g. regarding marketing calls or mail?
• Where geographically is the data coming from and to be used? (There are different rules for data from or going to beyond the EU)
• Has the seller received any complaints?
• In ensuring that your obligations are met, can you maintain and apply a 'suppression list' of people who have opted out or otherwise told your organisation directly that they do not want to receive marketing from you?
• Is the seller a member of a professional body or accredited in some way?
• What is the ICO registration number?
Not only do you need examples of the permission statements used, you need to decide if the permission is good enough (for example, pre-ticked boxes are invalid under the upcoming GDPR), and if the statement is easy enough to find.
For me though, the biggest shift in working with and trading data is that the list owner ought no longer to consider themselves its ‘owner’. Instead, they are now a ‘facilitator’, because the fact that you have an individual’s name and address doesn’t mean you can do what you like with it. The same goes for charities using that data. You will need to carefully consider your usage, ensuring you’re well within the guidelines set in the Code of Fundraising Practice.
In the world of GDPR from 25 May onwards, it will be important to understand which legal ground is being used for processing the data. Also, whether, at least in the case of legitimate interest, the ‘owner’ has undertaken a balancing test between the interests of the data owner and the consumer. The IoF and Fundraising Regulator explain more about these legal grounds in their joint GDPR and Charitable Fundraising Guidance.
If building your supporter base is important to your charity, you can still use cold data, both respectfully and sensitively. The market remains volatile so it’s key to be agile and ready to adapt but what’s clear, is that the picture isn’t as black as it’s sometimes painted – there is promising potential for leveraging cold data in our fundraising for great results, for both charities and our new supporters.
Suzanne Lewis, Managing Director of EDM Media UK and IoF Insight in Fundraising Special Interest Group committee member