March 2009

Join Scott Goodstein of Obama for America, Premal Shah of Kiva, and other headliners May 12-14 in the IFC Online eConference—the world’s first online fundraising conference. Unlike its parent, the International Fundraising Congress, held annually in The Netherlands for 28 years, the IFC Online will focus exclusively on online fundraising. For just a fraction of the cost of sending one person to a traditional fundraising conference, you and all your colleagues can take part in three days of live sessions with many of the world’s most successful online fundraisers. Check it out!

1. Year-end giving: cold, hard facts

By Peter Schoewe

If you were expecting the sky to fall as 2008 drew to a close, there’s good news: It didn’t happen. Sadly, however, we found that nearly four out of five of our clients raised less money during that period than they had the year before. Response to acquisition mailings fell 12%, and average gifts declined slightly in house appeals. But the details tell a far more complicated story. Read on . . .

To get a handle on trends in year-end giving for 2008, I aggregated the year-end results of a number of our clients, excluding political mailers and several other organizations. I also confined the analysis to direct mail efforts, in order to measure the effect of the downturn on a channel that is mature and well established for each of the organizations included.

I considered all efforts mailed and all gifts received from the period beginning on October 1, 2008 and ending January 31, 2009, and compared that to the same period a year earlier. A caveat is that the organizations considered for this analysis differ greatly in scope and in mission. In addition, some of the differences observed between the two periods may have been due to strategic decisions unrelated to the economic crisis.

Overall, there was an 18% decrease in revenue through the mail this year-end, with 79% of the organizations experiencing a decline and 21% experiencing an increase. However, the greatest source of the decline was acquisition revenue, which fell 33%. House mailings saw a decrease of 15%.

This decline in revenue was due to several factors. First, many of the organizations acted to protect net revenue by decreasing quantity in efforts that required an investment. This, of course, had the strongest effect on acquisition quantity, which decreased by 25%. Housefile quantity decreased by 12%.

There was mixed news for response rates. We saw a decrease in acquisition response rates, which fell by 12% overall, with 64% of the organizations experiencing a decrease. House mailings, on the other hand, saw response rates increase by 6%. This may have been due to two factors—first, tighter segmentation to focus on the most responsive donors and second, better-than-expected loyalty from existing donors.

For the average gift, these trends were reversed. Acquisition average gifts were up slightly (by 1%), but house appeal average gifts fell by 9%, with 79% of the organizations seeing a decrease. Our experience has been that those mailings that ask for aggressive upgrades have not worked well in the current climate—with many donors continuing to support their favorite organizations, but not being able to increase their commitment.

And now for the bottom line. This year-end, we saw a 3.1% increase in revenue per piece mailed. This is a surprising result considering the extremely difficult economic climate, and reflects the switch in proportion of quantity from less productive acquisition mailings to net-revenue-generating appeals. But this overall result also shows that the bottom did not fall out of direct mail fundraising in the year-end—and illustrates several key points:

• Acquiring new donors is getting tougher as the economy worsens. It’s important to balance the need for current net revenue with the imperative to invest in new donors for the long-term health of your fundraising program.

• A focus on the segmentation of house mailings can help maintain the loyalty of your donors while producing net-revenue growth for your organization.

• Most important, it’s critical to continue to ask your donors for their support, even in the toughest economic times.

Peter Schoewe is Senior Account Executive, Mal Warwick Associates, 2550 Ninth Street, Suite 103, Berkeley CA 94710-2516, phone (510) 843-8888, fax (510) 843-0142, Web www.malwarwick.com, e-mail peter@malwarwick.com.

