Outsourced Telemarketing for Charities: Fundraising that Compromises Public Generosity

Not many of us answer calls from unfamiliar numbers these days, but if we do, there's a good chance a telemarketer is on the other end. Though most of these folks are peddling products, some are actually soliciting donations for legitimate charities or not-for-profit organizations. And especially after 9-11, Americans are willing to donate to organizations that seem heroic, like police and firefighter groups. But there's often a dark side to these requests for support - they're typically handled by an outsourced telemarketing firm. Xentel, Inc. is one such greedy company.

Outsourced fundraising companies like Xentel evince a gigantic flaw in the world of charity. Because most people tend to give money only when asked (rather than proactively making donations), an immense amount of public generosity is wasted on marketing. Or in this case, telemarketing.

Of the millions of dollars that outsourced telemarketing companies like Xentel collect from average Americans who give money when called upon, only a fraction of those funds actually go to the organizations people think they're supporting. Sadly, many charities agree to let telemarketing companies handle their campaigns because these outsource firms will still earn them more than they could have earned on their own.

Why? Because these firms have the infrastructure to make lots of fundraising calls. And they've pared outsourced telemarketing for charities down to an eerie science. That's something state and local charities could not do with their own limited resources.

Imagine these two hypothetical (but realistic) scenarios: