August 2006

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In this Issue:

And the winner is... A true winner!

By Mal Warwick

EXTRA!: Positioning: creating a memorable image
By Jerr Boschee

On Lists: Choosing the right lists

By Suzie McGuire

Special Report: Do Images Help or Hurt?

By Eve Fox and Katelyn Sabochik

AND THE WINNER IS...

A true winner!

By Mal Warwick, Editor

RARELY have I used this space to trumpet the virtues of my colleagues’ work at Mal Warwick Associates (Berkeley CA). It’s been the policy of this newsletter to keep our pages open to any and all comers, competitors or not—so long as they’ve got something meaningful to teach us. But I can’t resist this time around.

In a July 2006 gathering in Washington DC of the Direct Marketing Association of Washington, Mal Warwick Associates won a coveted Silver Maxi Award for a high-dollar donor appeal created for the Make-A-Wish Foundation, Greater Bay Area (San Francisco CA), and here it is for you to see.

What’s distinctive about a Maxi Award is that it’s granted not just because the judges think the package is a winner but because the results prove it. And so they do:

-Make-A-Wish mailed 2,697 of these packages to its top donors at a cost per package of $5.15. Hefty? Yes. A lot of elbow grease went into producing these appeals!

-The mailing yielded 278 responses, a rate of 9.3%. Revenue totaled $108,851, netting $93,550. The average contribution was $391.

-Cost to raise a dollar was $0.14. How often do you see that in direct mail fundraising?

The contents of this award-winning package included the following:

-A pale yellow, unprinted, closed-face 9 x 12” carrier bearing a 60-cent stamp and an oversized, preprinted mailing label;
-A 2-page (one sheet), personalized letter, 8-1/2 x 11”, pre-printed in blue and laser-printed in black;
-A personalized, 4-page “proposal” printed black only (pp. 2-4) and blue only (page 1);
-A 5-1/2 x 8-1/2” “Memorandum of Acceptance” printed blue on both sides and laser-personalized on page 1;
-A white #9 reply envelope, printed front only blue and black;
-All bound together with a hand-affixed paper clip in the upper left-hand corner.

Kudos to Senior Consultant Suzie McGuire, who managed the project; Susie Fought for the copywriting; Francesca Suzio for the design; and the staff of the Make-A-Wish Foundation, Greater Bay Area.

View the entire Make-A-Wish Foundation package.

Congratulations and Successful Direct Mail, Telephone & Online Fundraising Award Certificates to Suzie McGuire

Mal Warwick Associates

2550 Ninth Street #103

Berkeley CA 94710

phone (510) 843-8888

fax (510) 843-0142

suzie@malwarwick.com

www.malwarwick.com

And to the Make-A-Wish Foundation

Greater Bay Area

235 Pine Street 6th Floor

San Francisco CA 94104

(415) 982-0444

www.makewish.org

EXTRA!

Positioning: creating a memorable image
By Jerr Boschee

MARK BERGER gazed at a sea of faces in a San Diego conference center this April, the first speaker from a panel of social entrepreneurs sharing their stories. I served as moderator.

“What does our organization do?” he began—then answered his own question.

“We create taxpayers!”

Berger is President and CEO of Partnerships with Industry (PWI), a social enterprise that provides training, placement, and ongoing support services for adults with developmental disabilities (including those with autism, epilepsy, mental retardation, and other challenges). PWI simultaneously meets the labor needs of more than 350 employers and serves more than 650 people daily through vocational assessment, contract services, group services, and individual placements. Founded in 1985, it has four offices in San Diego, Riverside, and San Bernardino counties, and its signature product is the Camelbak backpack. PWI has produced 634,000 of them already.

As I listened to Berger begin his speech, I was immediately struck by the power of his positioning statement. How many times have we heard nonprofit executives stumble when we ask them to tell us what they do? The attention span of an average questioner is about 30 seconds—and by that point many nonprofit execs are just getting started!

When I arrive at a venue where I’ll be giving a plenary session speech or conducting a workshop, I make it a point to introduce myself to as many people as possible before I begin, and I always ask them what their organizations do. Some can give me crisp, direct answers. Many stumble, as if the question surprises them. Some try to cover the waterfront, to make sure I understand everything they do, and my eyes glaze over. And a few never do explain things intelligibly.

