comp anion booklet the power of direct...

THE POWER OFDIRECT MAILDeveloping your direct mail program...

COMPANION BOOKLET

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CompanionBooklet 10/10/06 12:45 PM

CONTENTS

INTRODUCTION

APPEAL TYPESAND RESPONSE OUTCOMES

WHAT KIND OF A RESPONSECAN YOU EXPECT?

OTHER FACTORSTHAT DRIVE RESPONSE

YOUR TEAM - WHO WILL MAKE IT HAPPEN?

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1 14THE POWER OF DIRECT MAIL

Mail ManagerTo make sure the elements in your packages are person-alized correctly and folded, stuffed and sealed, andmailed with the proper postage. You can save a lot ofmoney by presorting your mail, and a lot of time by out-sourcing to a “mailing house” or “lettershop” (someprinters offer these services). Smaller nonprofits often usevolunteers.

A Workable Production ScheduleGive yourself plenty of lead time by working backwardsfrom your mail date. Here’s a general guideline to follow:

Stuffing and Mailing: One weekPrinting: Two weeksFinal Package Review: One week (longer if you need board approval)Design Review and Revisions: One weekDesign: One to two weeksCopy Review and Revisions: One weekCopywriting: Two weeksConcept Review and Revisions: One weekCreative Concepts: One weekUnexpected surprises: One week

This adds up to about 12 weeks. Work this into yourmail calendar for each package as soon as possible.

Now you’re ready to harness the power ofDirect Mail!


YOUR TEAMWHO WILL MAKE IT HAPPEN?

Direct Mail Program ManagerTo oversee all aspects of your direct mail program,including the budget and mail schedule, and make surethe packages come together smoothly and get out thedoor on time.

List ManagerTo source, clean (merge/purge) and update your mailing lists, and send acknowledgements as giftsarrive. If you’re renting a list, this person will also coordinate with your outsourced list broker or manager.

Creative TeamTo develop the creative concept, then write and designyour packages. If you don’t have experienced copywriters or designers on staff, outsourcing theseresponsibilities is a good idea.

PrinterTo print the components that will go in your package.Prices can vary dramatically (and so can service), so get several competitive bids and references. Print brokers can do this legwork for you, and their fees are typically transparent.


Chances are, you’re already doing direct mail fundraising in one way or another. Your newsletters,event invitations, seasonal mailings, letters to “friends”asking for support—all these are forms of direct mail.

Applying what worksYou don’t need a marketing degree to make direct mailfundraising work for you. You just need to know whatworks.

Successful direct mail strategies and techniques arebased on empirical fact, because just about everythingcan be tested and tracked.

So all you need to do is apply these proven methods toyour own organization. Then repeat the ones that workbest for you.

The Program and the CDThis booklet walks you throughthe basics of putting together asuccessful Direct Mail Program.

Use the animated tool on the discenclosed to help you create your powerful and effective Direct Mail Packages.


The Direct Mail MindsetIt’s simple: the more donors you have, the more fundsyou can raise... and the more good you can do.

Direct mail helps you locate people who might be inter-ested in supporting your mission. It keeps your donorsup to date, motivates them about your mission and asksthem for increasingly greater levels of involvement.

And most importantly, it helps you identify potentialmajor donors.

Direct mail also helps you build your brand and educatethe public. Which makes the first step — finding peoplewho will support your mission — all that much easier.

Step-by-Step PlanningBefore diving into your packages, take a look at youroverall program.

Do you have well-defined goals?

Do you have what you need in place to reach thosegoals?

What should you fine-tune before moving forward?


BudgetingDirect mail is an investment. Be sure to determine thecost of printing, postage, work hours, outsourced servic-es and other expenses before making any decisions.Nearly every step has room for budgeting options oreconomies of scale. (Note: self-mailing packages arecheaper to produce but generate fewer responses.)

Acquisition mailings appear to be the most “expensive”because they get the lowest returns. For these donor-building mailings, you’re shooting to break even. Thesaying goes: If you’re making a net profit, you’re notmailing enough.

Donor appeals are a different story. These bring in yourfunds.

Think of it as the difference between fishing in a lakeand fishing in a barrel. But you need to keep restockingthat barrel!


Database ManagementYour direct mail program canonly reach its potential with agood system for continuallyupdating and tracking donorinformation.

If you’re already using afundraising software program —great! If not, there are manygood options available, startingfor as little as $500. Some com-panies offer on-line solutions,and manage your database for you.

It’s very important to show yourdonors you’re professional andcare about them by making surenames, addresses, salutations,gift amounts and dates are100% correct.

TestingMaybe you’ll get a better response if youinclude additional elements in your mailing, such as abrochure that highlightsbenefits or a “lift letter”from a different signerthat offers a complementary point ofview. Or you could trya different offer. Seewhat works best foryou by splitting yourmailings in two andtesting for one variable. Then testsomething different thenext time around. (Seethe animated tool fordetailed information on package elements.)


