May 2006
by Dana Hines
Answer Man: Do Personal Notes Make a Difference?
by Marc Sloop
Donorspeak: Tracking the waves and the currents
by Dirk Rinker
Online: Online fundraising benchmarks!
by Madeline Stanionis
Hands On: Writing a Creative Brief
by Tom Ahern
What's Working: Marketing the Concept
Copy Corner: Institutional approach with a twist
by Deborah Block and Paul Karps
Pre-emptive renewals
by Dana Hines
ACQUIRING new members or donors is one of the biggest challenges in the fundraising world- and typically the most costly. The second most difficult task may very well be getting these new supporters to renew their commitment for a second year. In fact, if first-year renewal rates are about half that of longer-term members and donors.
So when one of my firm's clients, the Missouri Historical Society (St. Louis MO), doubled its membership from 9,000 to nearly 18,000 in just nine months- a result of its immensely popular 2004 exhibition celebrating the National Bicentennial of the Lewis and Clark Expedition- our task became clear. How would we renew these newly found MHS members at the anniversary of their original join date?
RENEWING THE BLOCKBUSTER MEMBER
The challenge of getting blockbuster members to renew is one faced by organizations across the country- every time they have a monumental event, exhibit, or new building opening that captures the attention of the masses. Some groups report first-year renewal rates of just 10%. A local survey among peer institutions of MHS indicated a 16-26% renewal rate for members who first joined in similar, blockbuster circumstances. This compares to a typical first-year renewal rate of 40-50% for members who haven't joined during a blockbuster event.
TURNING TO THE TELEPHONE
In lapsed member and donor campaigns, it's common to use the phone to recapture these wayward supporters. However, by definition, this is done after the member or donor has refused to renew. The bold decision made for MHS was to use the telephone to talk to new members before they could say "no"- and ask them to renew before the standard three- or four-part renewal series was launched.
It's often said that new supporters should feel engaged with the organization in their first year. Being involved and participating in programs helps ensure that the new member or donor feels as though she truly "belongs" to the group's cause or mission. The planned phone call was seen as a way to make sure the supporter was taking full advantage of what MHS had to offer- and felt welcome and part of the membership family. The phone contact with new members was made in about the eighth or ninth month of their membership year.
The script was written to encourage an exchange about their membership experience to date. What's more, the thrust of the rapport-building phase of the conversation included a discussion of how the exhibit that drew them to become members in the first place was just a taste of what was in store for them- especially through upcoming programs and additional opportunities to participate.
THE ASK
Members were then asked to renew their membership and to do so right then using their credit cards. Members were offered a free gift if they renewed- and another incentive if they used their credit cards to complete the transaction on the phone. An average of 35% stated they would renew, and of those, 42% were willing to complete the transaction using credit card s. The average gift was $58.09. The cost per dollar raised was $0.3l.
Credit card pledge fulfillment is the key to success in phone campaigns of any type. The credit card fulfillment rate is 100%, while non-credit card fulfillment is about 50%. The special offers are critical to raising the credit card rate. The campaign more than pays for itself on the credit card renewals alone.
FIRST-YEAR RENEWAL RATES
The full year of renewals of the blockbuster members is now complete. The phone contacts were followed by the organization's usual set of renewal contacts-four mailed renewal notices. The first-year renewal rate from all contacts stands at 40% and is still maturing.
CONCLUSION
The valuable lessons learned with MHS can be applied in similar situations where there's significant growth in new members or donors. Here are a few bits of advice to maximize first year renewals:
Don't:
-Treat new members and donors the same as long-term members. New people need added attention!
-Assume that first-year members or donors are a lost cause. Added attention will translate to better results and revenues.
-Give up- adding even more contacts on the back end. An extra mailing, call, or e-mail will continue to boost the renewal rate throughout the year after.
Do:
-Make that call. Having a personal conversation during the first year strengthens the relationship.
-Offer incentives to get people to renew and to get them to use their credit cards to "seal the deal" at the time of the conversation.
-Track first-year renewal rates separately from multi-year renewal rates. Paying close attention to first-year renewal rates and pulling out all the stops to increase renewals from this very fickle crowd is worth the effort. Organizations that put forth this extra effort will solidify their base and ensure continued growth over the years.
Dana Hines is President of Membership Consultants
3868 Russell Blvd.
St. Louis MO 63110
phone (317) 771-4664
e-mail: dana@membership-consultants.com
A longer version of this article first appeared in the January 2006 edition of Arts Reach. For more information, phone: (800)793-3342, Web: www.artsreach.com.