Even those who have carved their elevator pitch down to a bite-sized chunk frequently do it in soft, “nonprofit” terms: “We help people who are developmentally disabled live independently,” “we help people enter the mainstream of society,” “we provide vocational training services,” and the like. Few make people sit up and take notice the way the audience did in San Diego when Berger introduced them to Partnerships with Industry.

Marketing is not simply a matter of creating a brochure, writing a press release, or changing a price. Fundamentally, marketing is about winning a share of mind—and that means busting through all the clutter assaulting the minds of our target audiences. Berger certainly did that. His three-word phrase “We create taxpayers!” came as a surprise to everybody in the room and woke them up. From that point on, he had their attention.

Because marketing is a battle of ideas, the goal should be to stake out territory nobody else can occupy—to own a single word or phrase in the minds of stakeholders that pre-empts a powerful attribute and makes it unavailable to others. There are a lot of nonprofits providing services to people who are developmentally disabled—but Berger’s phrase sets his organization apart from any other I’ve come across. He’s found a way to differentiate PWI, the first step in creating a memorable image. It may be that others will begin to use his phrase, but PWI will have been the first—and the phrase will belong to PWI so long as it’s reinforced and repeated.

People have a tendency to reduce organizations to a few simple traits, and the image of your organization that exists in their minds is nothing more than what remains after everything else is said and done. Berger is making it easy for them: “We create taxpayers!”

So, what is the single most important thing you would like people to remember about your organization?

Jerr Boschee is Executive Director,

The Institute for Social Entrepreneurs

6215 Sandydale Drive

Dallas, Texas 75248

(214) 866-0472

jerr@orbis.net

This article is adapted with permission from Jerr’s column in Social Enterprise Reporter, May 2006, www.sereporter.com.

On Lists

Choosing the right lists
By Suzie McGuire

WHEN A LIST broker presents you with some possible lists, how do you decide between two similar lists? What makes one list better than another?

Typically, a broker will send you a data card that describes the organization, its pricing, and available “selects” (limiting criteria such as gender, geography, etc.). When reviewing a data card, I look for several clues as to the condition of the list and whether it’s the right choice for my particular plan. Here are some of the things I consider:

LIST DESCRIPTION

Is the mission of the organization and its list market similar to the nonprofit I represent? The closer the affinity, the more likely those donors will be interested in hearing my offer.

HOW WERE DONORS ACQUIRED?

Usually I look for donors who received their offer via direct mail and responded via direct mail. Event-attendee, prospect, and lapsed-donor lists don’t tend to work as well as lists with active direct-mail-acquired donors.

RECENCY

Typically, list owners offer donors who have given within the past 24 months. If the file is large enough, the list manager may offer selects of donors acquired within the most recent 12 months, six months, three months, or even less. The more recently a donor has given, the more responsive that donor is likely to be to your offer.

DONATION LEVELS

In most instances, I’m hoping to find donors who have given single donations of at least $10. But you should be looking for donors similar to yours. So if you represent an organization seeking a lower ask as an entry point, you might choose lists that have lower giving levels.

LIST UNIVERSE

If I’m going to invest in renting a list, I want to make sure I have plenty of names for future use. Assuming the list performs well, I want to ensure that I have a big enough quantity to split the list across package variations. Also, I’ll want to note how the list duplicates against others in the merge-purge process, since those with high duplication rates are more likely to be similar to my donors and thus better prospects.

FREQUENCY OF UPDATES

How often is the mailing list updated, and are newly acquired names added into the mix?

COST

Is the list appropriately priced? Does the list owner offer nonprofit base rate discounts? More important, is the list available on exchange? Is the list manager willing to negotiate special rate discounts for first-time tests?

USAGE

Many people like to look at the usage noted on the data card. In some cases, this is instructive, but you need to remember it’s often used as a selling tool by the list manager. My preference is to ask my broker to counsel me on which lists are performing better for other users.

OFFER

Did the organization acquire its names with premiums, or did donors respond to a straightforward appeal? Again, choosing or not choosing these lists would depend upon how you were attracting donors. If I were mailing a calendar or address labels, I would want donor names that were similarly acquired.

FULFILLMENT

How expeditiously can the list be approved and processed? There’s nothing more frustrating then wanting a particular list, only to find out you can’t get it for your mailing.

These are just a few things to consider when approaching a list plan. When in doubt, check with your consultant and broker who can help you prioritize lists in conjunction with your specific acquisition goals.

Suzie McGuire is a Consultant at Mal Warwick Associates Inc.