2. Where's Mal?

March 5-7, 2009 – Arlington VA
National Peace Corps Association Director’s Circle
Site: Hotel Palomar, Arlington

March 24, 2009 – Teleconference
PBS Brown-Bag Teleconference
Fundraising When Money Is Tight

April 14, 2009 – San Francisco CA
Foundation Center
Workshop: Fundraising When Money Is Tight

April 21, 2009 – Washington DC
George Washington University
Guest Lecture: Fundraising When Money Is Tight

April 22-23, 2009 – Washington DC
Global Philanthropy Forum
Site: Mayflower Hotel

April 23-26, 2009 – Itasca IL
Social Venture Network Spring Gathering
Site: Eaglewood Resort

April 30, 2009 – Webinar
Resource Alliance and Forum for Fundraising
Fundraising When Money Is Tight

May 4, 2009 – San Francisco CA
Fundraising Day in San Francisco
Luncheon Keynote: Fundraising When Money Is Tight
Site: Marriott Hotel

May 12-14, 2009 – Online
IFC Online eConference
Workshop: Using online tools to combat the recession

June 16-18, 2009 — Los Angeles CA
Art Museum Membership Conference
Keynote: Fundraising When Money Is Tight
Site: Biltmore Hotel

June 24-27, 2009 – Bangalore India
International Workshop on Resource Mobilisation
Master Class: How to Build a Fundraising Portfolio
Workshop: Recruiting Donors Through Smart Direct Marketing
Site: InfoSys Campus

July 21-23, 2009 – Washington DC
2009 Bridge to Integrated Fundraising Conference
Master Class: The Copy Clinic: Crafting Brilliant Fundraising Letters, Emails, and Telephone Scripts for Breakthrough Fundraising Results
Workshop: The Nitty Gritty of Direct Marketing: Analyzing Direct Mail, Online, and Telephone Fundraising Results
Workshop: Getting Inside the Mind of the Donor
Site: Gaylord Hotel, Resort and Conference Center, National Harbor MD

September 2, 2009 – Phoenix AZ
AFP Greater Arizona Chapter
Luncheon address
Workshops

3. Highlight your partners

By Tom Gaffny

In my year-long study of the online practices of 144 nonprofit organizations, I learned about 12 ways that charities are using the online medium to bring donors closer to the cause . . . again and again. They’re thus making their organizations more relevant, more provocative, more stimulating, and more engaging.

Here, once again, are those 12 techniques:

1. Be relevant—be local

2. Highlight the video

3. Engage constituents

4. Leverage techniques that work in the mail

5. Send information in bite-size chunks

6. Work at channel integration

7. Personalize your organization

8. Be visual—be provocative

9. Say “thank you” in different ways

10. Ask friends to “get the word out”

11. Be timely—be there

12. Highlight your partners

In my previous columns, I addressed the first 11 of these 12 approaches. This month, in the last installment of this series, I’ll cover the twelfth.

Highlight your partners

Rare is the nonprofit organization of any significant size and scope that hasn’t forged partnerships with other nonprofits, commercial enterprises, or both—everything from credit cards to discounted telephone service to insurance offers, or just about anything else under the sun. Often these arrangements languish for lack of attention, bringing only the most minimal benefit to either partner. They’re only worth the effort that goes into them.

Here’s an example of how a high-profile nonprofit organization, the American Lung Association (New York NY), clearly displayed its understanding that the benefits of one such deal would be meager without active promotion.

And here, from Big Brothers Big Sisters of America (Philadelphia PA), is another example of straightforward promotion for a commercial offering that brings it significant revenue:

And here’s yet another example from the American Red Cross (Washington DC):

If you’ve got it, flaunt it!

Editors’ note: Stay tuned for a bonus series of new examples Tom reported at the January 2009 DMA Nonprofit Conference!

Tom Gaffny can be contacted at Tom Gaffny Consulting, 71 Cliff Road, Wellesley MA 02481, phone (781) 685-6825, fax (781) 685-0817, e-mail tomgaffny@hotmail.com.

4. Ask Mal

Since 1994, when the Mal Warwick Associates Web site went online, Editor Mal Warwick has answered fundraising questions posed by visitors to the site. Hundreds of those Q&As are available here. In this feature, we’ll spotlight one Q&A from the most recent month.

Question: I've read that underlining is better than bold or italics. But can you provide some tips for what and how to underline? For example, should I underline complete sentences, the essential phrase, or key words? How much is too much underlining? What should be underlined? Should the key info in each paragraph be underlined so it tells the short story? Or the Ask? And just one or more? Any other tips on underlining from your experience would be helpful!

Mal answers: You’ve pushed one of my buttons with your questions about underlining, but it’s clear you’re on the right track.