APPEAL TYPES AND RESPONSE OUTCOMES

Who are you mailing to — and why?

Understanding different appeal types and audiences isthe first step in developing a successful direct mailfundraising program.

Acquisition Appeal (Cold Prospects)Mailed to “strangers” to recruit new donors. The goal isto engage them in your “story” and explain how theypersonally will benefit by supporting your mission. Besure to explain how your programs are different fromthose of similar organizations and make it very easy to respond.

Renewal Appeal (Annual Giving, Donor or Membership Program)Mailed to current donors to maintain their support. Youwant to generate excitement about your recent successes(and challenges) and your upcoming goals. Start mailing monthly renewals two months before donorsanniversaries, and send up to six different reminders inall. “Upgrade Packages” ask donors to renew at higher levels.


Lapsed Donor AppealMailed to donors who have not given for 12 months toask them to come back. Remind them about the important work you’re doing, how much you appreciatetheir past support, and all the personal benefits of supporting your organization. Consider offering a gift or discount.

Year-End AppealMailed to donors, members and strangers to ask for an“extra” gift during prime giving season. Try to avoidsending renewals during the holidays.

The Year-End appeals really should be extra.

Special AppealsMailed to ask donors and possibly strangers to becomepart of an elite group or a contributor to a specific goalor program. Send an “Emergency Appeal” when you’re faced with a genuine crisis.


OTHER FACTORSTHAT DRIVE RESPONSE

CreativityHow your package looks — and especially what yousay — has a major impact on your success (see the“window-flap” enclosures for details). Research showsthat copy accounts for as much as 40% of direct mailfundraising success, and design for 20%.

TimingCreate a mail schedule that includes all your appeals,invitations and newsletters. If you bombard donors or,conversely, ignore them for long stretches, your resultswill suffer. Note: Acknowledgements are mailed year-round, as you receive your gifts.

FrequencyOften you have to ask several times before getting aresponse. New donors like familiarity, and current orlapsed donors may intend to support you again buthave put it off. The key is to keep mailing!

Timing Tips especially for New-Donors• Avoid July, August and the three weeks

before Christmas.• Shoot for January through March, and

September through November.


Exchanged ListsIf you want to reach out to new donors, consider tradingyour in-house list, or segments of it (such as lapseddonors), with organizations that have similar or like-minded constituents.

Rented ListsYou can rent names of likely donors from list brokers orlist managers. They can tell you which lists are availablefrom which organizations, how they can be segmented(zip code, income level, gender, etc.) and how muchthey cost to rent. Usually nonprofit direct mail donor listscost between $75 and $125 per thousand names, andare available in multiples of 5,000.

Segmenting Your ListsThe more you segment (create subsetsfrom) a list, the more you can target yourappeals and “offers.” Often it makessense to have two or more versions ofthe same letter, each targeting a differentsegment. Use a unique “key code” to track your results. (See the animated tool for details on offers and key codes.)


InvitationsMailed to invite donors, friends, neighbors and otherpotential supporters to your fundraising event. Make iteasy for them to donate right then and there, even ifthey can’t attend.

Welcome Packages or AcknowledgementsMailed to immediately thank new donors by officiallywelcoming them to the “family” (and providing addition-al information), or to thank established donors andremind them about all the good work they make possi-ble.

NewslettersMailed to bring your constituents up to date. Alwaysinclude a sidebar on how to donate, and “tip in” areply envelope so they can send you an extra gift, ifthey’re inspired.


WHAT KIND OF A RESPONSE CANYOU EXPECT?

You’re going to get a better response from people whoare familiar with your organization, and a much betterresponse from those who are currently supporting you.

Current and Lapsed DonorsThe average response rate for a first-year renewal mail-ing is 30 - 40%. That rate increases by about 10% eachyear for the next two years, by 5% for the next four afterthat, and incrementally thereafter up to a 93% renewalrate for 10-year donors. Some donors stay all their lives.

On average, 10 – 20% of your donors will send you alarger gift, or “upgrade,” if asked. Many give severaltimes a year, and also attend events or volunteer. Thequality of your direct mail communication is critical tomaintaining strong relationships. Lapsed donors respondat a rate of about 4 - 12%.

New DonorsThe average response rate for an acquisition mailing is0.5 – 2.5%. When you think about the potential valueof each new donor — and how adding several hundredor thousand new donors each time you mail — it’s clearhow those percentages tally up over time.

Gift Amounts The average gift amount depends primarilyon how much you ask for.

Usually you’ll get a higher response from alower ask. And you’ll get fewer, but moremeaningful, gifts from a higher ask. Keep in

mind: the larger the initial gift, the better your chances of getting a second one.

Mailing ListsWho, exactly, you mail to is no small matter. The qualityof your mailing list can represent 40% of your success.

In-House ListsYour database of names is your in-house list. Whenmeticulously updated, it’s your most valuable resource. Itwill likely include (and hopefully segment) your donors,volunteers, board members and people who have attended events or otherwise expressed interest in yourorganization.



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