2550 Ninth Street, Suite 103

Berkeley CA 94710-2516

(510) 843-8888 ext. 250

fax (510) 843-0142

www.malwarwick.com

suzie@malwarwick.com

Special Report

Do Images Help or Hurt?
By Eve Fox and Katelyn Sabochik

ONCE UPON a time in cyberspace, we assumed that including an image in an e-mail action alert or fundraising appeal would make it more effective. But that era may have come and gone. Several recent tests we’ve conducted on behalf of our nonprofit clients indicate that images may no longer boost response rates. In fact, they may be detrimental to your cause.

If you’re trying to save the Arctic Refuge, why would including a photo of an adorable baby polar bear in a fundraising appeal potentially depress response rates, you ask? Although it’s impossible to say with 100% certainty, we’ve identified two likely culprits for the decline in images’ effectiveness.

1) IMAGES ARE BEING BLOCKED.

The default setting for Outlook (from 2003 on) is to block all images, and more and more ISPs and e-mail providers either block images by default (including Gmail and AOL) or offer image-blocking options. Many people, particularly the less technically inclined folks, will never adjust these default settings. Therefore, as people upgrade and change e-mail providers, more and more of them will likely not see the images in the messages you send them.

Although your message may still be compelling, it may appear to the reader to have an ugly, confusing hole in it where the image should be. Worse yet, if you failed to specify height and width attributes for the image when you were setting up your message, the blocked image may actually fill the entire computer screen—pushing your content far down the page and making it more likely that the recipient will never see the text or click on the advocacy/fundraising link you provided.

This scenario may be slightly off-putting for a message with just one or two small graphical elements, but it could spell real trouble for a highly “designed” message in which a great deal of the content is represented using images. It may also be particularly problematic for people who decide whether or not to “open” and read the message by glancing at the preview pane. If all they see is white space, they’re probably not going to open the message. See page 4 for an example of what a graphics-heavy e-mail looks like in Gmail.

2) IMAGES ARE TRIGGERING SPAM FILTERS AND BLOCKERS.

The rise of spam has led to an army of spam-blocking services and filters. More messages with images are being caught or “quarantined” by overaggressive spam blockers that mistakenly identify as spam or pornography any e-mail containing an image. The upshot is that messages with images may now have a much tougher time reaching your subscribers’ inboxes than they did even a few years ago.

WHAT DO TESTS SHOW?

To provide a bit more grist for the mill on this question, check out the data below from the three tests we conducted on behalf of our clients, all nonprofit environmental advocacy groups.

Action Alert Test: Photo of the Popular Polar Bear

The test below was designed to determine whether the inclusion of an image would increase or decrease response rates to an e-mail advocacy alert on polar bears. We chose this particular alert because polar bears are visually appealing crowd-pleasers, making it more likely that including a bear photo in the message would significantly boost its appeal — at least more so than a photo of a vulture, eel, or warthog.

Three versions were sent to randomly and equally divided samples of the organization’s e-mail list. The text of the three messages was identical. The only difference between the messages was the number of images contained in each.

-Message #1: Header Image Only. This version contained the standard e-mail header image (368x96 pixels), but no other images.

-Message #2: No Images. This version was stripped of all images. The message was created as an HTML message to allow for better formatting and did contain an invisible 1-pixel image used to track the open rate.

-Message #3: Header Image and Additional Image. This version contained both the header image and an additional image (featured below, at right) of an adult polar bear and two cubs in the body of the e-mail message. Please note that we did include alt text and height and width attributes in our HTML to help ensure that the message remained nearly intact for people who used software to block the photo of these cuddly-looking (albeit extremely dangerous) bears.

The photo is pretty cute, right?! Who wouldn’t want to help this adorable bear family once they’ve gotten a good look at it? Interestingly enough, including this additional photo did not boost response rates!

The results from each of the three messages were shockingly similar. While the version with no HTML wrapper or image had a slightly lower open rate and response rate than the other two versions, the differences among the three versions were so small that they’re not statistically significant. This means we cannot say with any certainty that including an HTML wrapper or any additional images in an e-mail message has any effect on open rates or advocacy response rates.