Do Personal Notes Make a Difference?
by Marc Sloop
THIS QUERY COMES FROM Mike Lapham, who works at United for a Fair Economy (Boston MA), a national nonprofit concerned with the growing income and wealth divide in the U.S., as well as racial and economic inequality.
Mike likes to write a brief personal note on every annual membership appeal, which probably takes him a minute per letter. He has about 400 membership letters that go out. Recently, he did an experiment where he wrote personal notes on half the letters and nothing on the others. A great concept for a test!
Of the half with notes, 50 renewed. Of the other half, only 38 renewed. So that means he got an extra 12 renewals at roughly $200 each. He thinks $2,400 is not bad for three hours extra work.
His questions: Is there lots of evidence that personal notes make a difference? How much difference? Does it depend on the gift level, or is it true for all levels? How would you go about deciding whether to personalize appeals or which ones to personalize?
My answer: The trouble with an example like this is that the sample size is so small that one can't really make a statistical claim about the results, with a difference of only 12 responses between the two groups.
So that leaves us in the realm of anecdotal evidence, and major gift officers are always quick to say that more personal attention is better. I agree, though it's hard to "prove." A general guideline I've used is that you should give personalized attention to as many members as possible.
Many clients at Mal Warwick Associates have successfully used the services of Aria Communications (St. Cloud MN), a company that specializes in handwritten packages, both for the mailing address on the outer envelope and as a signature and P.S. on the letter. These mailings always do much better than their nonpersonal counterparts, but they cost a lot more as well. When used on targeted segments, it's a good way to deliver personal messages to your supporters without getting a hand cramp and watching your signature turn into a physician - like slash of ink.
Gift level doesn't really determine how recipients will respond. People appreciate personal attention no matter how much they've given (and, truly, $150 may be a lot for one person, but trivial to another). Though it does matter when deciding who's getting this personal attention. Six hours of extra work for 400 members is easily manageable for one person, and obviously worth the extra effort.
You'd think differently if you had 4,000 members, or 40,000 members. That's when giving levels are used, and organizations typically choose to treat their higherdollar donors with more attention. This sort of special care is a lot like space advertising, where there's no real way to measure response to a specific message. But you know you're better off doing it. And every organization has a story about the little old lady who left it a fortune in her will, but was only a $10 donor for years and years. These stories are quite true, and I think best illustrate the reasons behind giving personalized attention to as many members as possible, because you never know where the money will come from.
Tracking the waves and the currents
BY DIRK RINKER
ON THE MOST simplistic level, donor behavior occurs as a reaction to some trigger event—a sort of cause-and-effect relationship. Though not a deep, psychological explanation, this is how donors (who rarely think deeply about their giving) see it and report it. However, like an iceberg with 90% of its mass underwater, we know that behavior is influenced in ways that are not immediately visible.
A recent survey my firm conducted among 3,000 lapsed and active donors shows they were very unlikely to view any event in their personal lives or in the world around them as causing a decrease in their giving behavior. Yet they were much more likely to say that not giving was triggered by their perceptions of a nonprofit.
This research supports the notion that giving is “all systems go” until some barrier influence rises up to challenge the emotional motivation. My colleague Adrian Sargeant of the University of Bristol in England has developed a comprehensive map of donor behavior that shows how a donor, before reaching a decision to give, goes through a veritable gauntlet of attitudinal influences.
These influences have an enormous impact on donor behavior. The things your organization does to trigger the donor’s decision process are like waves hitting the top of the iceberg—a lot of visible activity, but little immediate impact on the direction the iceberg takes.
The thing is, the waves are what fundraisers typically measure. We can easily see them and their impact. Unfortunately, fundraisers rarely measure the currents. And the currents that flow beneath the surface have the power to stop the iceberg in its tracks, or force it in a completely new direction. Like deep ocean currents, donor attitudes have much more influence on the direction of a donor’s behavior than they are credited with.
Certainly, donor attitudes are quite complex. Sargeant’s excellent model shows us that perceptions, experiences, habits, heritage, and values all shape the donor’s reaction to your nonprofit’s appeal.