There is entirely too much underlining in direct mail fundraising. To emphasize everything is to emphasize nothing. And underlining—along with boldfacing or other visual devices—is nothing if not a way to provide emphasis.

My rule of thumb is to limit the number of instances of underlining to no more than three or four per page. Occasionally, it might make sense to underline an entire sentence—or even, rarely, an entire (very short) paragraph—but, on the whole, I favor underlining phrases or key words.

The objective of providing emphasis in a fundraising appeal is to communicate the principal benefits of sending a gift—to guide the casual reader (i.e., most of us) through the letter without requiring her to read everything in detail.

Sometimes I emphasize the Ask. Sometimes not. It’s all a matter of whether the Ask is structured in such a way as to connect directly to the benefits.

5. Feeling appreciated

By Managing Editor Deborah Block and Paul Karps

When a prospect actually chooses to make a first-time gift to a charity—especially in these difficult economic times—she should feel appreciated. We mean really appreciated!

Because the worst thing anyone should feel right now is taken for granted. So that means every nonprofit should make sure they’re doing as much as possible to welcome a new donor into the fold.

The folks at St. Jude Children’s Research Hospital (Memphis TN) clearly understand this, if their outstanding welcome package is any indication.

The grateful tone of the mailing begins right on the #10 window outer with a huge “THANKS!” in capital letters. There’s a colorful handprint and the teaser, “Your St. Jude welcome materials are enclosed!” The back flap repeats the four-color handprints, along with the line “Welcome to our St. Jude family!” The personalized, one-sided letter definitely gushes—particularly considering the prospect donated just $10. It begins: “I’ve just received the marvelous news—you’re the newest member of the St. Jude family.” But, once again, it’s better to overstate your gratitude these days than minimize it. And since the signer is Marlo Thomas (her father Danny founded St. Jude), this is just the kind of bubbly voice you’d expect from “That Girl.”

Given the economic news of the day, we also like the P.S. “I know there are many worthy charities that ask for your help. Please know how honored we are that you’ve chosen to support the work of St. Jude.”

The package also features a two-sided insert, each with an emotional thank you—one from a former patient and one from a parent, complete with heartwarming photos.

As an added bonus, there’s a nice little premium included: a notepad with the headline “I Love St. Jude!” in a child’s handwriting—with a programmatic message on the back of the pad.

A reply slip features a rather gentle Ask, giving the new donor a chance to make an “extra gift.” Even so, a more aggressive approach is reflected in the monthly giving option that follows.

To see the entire package, click here.

Copywriters Deborah Block and Paul Karps are partners in BK Kreative, 1010 Varsity Court, Mountain View CA 94040, phone (650) 962-1499, e-mail bkkreative@aol.com.

6. Are you (social) networking?

“In November 2008 Facebook drew 200 million unique worldwide visitors; more than 1 in 5 people who accessed the Internet that month visited the site. When sites are that big growth generally stagnates, but in Facebook’s case it’s still skyrocketing. In December, 222 million people visited the site says newly released Comscore stats, a 10.8% month over month growth rate. 22% of the total Internet audience went to Facebook in December.” (Source: TechCrunch)

More than one in five Internet users are visiting Facebook in a given month. Wow!

One prominent nonprofit I know has scheduled a several hour seminar this month to train its program staff on what this social networking “stuff” is all about . . . and how they might leverage it for their advocacy goals.

What are you doing about it?

—Tom Belford in The Agitator

7. The subject is the Subject line

By Ivan Levison

If you’re using e-mail to generate leads or make sales, you’re probably spending a lot of time honing your message and making sure that it’s persuasive.

But do you give equal time, thought, and attention to the short “SUBJECT” line that introduces your main message?

If you don’t, then be afraid. Very afraid.

You see, it doesn’t matter how compelling your e-mail offer is, or how brilliantly your message is written. If your Subject line isn’t working right, your e-mail will never get opened and your campaign will be a failure.

Want to handle Subject lines the right way? Start by thinking of the Subject line as if it were an envelope.

