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“OK, So Now What?”
5.15.13
Tom Gaffny
[email protected]
Direct Marketing 201
3 THINGS
WE NEED TO
STOP THINKING,
AND STOP DOING
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Direct Marketing 201
You Don’t Have
a Donor Base–
In fact, the opposite is true.
You Belong to the Donor
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Direct Marketing 201
3 Things We Need to Stop Thinking
and Stop Doing
1. We need to stop thinking we own the
relationship with ‘our donors’ … because we
don’t.
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Direct Marketing 201
The Fundraising Dialogue
Sender
Receiver
- What you send
- When you send it
- Which channel
-
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Whether to open
When to open
Whether to read
Whether to respond
When to respond
How much to give
Which channel to use
Direct Marketing 201
You’re in Charge, Huh?
• This month … the average donor is going to
be awake 29,000 minutes
• During that time she’ll get over 50,000
marketing messages
• If she pays attention to your communication,
she might give you 5 of those minutes
• 17% of people even open their emails
• Direct mail … oftentimes less
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Direct Marketing 201
BUT WE INSIST ON THINKING IT’S ABOUT US
• We ACQUIRE Donors …
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Direct Marketing 201
BUT WE INSIST ON THINKING IT’S ABOUT US
• We ACQUIRE Donors … ‘hostage-taking’
phase
• We RECAPTURE them, if they lapse
‘Why Have You Foresaken Us?’ letter
• Put them through a CONVERSION program
Our language reflects our attitude
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Direct Marketing 201
The American Donor Public Is Suffering From
Battered Donor Syndrome
Craving a relationship that’s more about them
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Direct Marketing 201
The American Donor Public Is Suffering From
Battered Donor Syndrome
Craving a relationship that’s more about them
(and unless we embrace their feelings,
we’re screwed)
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Direct Marketing 201
Proof the public craves a relationship
that’s more about them?
Introducing one of the hottest new
acquisition offers in the past 5 years…
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Direct Marketing 201
Interesting, huh?
The Offer that explicitly promises
We Don’t Want a Relationship,
Is Very Successful at
Starting a Relationship
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Direct Marketing 201
Why Does This Work?
- Because this offer tells the donor ‘you’re
in charge of this relationship’
The donor’s need for control is that deep
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Direct Marketing 201
Proof the public craves a relationship
that’s more about them?
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Direct Marketing 201
Making it all About the Donor:
• Food for the Poor contacted thousands of
donors in and around Boston area. But that’s
nothing new…
• Hurricane Sandy: Called more than 11,000
donors – followed up with prayer option
• Sandy Hook in CT: Contacted more than
25,000 donors
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Proof the public craves a relationship
that’s more about them?
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The Results:
• More than 25% of people responded
• Generated more that $171,000
• Giving from 20 year+ donor core has been
increasing for the first time in years
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Direct Marketing 201
Yes, even this is Proof….
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Direct Marketing 201
The one tactic that lifts response every time.
Three Recent Examples
• Charity A – Multiple stamps lifted net revenue
92%
• Charity B – Multiple stamps lifted net revenue
51%
• Charity C – Multiple stamps lifted net revenue
44%
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Direct Marketing 201
This Isn’t Just About Tactics.
And It’s Not Just About Postage.
• This works because it’s one of the few
things we ever do for the donor
• It’s about their convenience, their
ease, their pocketbook
• Outgoing 1st class = for us
• Return 1st class = for the donor
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Direct Marketing 201
The Nonprofits
that Recognize the Donor
OWNS THE RELATIONSHIP
Will be the Biggest Winners in the
Decade Ahead.