These attitudes work both ways. Just as they supply the principal momentum to any donor’s loyalty to a nonprofit, they are also the first line of defense in checking the emotional impulse to give. So, in addition to measuring the impact of the “waves,” it makes sense to measure the
“currents.” In fact, by measuring the currents of donor attitudes, we can predict in most cases which direction our donor will travel— toward future gifts or away from them. All of this begs the question, “Which donor attitudes should we measure?”
According to Sargeant, “ Research among nonprofits shows satisfaction and commitment to have a strong positive impact on donor behavior and retention, and that the optimum solution for predicting future behavior is to measure both.” Our research backs up this claim, especially for mass fundraisers. However, donors acquired through events, personal solicitation, or friend-to-friend efforts are likely to have different satisfaction drivers. Sargeant adds that the “essential drivers of satisfaction and commitment are dimensions that are . . . relevant to every direct marketing organization. While the basic questions may not address every facet of service quality, they don’t have to.”
Armed with a few satisfaction and commitment insights from a short survey instrument, an organization can predict the future behavior of about 80% of surveyed donorsbased on comparing survey responses to subsequent giving over the long term.
Next time, I’ll discuss how an organization might actually begin to measure satisfaction and commitment on an ongoing basis and use the findings to develop stronger relationships with donors.
Dirk Rinker is President, Campbell
Rinker, 25600 Rye Canyon Rd.,
#202, Valencia CA 91355, phone
(888) 722-6723, fax (661) 775-5926,
e-mail rinker@campbellrinker.com.
Online fundraising benchmarks!
BY MADELINE STANIONIS
WONDERING how your online response rates compare? If so, you’ll be interested in the new “eNonprofit Benchmarks Study,” the first detailed look at the hard numbers for nonprofits using the Web for fundraising and advocacy.
The good news: It’s free! Download the report at www.e-benchmarksstudy.com.
The report studied 15 national nonprofits in the environmental, civil/legal rights-based, and international aid sectors in depth, and surveyed another 85 organizations. Many of the results aren’t surprising. For example, did you know that organizations with big e-mail lists raise more money online? Well, yes, of course. But the report also demonstrates that smaller organizations are meeting success through innovation and aggressive efforts. However, more than anything else, the report shows how young online fundraising is: We still have a lot to learn! This report is just the beginning. I do encourage you to read it for yourself. For now, here are some key findings:
-Investment pays off: Organizations with larger online communications budgets built larger e-mail lists, generated more advocacy activity, and raised more funds online. Duh!
-E-mail open rates in decline: E-mail message open rates averaged 26% between September 2004 and September 2005, a decline from the previous 12-month average of 30%. Average response rates to e-mail advocacy appeals were 10%, while average response rates to e-mail fundraising appeals were just 0.3%.
-E-mail lists continue to grow — and shrink: List churn (where e-mail addresses becoming undeliverable or unsubscribed) is a considerable problem for organizations. Nonprofits studied recruited on average more than twice the size of their existing e-mail lists over a 12-month period, yet their overall list growth was only about 73% as some new recruits are offset by heavy e-mail list loss.
-Online actions speak louder than dollars: More e-mail subscribers took online action than made an online donation. Between September 2004 and September 2005, an average of 47% of all e-mail subscribers took at least one online action, while just 6% of up of 61% activists, while just 4% of their subscribers made an online donation.
-A rise in online fundraising: Despite modest online donation rates, online annual fundraising totals increased by 40% on average from the year before, likely driven (in part) by the public’s overwhelming response to the Asian tsunami disaster. Participating organizations averaged $2.5 million in online donations last year, with a $97 average gift.
DOES SIZE MATTER?
It might appear from these findings that size does indeed matter—two-thirds of organizations studied in-depth have online communications budgets over $300,000 per year. However, the study also found that organizations of any size could achieve meaningful results through innovation and aggressive efforts. The key? Taking the time and effort to track results closely, learn from successes and failures, and put those lessons to use.
By the way, the study was produced by M+R Strategic Services and the Advocacy Institute, and co-sponsored by my firm, Donordigital, and a number of other companies. Additional funding was provided by the Beldon Fund and the Surdna Foundation.
Madeline Stanionis
Donordigital
President and Creative Director
182 Second Street, San Francisco
CA 94105
phone (415) 278-9444
fax (415) 901-0112
www.donordigital.com
madeline@donordigital.com
She’s the author of The Mercifully Brief Real-World Guide to Raising Thousands (if not Tens of Thousands) of Dollars with Email (Emerson & Church, Publishers).
