September 2005
The back-end of monthly giving Part II
Integrating online with direct mail and telemarketing (Part III) by Madeline Stanionis
What's up online by Dan Weeks
The back-end of monthly giving
Part II of our interview with Beverly Kempf
Last issue, we began our discussion with Beverly Kempf, President of Payment Solutions (Bethesda MD), a firm that specializes in the back-end management of monthly giving programs. In Part I, we reviewed the pros and cons of using credit cards vs. electronic funds transfer (EFT).
Now we turn to Kempf's take on the trials and tribulations of actually setting up and maintaining a successful sustainer program.
Staffing and capability
The key, according to Kempf, is the capability of the nonprofit's staff to manage the wealth of data generated in a monthly giving program. "Where they lose out," notes Kempf, "is the database that tracks all these people. To make sure their flags are right, that they're coded for the correct amount, and that changes are made accurately."
Think of it this way, she adds: "It's not so bad if you charge somebody $100 once when it should have been $10. But if you do it every single month, you have a pretty unhappy sustainer. And probably not a sustainer anymore."
Following up
Kempf recommends that once payments are debited from the donors' accounts, the nonprofit then needs to double-check its own bank account to make sure all the deposits match up properly.
What's more, after payments are made and verified, donors can go to their bank or credit card company and initiate an "EFT return." Kempf explains that they can dispute the charge, which generates a notice to the nonprofit from the bank or credit card company.
The problem, cautions Kempf, is that these notices "are not always intelligible. But you have to look at them because what they're saying is that you have an unhappy donor who is disputing the charge that's already been made. And if you disregard that—and keep charging or debiting the account—you're going to have a really unhappy person."
A related issue is that a nonprofit will often route this notice to its Finance Department, which can be somewhat removed from the Development Department. So while Finance will see that a donor backed out of a gift, this information needs to get to Development so it stops making the charge or debit. Or at least finds out what's going on with the donor.
Just do it!
When it comes to monthly giving, Kempf's best advice for organizations large and small is "do something! Figure out how to get it done. Because it's something every group should be doing. Certainly don't give it up because you think you're too small."
If, for example, you already have a way to take credit card charges, the mechanics of monthly giving are in place. "Say you're only going to get 20 people to sign up for credit cards. You can make an Excel spread-sheet and once a month pick a day to charge those 20 people. That's a sustainer program."
Pre-authorized checks
However, if you don't have credit cards set up, Kempf warns that you have to think about the cost. In effect, "forget about credit cards and think about EFT. Because there is an optional way of doing small volume EFT.
"It's called pre-authorized checks. It's not truly an electronic funds transfer. But it does the same thing. It's just generated by a company creating the check."
As Kempf describes it, the donor is asked "to become a sustainer by having her payment made automatically from her bank account every month. The donor authorizes payment." A check printing company then prints up booklets of pre-authorized, post-dated checks. Each month the organization tears out a check—a real, live check—and deposits it into its bank account.
Other than the cost of the booklet—roughly $4.55 for a book of 12—the nonprofit is maintaining its EFT program all by itself (including a one-time set up fee of about $50 with the check printing company).
This approach gives a small organization a way to get started. But, cautions Kempf, "once you've got 50-100 sustainers, depending on your staff, then it's time to look at automating."
This was Part II of our interview with Beverly Kempf, President of Payment Solutions (Bethesda MD), a firm that specializes in the back-end management of monthly giving programs.
Integrating online with direct mail and telemarketing (Part III)
By Madeline Stanionis
Let's start with segmentation.
The most typical segmentation strategy for the online components of your renewal series is obvious: giving level. The reason is to deliver a giving page on your site that contains the appropriate gift string. You won't always have to do this: Some ASPs are already able to create a custom giving page based on Highest Previous Contribution on the fly and more will follow. But until then, you'll probably need to create giving pages for each segment based on HPC, like this grouping we recently set up for a client:
$1-$34
$35-$59
$60-$99
$100-$249
$250 and above
A more recent twist on this segmentation is to segment further by those who have given online and those who haven't. This makes it possible for you to begin identifying those donors who regularly donate online, so you can eventually pull them from your direct mail track.
Now on to testing
You can have a lot of fun with testing in your renewals since you're probably seeing your highest results there. But, your segments are probably still small, so you may need to duplicate the tests a number of times to get usable results. The following are four of the tests I recommend:
"Taking care of business" vs. "Pitch me baby one more time." This is a test of a short donation-page vs. a long donation-page to improve conversions. By short, I mean very brief copy—one sentence—as opposed to four or five sentences meant to further pitch your renewing donors.
The subject line is your teaser. "Your membership is expiring." "Renew today—and save even more puppies." I strongly recommend that you test to find your best performing renewal e-mail subject line. Then use it over and over.
Where should I click? There are all sorts of so-called gurus out there who will tell you where the money spot is in an e-mail. Top right? The P.S.? Create custom URLs for each of about three or four locations—for example, a button right up top, in the masthead; in the P.S.; and perhaps a graphic button in the body. See where your money spot is.
Boosting the average. Split the file and pre-fill the lowest gift level on one donation page and the next one up on the other donation page. These are numbers to tweak to find your sweet spot—where you keep the response rate high and boost that average gift as much as you can.
And now two final tips:
Follow up! If your donor clicks to the donation page but doesn't complete it, remind her! We've used pop-unders (like pop-ups, but they appear after a user has closed a donation page) to remind the donor that she hasn't finished her renewal, as well as special e-mails to those who clicked but didn't fulfill their gifts.
Persistence, persistence, persistence! A colleague recently told me he sent the same renewal e-mail to the same segment three Mondays in a row (suppressing respondents, of course). And each week, the response rate was the same. The same. Wow. Are you going to try it? I am!
Madeline Stanionis is Vice President and Creative Director at Donordigital, 182 Second Street, San Francisco CA 94105, phone (415) 278-9444, fax (415) 901-0112, e-mail madeline@donordigital.com, Web www.donordigital.com. This article is adapted from her forthcoming book, The Mercifully Brief, Real-World Guide to Raising Thousands (If Not Tens of Thousands) of Dollars with Email, to be published fall 2005 by Emerson & Church Publishers.
What's up online
By Dan Weeks
In the aftermath of Hurricane Katrina's destruction, The Red Cross has responded not only with aid, but with a well-designed, bilingual Web site that covers just about every conceivable angle of ways to help, as well as providing valuable information to those affected.
Victims and evacuees with access to the internet can join the Red Cross Family Links Registry and search by zip code for the nearest Red Cross chapter. People wishing to help will quickly and easily find information about online giving, official Red Cross cash donation sites, donating goods, giving blood, donating tissue, and volunteering. There's a even a way to get a web banner for your own site to encourage others to help. Check it out at www.redcross.org.
Want more? Sign up to receiveSuccessful Fundraising Online every month via e-mail.