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Direct Marketing 201
A PROFOUND ATTITUDINAL SHIFT:
• Identify the people who really matter
• Commit to a true donor-centric approach
• Focus on engagement and donor service
• A zealous commitment to nurturing the
relationship
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Direct Marketing 201
3 Things We Need to Stop Thinking
and Stop Doing
1. We need to stop thinking we own the
relationship with ‘our donors’… because we
don’t
2. We Need to stop relying on the same old
one-dimensional pyramid
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Direct Marketing 201
Transaction Pyramid
Giving Profile
High
Value
• Recency
• Frequency
• Amount
Low Value
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Transaction and Action Pyramid
Activity Profile
Giving Profile
• Recency
High
Value
• # of channels
• Frequency
• Volunteer?
• Amount
• Special Events
Low Value
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Transaction and Action and Attributes
Pyramid
Giving Profile
• Recency
• Frequency
• Amount
Attributes
• Age
• Wealth
• Health
High
Value
Activity Profile
• # of channels
• Volunteer?
• Special Events
Low Value
You Know How To Rank Her
But Do You Know
How She Ranks
You?
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How Do You Rank in Her Pyramid?
• Are you a Priority in her life?
… or just one of many?
• Does she give you more than she gives to other
charities … or less?
• Is it unusual for her to support you?
… or does she throw a few dollars at everyone?
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How She Supports
Other Charities
Also Tells You How Much
She Values You
How You Rank.
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Passion Pyramid
MRS. SMITH
• Gives to only 2-3
charities
High
Passion
• Gives you twice
as much as she
gives to others
MRS. JONES
• Gives to lots of
organizations
• Gives more to
others than you
Low Passion
Who’s More Passionate About You?
MRS. SMITH
• Gives to only 2-3
charities
High
Passion
• Gives you twice
as much as she
gives to others
MRS. JONES
• Gives to lots of
organizations
• Gives more to
others than you
Low Passion
Real World Example #1
• National organization launched a Planned Giving campaign
• Selected ‘High Passion’ names who did NOT meet their
longstanding planned giving select criteria
Value
Pyramid
Passion
Pyramid
Low Passion
Low Value
% RESPONSE FROM THAT SEGMENT – 3 TIMES OVERALL CAMPAIGN
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Real World Example #2
MRS. SMITH
MRS. JONES
MRS. YOWZA
$25
$25
$25
OVERLAY HISTORY WITH OTHER CHARITIES
Gives once to others
But never again
Gives to others
But never upgrades
18 Times
More Net
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2 times as much to
you as other orgs
30 Times
More Net
We Need to Have A
Data Dialogue with Donors
CAMPAIGN VIEW
How We Rank the Donor
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We Need to Have A
Data Dialogue with Donors
DONOR VIEW
How They Rank You
CAMPAIGN VIEW
How We Rank the Donor
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‘You-centered’ Modeling and Analysis
Will Be the ‘Dividing Line’ Tool
• Will separate the winning charities from the
losers in the decade ahead
• Historically focused on ‘saving money’ – needs
to shift more to optimizing relationships
• “We can’t afford to invest in this”???
You can’t afford NOT to invest in it.
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Direct Marketing 201
3 Things We Need to Stop Thinking
and Stop Doing
1. We need to stop thinking we own the
relationship… because we don’t
2. We Need to stop relying on the same old
one-dimensional pyramid
3. We need to stop believing acquisition is the
main key to growing our file
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Direct Marketing 201
We may be the
ONLY INDUSTRY
In the world
That doesn’t view
RETENTION
as the key to growth
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Direct Marketing 201
The most important goals for nonprofit
communications strategies in 2013
57%
Acquiring New Donors
52%
Engaging Our Community
45%
General Brand Awareness
30%
Retaining Current Donors
Thought Leadership / Positioning as an Expert
22%
Creating Website Traffic
22%
20%
Acquiring New Program Partipants
18%
Building Print or Email List
12%
Acquiring New Volunteers
7%
Retaining Current Participants
All Other Responses
4%
0%
10%
20%
30%
NonprofitMarketingGuide.com survey
40%
50%
60%
The most important goals for nonprofit
communications strategies in 2013
Acquiring New Donors
Engaging Our Community
General Brand Awareness
30%
Retaining Current Donors
Thought Leadership / Positioning as an Expert
Creating Website Traffic
Acquiring New Program Partipants
Building Print or Email List
Acquiring New Volunteers
7%
Retaining Current Participants
All Other Responses
0%
5%
10% 15% 20% 25% 30% 35%
NonprofitMarketingGuide.com survey
THE BIGGEST ISSUE TODAY ISN’T ACQUISITION
It’s FILE GROWTH.