When you’re creating a paper direct mail package, you know you have to come up with a killer envelope. If the envelope doesn’t get opened, the letter doesn’t get read and you don’t make the sale. Same thing with the Subject line. It determines whether the prospect will read your message or trash it.

Of course, getting someone to open a paper envelope is a heck of a lot easier than getting past the Subject line. Why? Because with a paper envelope you have plenty of space to write teaser copy and add photography or illustration if it’s appropriate. You can create something unique that stands out from all the other mail in the pile and screams out benefits that will get the prospect to read the letter within.

Subject lines all look the same and have to be kept short. (Rarely exceed 50 characters including spaces.) This means that every subject line must communicate extremely quickly. Let’s take a look at how to do that.

The right way to write Subject lines.

Here’s a mini case study that shows you how to think about putting a Subject line together.

Check out this Subject line from an e-mail sent by a major marketer that targets small and growing businesses.

SUBJECT: Who’s minding the store?

If you click through to find out more, you get to the message:

“Small businesses are more vulnerable to crime than is generally realized, yet the risks to them are not publicized and too few take steps to protect themselves, says a new study. Don’t wait until you are a victim of a crime—take steps now to thwart the bad guys. Here are a few tips” . . . etc.

So what’s going on here?

Well, the message itself certainly goes on to provide valuable information that small business managers should know. But instead of saying so directly in the Subject line, the writer went for a “teaser” approach:

“Who’s minding the store?”

This teaser subject line might be O.K. in an ad or flyer but is, I would argue, a big loser as a Subject line. Why? Because no benefit is mentioned.

Let’s rewrite the subject line and see if we can do a better job of motivating the reader. How about . . .

SUBJECT: Five ways to prevent store theft

Or, we could slice it and dice it a bunch of ways:

SUBJECT: How to improve store security

SUBJECT: Stop store thieves in their tracks

SUBJECT: Don’t let thieves steal you blind

SUBJECT: Crime prevention basics

SUBJECT: How to prevent store theft

SUBJECT: Guaranteed ways to prevent store theft

You get the idea.

The take-away message this month? The Subject line is a vitally important part of e-mail campaign success and should be the subject of your close attention!

Copyright © 2009 by Ivan Levison. Reprinted with permission. Contact Ivan Levison at 14 Los Cerros Drive, Greenbrae CA 94904, phone (415) 461-0672, fax (415) 461-7738, Web www.levison.com, e-mail ivan@levison.com. Click here to order a free copy of Ivan’s new report, “101 Ways to Double Your Response Rates!.”

8. Do donors want to do anything specific?

By Jeff Brooks

Want to know one problem with fundraising? Quick spin through today’s mail here at the Donor Power Fortress of Charity will show you. Here are the calls to action from several pieces of direct mail fundraising. All are from legitimate, reputable nonprofits. Note the common theme:

• Yes, I want to help [ORGANIZATION] bring medical humanitarian relief around the world. I am making a tax-deductible gift of:

• Yes, I care about the world’s children! To help continue lifesaving programs supported by [ORGANIZATION], I have enclosed a tax-deductible, year-end gift of:

• Yes, I want to support excellence and quality at [UNIVERSITY] with a gift of:

• YES! I want to help fund medical breakthroughs and fight [DISEASE]. Enclosed is my check for:

• Yes! I care about kids in [LOCAL AREA] and want them to enjoy their school days. Enclosed is my gift of:

The common theme is nothing. That’s what these organizations are asking people to do. They’re asking donors to shell out their hard-earned money on nothing specific.

Suppose you got a piece of direct mail from a book seller, and on the reply coupon it said:

Yes! Send me a very special book!

Why is non-specific fundraising so common?

Maybe because nonprofits need to raise unrestricted funds from general donors—their larger institutional donors grab all the specific goodies.

Maybe because they’re afraid they can’t share that much power with donors—donors might not fund the “right” stuff.

It’s entirely possible that in direct response testing, a less specific statement performed better. That happens sometimes. In that case, they should periodically re-test the idea—and make sure the specific and restricted call to action is no less emotional than the general one.

Donors are going to be less and less interested in the non-specific offer. Now is the time to learn how to give them what they want.

Jeff Brooks writes the Donor Power Blog for Merkle Domain.