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The REAL Value of Direct Mail
July 2010 |
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The traditional and frankly easy way to evaluate a direct mail program is to determine net revenue and the number of donors you kept, gained and lost. A mature and well managed program will invest in acquisition, end the year with more donors and, if you are really good, achieve an overall higher average gift to boot. Results are evaluated annually or semi annually to inform the next budget cycle. Copley Raff encourages taking a longer and more detailed and sophisticated view of direct mail value. While all of the above is obviously important, and are targeted by CRI's Leadership Mail services, we have to acknowledge that the "unexpected" bequest was likely from a longtime $25 direct mail donor. The reality is that "even billionaires write $100 checks" and it is your job to find those high net worth donors in your donor file and to do something about them. Stories abound about the gift officer who picked up the phone to thank a donor for his/her large mail gift or loyal giving and ended up with a new friend, a larger donor and sometimes a new major donor. We ask, should the $2.5 million gift I was instrumental in securing from a $1,000 direct mail donor, five years after their first gift, be "credited" to direct mail? Should the $1 million gift from a donor who was introduced to me by a $1,000 mail donor I befriended be credited in some way to direct mail? And what about those bequests? We would argue... yes! A properly integrated development office has a staff person or persons whose job it is to make personal contact with targeted mail donors and to plumb the potential to elevate the donor to greater generosity and involvement. If your mail program is not producing new donors and net revenue, after you factor in the cost of the staff person who is likely not expert at direct mail, you should consider bringing in a direct marketing expert, like Copley Raff to help turn things around. An important dimension of the CRI engagement also aids in retasking and retraining staff to maximize your mail program through donor engagement. We enable them to meet with donors and ask for larger gifts. This is why we call it "development" and not "fundraising". Please contact me for more information about our Leadership Mail services and see our mail clients .
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Three Degrees of Separation is the Objective
March 2010
There are lessons to be learned from the “great recession” that should inform strategies for development and fundraising. It is now clear that the ever-profit-seeking whiz kids of Wall Street, and elsewhere, created this monster called “collateralized debt obligations” (CDO), which essentially repackaged and repackaged and repackaged home mortgages into what we now know are near worthless equities.
One key lesson – When there are too many degrees of separation between the actual transaction (Sally and Bob buying a house) and the reaping of value from that transaction (the CDO), you are in for trouble. In the “good old days” when banks held their own loans, they forged lifelong relationships with customers like Bob and Sally, from which all parties benefited. But once their loan has passed from investor to investor, far removed from the neighborhood loan officer who wrote it, Bob and Sally have become a transient transaction to the bank – and the bank has alienated them as future patrons. That’s because, with 6 or 7 or 10 degrees of separation, the bank is no longer in the “relationship business” with its customers.
For development officers, the lesson is clear: organizations MUST stay in the relationship business with its donors to remain relevant and gain their long-term commitment. When a donor makes a gift to your institution, be sure that your “thank you” note expresses the mission “value” of their gift along with your gratitude, and that your newsletter puts their investment into the context of your mission by demonstrating the direct value of their gift to those you serve.
You asked the donor for the gift (1 st degree), your organization (the mortgage lender) got the gift (2 nd degree), and your organization will use it to benefit those you serve (loans to other Sallys and Bobs) (3 rd degree). If, however, your benefiting constituent is 4 or 5 degrees removed because the gifted funds were designated for a capital campaign or an endowment fund… then you must work very hard to compress and finesse your message so it feels like no more than 3 degrees of separation.
In short, stay close to your donors - figuratively, rhetorically and personally . If you’re not doing so, another organization is. And when it is time to launch that campaign, you want to have the comfort of knowing that you and your organization have done all that you can to build collateral with your donors with the hope they will feel a debt of gratitude to your organization and an obligation to continue to support your mission.
Larry G. Raff, MPH
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Confessions of a Social Media Phobe
October 23, 2009
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I have a confession to make
...I am Twitter challenged... and I am blog challenged. The first step in recovery and avoiding the fear and guilt that (mavens tell me I should have) veteran development professionals may not be catching the social networking wave, is to first confess. How many of you will join me?