And RETENTION is the key to file growth.
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The RETENTION Growth Case
IMAGINE IF 4 YEARS AGO…
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The RETENTION Growth Case
IMAGINE IF 4 YEARS AGO…
Option #1: - Invested heavily in acquisition
- Status Quo in Multi-year retention rates
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The RETENTION Growth Case
IMAGINE IF 4 YEARS AGO…
Option #1: - Invested heavily in acquisition
- Status Quo in Multi-year retention rates
Option #2: - Cut acquisition 25%
- Invested in multi-year retention;
increased rate 2%
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ASSUMING …
Your Program Matches Industry Standards
− First Year Retention rate of 25%
− Second Year Retention rate of 40%
− Multi-year Retention rate of 65%
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For Most Files I See:
OPTION #2 would:
- Give you as many (or even more) donors
- Result in more ‘multi-year’ donors
- Result in far more net revenue
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KEYS TO RETENTION:
Commit to Greater investment, focused on:
• Truly knowing your best supporters; their
interests, their needs
• Using the Whole pyramid: Transactions, Actions,
Attributes … and Passion
• Nurturing true relationships through superior
donor service
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Direct Marketing 201
Thank You!
Tom Gaffny
[email protected]
Direct Marketing 201
3 Things We Need to Stop Thinking
and Stop Doing
1. We need to stop thinking we own the
relationship… because we don’t
2. We Need to stop relying on the same old
one-dimensional pyramid
3. We need to stop believing acquisition is the
main key to growing our file
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Direct Marketing 201
But aren’t all the old donors dying?
(Don’t tell them)
Life Expectancy:
85
87
88
90
92
Age:
65
70
75
80
85
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Profile Data
Passion Ranking
High
Value
High
Passion
Low Value
Low Passion
How You Rank Her
How She Ranks You
Profile Data
Passion Ranking
High
Value
High
Passion
Low Value
Low Passion
How You Rank Her
How She Ranks You
Profile Data
Passion Ranking
High
Value
High
Passion
Low Value
Low Passion
How You Rank Her
How She Ranks You
THE REALITY:
The one tactic
that makes it easier for the donor,
Is the one tactic
That makes the biggest difference.
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Proof the public craves a relationship
that’s more about them?
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Direct Marketing 201
Dear Fundraiser,
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Dear Fundraiser,
“Don’t talk to me like that, OK?”
Sincerely,
American Boomer
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Dear Fundraiser,
“Don’t talk to me like that, OK?”
Sincerely,
American Boomer
P.S. I’m really getting to hate name labels.
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The ‘Winning’ Subject Line:
“Hey”
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“It quickly became clear that a casual
tone was usually most effective. The
subject lines that worked best were
things you might see in your in-box
from other people,” Fallsgraff says.
“‘Hey’ was probably the best one we
had over the duration.”
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Direct Marketing 201
Real World Example #1
• National Health organization
• Important mailing to ‘higher dollar’ audience
• What if they expand audience –target people
with low-tier RFA … but high passion?
Value
Pyramid
Low Value
Passion
Pyramid
Low Passion
Real World Example #1
• Mailed $25-49 high passion names
• 150% higher response than w/o
segmentation
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The Reality:
Your donor doesn’t belong to you.
You belong to her.
And unless we do more to embrace
this mindset, we’re screwed.
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Direct Marketing 201
92% lift in NET income.