Latest Sick Kids Campaign Puts Fierce New Face on Acquiring New Donors

On October 14, 2016, the Globe and Mail published a story, New, flashy SickKids advertisement aimed at untapped donors.

Where, I thought, as someone who has worked in the charitable sector for 25 years, could the untapped markets for the Sick Kids Foundation be hiding? If Torontonians were asked to name one charity, they would like likely respond by naming Sick Kids Hospital. Sick Kids is not only the default children’s charity in Toronto, it is the default charity. Period.

Yet, here was the Foundation spending $2 million on one of its campaigns to generate a bigger share of the donor market. And they’re feeling pretty bullish.

“We’re looking to transform SickKids from a cause brand to a performance brand – what we’d classically see in the Nikes or the Under Armours of the world,” Jay Chaney, chief strategy officer at advertising agency Cossette, which created the new ads, is quoted as saying in the story written by the Globe’s marketing reporter Susan Krashinsky.

This new campaign comes just after two record years of donations and is Cossette’s second campaign for the Foundation.

Charities are, of course, free to spend significant sums of money on acquiring new donors. Many justifiably do. But the amount of money Sick Kids spends is part of a troubling trend where large charities (especially large hospital foundations) are spending the kind of money other charities have no appetite or capacity to spend to blast the competition out of the water or, as some say, breathe in all the charitable oxygen.

From 2006 to 2015, the Sick Kids Hospital Foundation spent $480.0 million on fundraising, advertising and promotion, 42% of the $1.21 billion they took in from fundraising during that time. Ninety nine percent of that was spent in the Toronto market.

By way of comparison, the Canadian Red Cross, which operates nationally in two official languages, spent $234.0 million on fundraising, advertising and promotion and generated $1.03 billion in fundraising revenue. Those expenditures amounted to 22.7% of the fundraising revenue.

Another nationally known charitable brand, the Salvation Army, spent $227.3 million on fundraising, advertising and promotion or 25.1% of the $905 million they raised in fundraising between 2006 and 2015.

For the past ten years, the Sick Kids Foundation has out spent large national charities by a ratio of more than two to one.

The question is why is Sick Kids trying to expand its market so aggressively? Their balance sheet history shows that the Sick Kids Foundation is not even spending the money they do have.

Over the past ten years, the Sick Kids Foundation raised 132% more than it has spent, a surfeit of revenue over expenditures that has allowed the organization to build up non-capital assets of $1.05 billion, made up largely of donor-directed funds.

In comparison, the Canadian Red Cross raised 107% more than it spent over the same ten-year period and holds onto $186 million in non-capital assets.

While it’s important for a healthy charity to have reserves, why do foundations that exist to support publicly funded acute care hospitals feel it’s appropriate to build up massive amounts of “dead money” as it would be called in corporate Canada?

And then use that money to outspend comparative national charities by a two-to-one ratio so they can raise more money?

It begs the most important question of all. How are the needs of Canadian children being met with this strategy?

While Globe reporter Susan Krashinsky does point out that Sick Kids is launching this attention grabbing campaign after two record-setting fundraising years, the broader issues around the priorities of the Sick Kids Foundation and other large charities often goes unreported.

While most media outlets typically sink their teeth into the headline grabbing charity stories about salary and fundraising costs, the need for any sort of in-depth analysis of how the charitable sector is actually benefitting the sick and marginalized goes unanswered.[1]

And, sadly, at least to this charity veteran who cares deeply about the unmet needs of hundreds of thousands of vulnerable children in this country, media outlets often act as de facto publicists for charities such as Sick Kids.

The Sick Kids Foundation itself could have written the news stories about the latest Sick Kids fundraising campaign. (And if we look at the similar headlines that may be, in fact, the literal truth and the copy is just pulled from Sick Kids’ media releases.)

The Sick Kids Foundation is not alone in their comparative two-to-one expenditures on fundraising and advertising. The Princess Margaret Cancer Foundation, for example, spent $407.3 million from 2006—2015 to raise $1.13 billion in the same time frame.

