Why do non-profits sell or rent their donor names and is it ethical and right? I have been following a wonderful discussion on LinkedIn regarding these activities with donor names by non-profits. This has been accompanied by two excellent posts on the issue, which you can find here and here. I will admit, when I was on staff, the organizations I worked for rented and sold donor names. In the years since I worked at these non-profits, Facebook was established and took off, as were so many of the social media tools which are prevalent today, such as Twitter, YouTube, Tumblr, etc. Information is now vast and easy to obtain.
In the eight years since I held my last staff position, social media has exploded and Eric Snowden and the NSA became familiar to us. With the passing of each month and year more and more of our lives have become public, there is an ongoing debate about privacy and what that means and we have come to know in detail that Corporate America and governments alike are capturing immense amounts of meta-data on us in order to better target their marketing efforts or track our movements.
So, why do non-profits rent or sell their donor names? The dirty, naked truth is because they are seeking to grow their own databases and fundraising dollars and, sometimes they are seeking to purge or suppress off their rolls any names they may have which are not performing. For example, when organizations analyze how much it costs to continue to reach out to a donor who has not given in, say, three or five years, it may be more effective to sell or rent the name thereby suppressing future outreach to them, including the cost, and then proceed to obtain new prospects for whom their might be an affinity with the organization’s mission. There is a whole art and science to this marketing, which by the way is also done in the for-profit sphere. That is how you end up receiving solicitations for publications you never subscribed to in the past.
As both of my colleagues stated in their respective blog posts on the issue, the Association of Fundraising Professionals (AFP) permits this in their ethics. But, I lend my voice to what my colleagues have stated and this must change. Donors need to have an easy opt-out, but preferably, an opt-in.
I know some of my non-profit colleagues may debate me on this issue and may explain that by renting and selling information the sector is raising all boats because if organizations are better able to target and increase their revenue and minimize wasteful expenses, they are then better able to grow their footprint as it relates to their mission and do more for a greater impact. That is all well and good, but the fact of the matter is that opt-in and opt-outs have become best practice in the for-profit sector. Typically, when I sign up for something these days, I am able to see privacy terms and I am able to opt-in or opt-out. In 2012, the Federal Trade Commission (FTC) issued a report entitled “Protecting Consumer Privacy in an Era of Rapid Change: Recommendations For Businesses and Policymakers,” as it sought to advocate for the greater protection of consumer information. As we all know, where we provide our information can have real world consequences and we should have a right to have the option to participate or not in the renting and selling of our information.
There is also another factor that perhaps donors are not very well aware of in the industry. Sometimes, fundraising professionals ask their best donors for names and contact information of individuals who might be potentially become a prospect for the organization. These names are then added to databases, which then result in people receiving solicitations from non-profit organizations. And, in addition, people who never requested to become part of the database in the first place are then at risk of having their name and contact information sold or rented to yet another organization.
Besides the ethical question, in today’s environment where information is much more public due to the power of the internet and the use of social media, among other factors, this renting and selling of names can actually be counter-productive. As donors become more sophisticated and aware with regard to how their personal information is shared, if they find out their information is being sold or rented, they are likely to be angry and feel misled and betrayed. This does not benefit any organization. Transparency and opt-out or opt-in options on donor information are not only ethical, but it also makes good business sense.