Action Alert Test

Message Version	Messages Received	Actions Taken	Open Rate	Click-thru Rate	Completion Rate	Resonse Rate
HTML wrapper, no image	134,195	11,569	18.45%	8.84%	97.53%	8.62%
No HTML wrapper or image	136,949	11,983	18.46%	8.97%	97.57%	8.75%
HTML wrapper + additional image	137,098	11,949	18.70%	8.95%	97.38%	8.72%

Fundraising Appeal Test #1

Message Version	Messages Received	# of Gifts	Amount Donated	Open Rate	Click-Thru Rate	Page Completion	Response Rate
HTML wrapper + image	47,324	103	$5,055	23.50%	0.86%	25.25%	0.22%
HTML wrapper, no image	46,385	112	$6,570	23.30%	0.91%	26.60%	0.24%

ARE IMAGES MORE EFFECTIVE IN A FUNDRAISING APPEAL?

Another question we couldn’t help exploring was whether or not images might make a difference when used in a fundraising appeal instead of an action alert. We tested the inclusion of images in two separate fundraising campaigns for another nonprofit environmental advocacy group. The results of both tests are below.

Fundraising Appeal Test #1: Image vs. No Image

In this instance, both messages had HTML wrappers with header and footer images, but one message contained an additional image of a landscape scene while the other message contained no additional image.

Overall, the difference in open rates and response rates to these fundraising appeals was not statistically significant. The version without the photo raised significantly more than the version with the photo, but this difference was due in large part to one high-dollar donation.

Fundraising Appeal Test #2: Image vs. Callout Box

As in Test #1, both messages contained HTML wrappers with header and footer images. One message contained an additional image of a landscape, while the other message contained a callout box in the upper right hand corner with a brief blurb about the campaign and a link to the donation page. The call outbox was formatted in HTML, but contained no images.

Overall, the difference in open and response rates to these fundraising appeals was not statistically significant. As with the first test, the version without the image (albeit with the callout box) raised significantly more than the version with the photo, but this difference once again was due in large part to one high-dollar donation.

SURVEY SAYS...

Although we cannot make any definitive claims based on the results of just three tests, these results do indicate that the inclusion of additional images does not increase response rates to advocacy messages or fundraising appeals, nor does it decrease them. While it may not hurt to include properly formatted images in your e-mail message (thought it could hurt if your message gets quarantined or rejected by a potential donor or activist because it looks blank in the preview pane), it also doesn’t appear to help at all.

However, if you’ve got a great photo of a charismatic or cuddly animal, beautiful landscape, or appealing person making direct eye contact, you may want to use it—provided you take the time to format your image properly (see our tips on this below). But if you’re running out of time, can’t find the right photo, or simply can’t afford the licensing fee for the photo you would like to include, don’t sweat it. Your action alert or fundraising appeal will probably be just as effective without it!

TIPS FOR INCLUDING IMAGES IN HTML E-MAILS

1) Use smaller header images.

Large header images may take a long time to load. They also push the text of your e-mail message farther down the screen, forcing readers to scroll down to read your message or click on the all-important links to the action or donation page. To minimize scrolling and loading time, make sure the first few paragraphs of your e-mail message (and at least one link to the action or fundraising page) are visible above the fold in your HTML message.

2) Always include the image dimensions and alt text.
With so many e-mail providers using image-blocking technology these days, HTML messages that don’t include the image dimensions or alternative text can leave your messages looking completely mangled. Specifying image dimensions will ensure that the appropriate amount of blank space is left in place of the image. The alt text (text that appears in place of a blocked image) will clue your readers in to what they should be seeing. However, if you use spacer images (and we don’t recommend them), do not include alt text!

3) Cut back on spacer images.
Image blocking makes it less attractive to use spacer images as they will manifest themselves as unnecessary little Xs in empty boxes.

4) Avoid image overload.
While it can be tempting to jam-pack HTML messages with images and photos, the more images you include in your message the longer it will take to download. For your list members with dial-up or other slow Internet connections, this can lead to a frustratingly long wait time to read your e-mail messages! Try to avoid sending image-laden messages and be sure to keep the file size of any images you do include to a minimum.

5) Consider adding an unobtrusive “view Web version” link.
This link offers people an option to view the message as it was intended to look. However, keep in mind that this link does constitute another (unnecessary) barrier between your user and whatever it is you want them to do. Ideally, your message should be created so that it’s not necessary to include a link to a Web version.

WHAT NOT TO DO

Click here to see an e-mail from GoDaddy.com received in a Gmail account. Need we say more?

Eve Fox is Vice President, eCampaigns, and Katelyn Sabochik is a Consultant at M+R Strategic Services

2120 L Street N.W., Sixth Floor

Washington DC 20037

(202) 478-6172

Fax (202) 223-9579

August 2006

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