In 2013, I wrote about the media’s kid-glove treatment of that charity and, as an example, used a media conference conducted by Princess Margaret Cancer Foundation that assembled the press with a release entitled “Long-Term Donor Support Helps Fund Cancer Breakthrough.”

The Toronto Star wrote a breathless editorial, “Donor support lets cancer researchers take a big step.” Upon examination, the big step wasn’t that big and the whole thing looked more like a donor cultivation event. Click here for a refresher.

This is not to say these organizations don’t do good work. They do, as do medical professionals associated with them. That’s why taxpayers pour billions of dollars a year into their upkeep.

But how the richest charities in the country conduct their fundraising activities and set their priorities does bear scrutiny. The “lives saved” statistic would be interesting to compare between the Canadian Red Cross, for example, and either one of these hospitals I’ve mentioned here. And the cost per life saved.

But life is not like that and the increasing gap between the rich and poor being played out in society at large, where 1% of people hold on to 99% of resources, is being mirrored in the charitable sector.

The matter of whose lives are actually being saved, both domestically and internationally, is baked into the inequity cake.

It might be worth noting here that the second leading cause of death among Canadian children under 15 is not disease, it’s suicide. The leading cause is accidents such as motor vehicle crashes.

The Sick Kids Foundation’s resourcing of its fundraising and marketing strategy and, more importantly, how it prioritizes its spending, is just one of many charity stories that need to be told in terms of how charity is meeting the needs of vulnerable populations as a whole.

The issues are not only important for people who work in charity, but for all Canadians who, through direct funding or the most generous charitable tax credit system in the world, are ultimately underwriting the vast majority of work that charities do.

In order to shed some light on the trending inequity and help address the absence of critique on the charitable sector, I’ve written a book called Cap in Hand: How Charities are Failing the People of Canada and the World that will be published next month by Civil Sector Press.

I’ve interviewed cancer researchers, hospital foundation chieftains, humanitarian aid veterans and sector observers to provide a picture of what charities are spending money on, the cost of charitable tax credits, the role mega donors are playing in setting a charity’s priorities, how charities market themselves and how inequity is built into the charitable system.

Stay tuned to this bat channel for information on the precise release date and for more stories about what’s going on behind the shimmering green curtain of good intentions.

[1] Note: Globe and Mail health reporter, André Picard, did write a story, Sick Kids campaign forgets that children aren’t always warriors, an interesting critique on the actual content of the campaign where sick children are turned into super heroes. It’s definitely worth a read. Click here to check it out. It states, “The ads will no doubt bring in big bucks. SickKids Foundation is already one of the country’s most successful fundraisers, having raked in $138-million last year, and the new $2-million campaign is specifically designed to attract new donors. But, in doing so, the hospital and foundation have offended part of their clientele, namely parents of children with chronic illnesses and life-long disabilities, who don’t see themselves represented in the “we shall overcome” messaging.”

Author Photo 01 Sandy Tam PhotographyGail Picco is a strategist and nonprofit executive who has worked in the charity sector for 25 years, most of which as President of Gail Picco Associates. Prior to establishing Gail Picco Associates, she spent eight years working in a shelter for assaulted women and children. She is the author of What the Enemy Thinks, a recent novel set in the nonprofit sector, of Your Working Girl, a blog of memoir and commentary on politics, charity and popular culture, and writes a regular column for Hilborn Charity News. She is a Principal with The Osborne Group in Toronto and Chair of the Regent Park Film Festival.

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  1. Janet Gadeski says:

    Gail, you might want to check the numbers in the paragraph on the Salvation Army. The total raised and the fundraising expenses seem to be reversed.

    • Hi Janet. It’s actually $905 million … “the Salvation Army, spent $227.3 million on fundraising, advertising and promotion or 25.1% of the $905 million they raised in fundraising between 2006 and 2015.” Thanks.

  2. Earl Pembroke says:

    I just found this article. This is one of the best informed and well written articles on this subject I have read for some time. Any comment I would make would simply detract from the excellent points you have made above. Well done. I have bookmarked this page for my future reference.

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