After doing some research, I began to feel better about not having carved out time (hours) to keep up...but maybe I should. A couple of insights:
I decided to go right to the source to see if am alone in a sea of development professional social media users. I (shamelessly) made use of my position as President of the Friday Forum in Boston to ask a room of 100 development veterans about their use of social media tools. Here are the unscientific results: 1. How many of you twitter? 10% 2. How many of you read someone else's twitter? 10% 3. How many of you blog? 10% 4. How many of you read someone else's blog? 50% 5. How many of you are on Linked-in? 90+% 6. How many of you are on Facebook? 90% 7. How many of you do email blasts as part of your work? 75% 8. How many of you use other social media? 5% 9. How many of you use streaming video in your work? 5%
I was feeling better with each question. Now I submit, the room was dominated by 40, 50 and 60 somethings who lived through the computer, internet and email wave, but perhaps have not yet caught the social media currents. But at the same time, let us not forget that our most promising donors are of the same vintage and may be availing themselves of twitter and blogs at the same slumbering rate. But are our future donors blogging away?
I think the verdict is still out on whether Twitter , Plurk , Tumblr , Jaiku , fmylife , Blogger , LiveJournal , Open Diary , TypePad , WordPress , ExpressionEngine , Xanga , Bebo , Facebook , LinkedIn , MySpace , Orkut , Skyrock , Hi5 , Ning , Elgg , NutshellMail , FriendFeed , Digg , Mixx , Reddit , NowPublic , epinions , Yelp , Flickr , Zooomr , Photobucket , SmugMug , Picasa YouTube , Vimeo , sevenload , Ustream.tv , Justin.tv , Stickam , and Skype will eventually become important development tools, or whether they will even still be around and in five years. We need to keep our finger on this pulse. Afterall, there were skeptics about the World Wide Web way back in the day. But for now, email, snail mail, phone conversations and old fashioned face to face meetings still float my boat and keep me close to the important people in my life. (Should I have put this on a blog???) Most humbly, |
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Recently reported by the Chronicle of Philanthropy:
April 28, 2009
Online Networks Produce Little Revenue for Charities, Study Finds
By Paula Wasley
Nonprofit groups have embraced social networks like Facebook and Twitter to reach out to supporters, but few groups have attracted more than a few thousand supporters to their networks or raised much money, according to a survey of 980 nonprofit officials about their organizations' use of online social networks.
The survey, sponsored by the Nonprofit Technology Network, Common Knowledge, a San Francisco online fund-raising and marketing consulting agency, and ThePort a social-media software company in Atlanta, found that nearly three-quarters of nonprofit groups maintained a presence on Facebook, by far the most popular commercial social network.
About 39.9 percent of the officials said their charities had used Facebook for fund raising, but 29.1 percent had raised $500 or less using the social network over the past 12 months. And only 1.2 percent had received $10,000 or more through Facebook. Revenue received through advertising and underwriting on social networks was "not present in any meaningful way," the report concluded.
YouTube and Twitter were the next most common social networks after Facebook, with 46.5 percent and 43.2 percent of nonprofit groups, respectively, using those sites, followed by 32.9 percent that use LinkedIn and 26.1 percent that use MySpace.
Just under one-third of nonprofit groups had built their own in-house social networks to bring online supporters together to discuss a specific cause or issue.
On Facebook, 97 percent of organizations had attracted 10,000 members or fewer, and an average of 1,369 members. Among those organizations that built their own networks nearly three-quarters had 2,500 or fewer registered members.
The resources nonprofit groups have dedicated to social networking are "small but real," says the report, and likely to grow. Four out of five participants reported that their organizations had dedicated at least one-quarter of a full-time staff member's hours to social networking. And more than half said they planned to increase staffing for social-networking projects over the next year.
Tuesday April 28, 2009 | Permalink
(July 13, 2009) http://philanthropy.com/news/updates/index.php?id=8853
At a recent Council for Advancement and Support of Education conference, experts predicted that the current economy is likely to affect the "gift pyramid". Bruce R. McClintock, chair of consulting group Marts & Lundy, predicted that the expectation for campaigns counting on 70 percent of their dollars coming from the top 1 percent of donors (those who give gifts of $1 million or more) may see that shrink to just 50 percent-- while the middle of the pyramid (donors who give between $100,000 and $999,999) is likely to expand from providing 4 percent of the dollars raised to 25 percent. This means a higher volume of donors will require cultivation and solicitation to achieve campaign goals. The golden age of reliance on a small number of megagifts is over.
Speakers at the conference were optimistic that fundraising offices able to adapt to the changing environment and redeploy their resources accordingly will continue to raise significant amounts of money. The experts agree, this is a time to re-engineer your operation and invest in the middle of the pyramid with more major gift officer skill and resources.