“Most of us know we should listen carefully to everything our donors say, and most of us think we’re great listeners. I doubt it. As a recovering interrupter, I know that great listening is not something that just happens. We have to work at it, and few of us know how to do that.
“Great listening also requires skill in asking quality questions, the questions that unlock the information we need in order to increase our donors’ motivation to give and decrease or eliminate the obstacles preventing a joyful ‘Yes.’ Honing your skills in listening for intent and asking quality strategic questions will help take even the savviest practitioner to a higher level of success.”
Thanks for this tip to consultant Karen Osborne, presented at the International Fundraising Congress. Send your own Tip or Timesaver by e-mail to mal@malwarwick.com, or mail to:
Mal Warwick’s Newsletter,
2550 Ninth Street, Suite 103,
Berkeley CA 94710-2516.
In return, we’ll send you a free copy of Mal Warwick’s Testing, Testing, 1, 2, 3: Raise More Money with Direct Mail Tests (Jossey-Bass, 2003), an indispensable tool for direct mail fundraising.
Writing a creative brief
BY TOM AHERN
READERS of this newsletter tend to be professional fundraisers, not advertising folk. So there’s a good chance you’re unaware of a profitable little trade secret called “writing a creative brief.” (Brief as in “briefing.” Brief as in “short,” too.) In advertising, the creative brief guides the
efforts of writers and designers. It gets everyone on the same page (literally) and answers the questions:
-Why are we doing this?
-What are we trying to accomplish?
A creative brief talks about the target audience. It talks about the ad’s special message. And most important, it talks about action: what the ad will cause the target audience to think, feel, or do. Now let’s jump to the exciting conclusion: If writing a creative brief is a proven secret of success in advertising, you’ll be thrilled to hear that it’s also a secret of success in fundraising communications. And it doesn’t matter what kind of fundraising, “friendraising,” or reputation building communication you have in mind. Whether it’s an appeal letter, case statement, newsletter, membership offer, annual report, Web site, brochure, press release, fact sheet, or bumper sticker, for that matter: Anything will be more effective when it’s based on a creative brief.
Writing a creative brief is easy. First, answer these three questions:
1. Who is your specific, target audience?
2. What do you want that target audience to
do once they’ve read your communication?
3. What’s in it for them if they do the action you’re proposing?
Then take that information and fill in the blanks in the following statement:
This [enter name of communication item] will convince [enter name of target audience] that [enter name of action you want them to take could [enter the benefit, what’s in it for them]. Here are three examples of creative briefs:
-[For a community symphony selling season tickets] This brochure listing our upcoming season’s musical offerings [the communication item] will convince music lovers in the Cape Cod region [the target audience] that buying a season subscription [the action you want them to take] will give them enjoyable, exciting, professional level musical experiences without the hassle of driving into Boston [what’s in it for them].
-[For a new fund at a community foundation] This case statement [the communication item] will convince feminists of both genders [the target audience] that supporting the Women’s Fund with their gifts [the action you want them to take] will help level a very unfair playing field in Rhode Island [what’s in it for them].
-[For a mental health agency doing outreach] This ad [the communication item] will convince parents who are having problems with their teenagers [the target audience] that one phone call [the action you want them to take] could improve their lives [what’s in it for them].
Note in that last example that the benefit is a bit vague. That’s OK. In fact, for many fundraising communications, the benefit that ends the creative brief is simply some version of “. . .will make the world they care about a better place.”
Last word: Creative briefs have been compared to road maps. They show you how to get to where you want to go. I’m a true believer: I write some form of creative brief for every job I’m hired to do. After all, organizations pay me good money to get results. I can’t imagine attempting that kind of journey without my trusty map.
Freelance copywriter Tom Ahern is the author of the new book, The Mercifully Brief Real World Guide to Raising More Money With Newsletters Than You Ever Thought Possible (Emerson & Church).
He can be reached online at A2Bmail@aol.com or by phone at (401) 397-8104.
This article is adapted and reprinted with permission from the Ahern E-News.
CARRYING THROUGH with a Marketing Concept—from the outer envelope to the reply envelope—should be a priority for every direct mail package. That said, how often do you actually see the Marketing Concept consistently presented in each component? Not often enough!
But in the case of the Martin Luther King, Jr. Memorial Foundation (Washington DC), the overall message—an invitation for the recipient to become a Founding Sponsor of a national memorial dedicated to Dr. King— rings clear throughout this thoughtful and well-written mailing.
The 6 x 9" outer envelope, which introduces the group’s attractive logo and “Build the Dream” tagline, includes the simple teaser, “Enclosed: A Special Invitation.”
The four-page letter continues the invitation with “I am writing to ask you to become a Founding Sponsor of the Martin Luther King, Jr. National Memorial.” (Yes, to really stand out, these words are boldfaced throughout the letter.) Later on the page, the theme continues with the direct Ask: “Will you join Mrs. Coretta Scott King, Ambassador Andrew Young, National Basketball Commissioner, David Stern, Vernon Jordan, Presidents George H.W. Bush and Bill Clinton and others as a Founding Sponsor?”
Grammatical and formatting mistakes aside, there’s definitely someone for every potential donor to identify with here! Page two also includes another direct Ask: “So please don’t delay. Sign the enclosed Founding Sponsor Acceptance Form and return it to me . . .” Similar language is found on page four, as well. And to cap it off, each of the four paragraphs of the P.S. includes the words “Founding Sponsor.” The “Founding Sponsor Acceptance Reply” appropriately hammers the same message. And a four-color brochure provides additional information about the memorial—along with “Founding Sponsor Benefits.”
Kudos, too, for the reply envelope that announces in bold capital letters: “FOUNDING SPONSOR ACCEPTANCE REPLY ENCLOSED PROCESS IMMEDIATELY.”
To view the entire Martin Luther King, Jr. Memorial Foundation package, click here.
Institutional approach with a twist
BY DEBORAH BLOCK AND PAUL KARPS
MORE OFTEN than not, when we’re asked to write an acquisition package for a cultural group—a museum, theater, aquarium, or other such institution—the package tends to adopt a “what’s-in-it-for-me” perspective. As in, what can the recipient expect to gain by sending money and becoming a Member. This turns the focus on all the things the prospect can expect to see, participate in, and enjoy—whether that be special exhibitions, an exclusive event, workshops and classes, or a host of tangible goodies. Along, of course, with a rundown of the intangible benefits associated with giving to a good cause.
However, sometimes we’re asked to downplay this broad, benefits-driven approach. Instead, our direction is to write more of a mission-based package. This is something we generally characterize as reflecting an institutional approach. That means thinking in the following terms: “We’re a great institution that serves this community well. But to do even more, we need the support of people like you . . .”
The trick is to avoid writing what’s commonly referred to as “manufacturer’s copy.” This is copy that reads more like a company press release, advertisement, or annual report than it does a fundraising solicitation. And it reeks of self-congratulatory sound bites, selfpromotion, and general chest thumping.
So if your job is to write a package with an institutional-style approach, our best suggestion is to sneak in some key elements of the what’s-in-it-for-me style. And here are a few ways to do this:
PUT THE PROSPECT IN THE ACTION
Rather than merely reciting all the reasons your organization is so wonderful—we do this, we do that, we even do that other thing—go out of your way to get the prospect involved in who you are and what you do. For example, instead of saying, “The Museum’s education department reaches out to over 50,000 schoolchildren each year through . . .” try this on for size: “With your generous contribution, you can help the Museum reach out to 50,000 schoolchildren . . .”
In other words, by placing the prospect in the middle of the action, you’re turning a statistic into an intangible benefit. Send money and feel good about helping children. It’s sort of a jazzy way of turning a feature—we educate kids—into a benefit for the prospect. And like any marketer will tell you, benefits sell . . . not features.
TAKE THE PROSPECT’S PERSPECTIVE
Along these same lines, when you find yourself describing what’s inside the museum, make a point of writing the copy from the reader’s perspective. “As you walk inside our architectural masterpiece, you’ll discover. . .” Or “you’ll be captivated by our world-class collection of . . .”
Or the proverbial, “You absolutely won’t want to miss . . .”
The whole idea, once again, is to be able to convey what a great organization you are, but to do it in a way that doesn’t come off as boastful or obnoxious. And presenting these sorts of descriptions from the perspective of the reader will tend to minimize that risk.
APPEAL TO CIVIC PRIDE
If your underlying theme is that a gift will help improve your community, you’ll need to remind the reader that she’ll be helping herself in the process. Stress, for instance, that increasing the museum’s collection will enhance the cultural reputation of the prospect’s own city and region.
Managing Editor Deborah Block and Paul Karps are partners in BK Kreative
1010 Varsity Court
Mountain View CA 94040
phone (650) 962-9562
fax (650) 962-1499
