Best Practice and New Developments in Appeals
By Fiona McPhee, Pareto Fundraising, MFINZ
Cash income has been growing steadily for New Zealand charities over the past 10 years. This growth has been driven primarily and consistently by direct mail. In 2014 aroudn 20 percent of this cash income came from newly acquired donors, the rest from previously recruited donors.
For most charities, the bulk of this cash income is generated through appeals (some of you may call them campaigns, what I'm talking about is an activity where you send a donation ask to a selected audience). The majority of these appeals are executed via direct mail.
Here are a few ideas for you to consider to continue to improve your appeal returns and overall program.
What amount you ask for
From a best practice perspective, how you develop and present asks to your donors in your appeals has a huge impact on your average gifts and your ability to increase each donors average giving level over time.
My first tip is to make an ask for a specific amount, and repeat this throughout your appeal. Testing shows this improves response, and if your asks are based on each dnor's previous giving, then they are not viewed by the donors as wildly inappropriate suggestions.
Fiona will you please send a gift of $100 today, which could help rebuild and equip three of our most run-down training centres?
Standard practice has been to 'band' donors based on previous giving (say all donors with a last gift between $100 and $500 are in one band and so forth) and giving a set ask to each band e.g. the $50 to $100 band all get asked for $65.
This approach is preventing you from maximising income from each donor. Donors are lovely and they mostly do what is suggested to them. For example, if you ask me for $65 and have justified how that will help I'll likely give you $65, even if I gave $100 last time. You have now just reduced my value.
Far more effective is basing each donors ask on their own previous giving. If I gave $75 last time, my ask should be based on this. If I gave $120 last time, then my ask is based on this.
This approach allows you to then test multipliers. For example asking me once a year for 1.5 times my last gift provides me with the opportunity to increase my giving, at a level not out of the realm of my recent giving.
One of the simplest ways you can manage cost and effort in your appeals program is to send a reminder mailing four weeks after your initial appeal. Four weeks appears to be optimal from the testing I've done.
This is not a new appeal or creative, but the same pack or a variation of it (but still the same proposition, story and general execution - having tested completely reworking the creative against simple adaptations it's not worth the effort or resources to do a full rework).
If we assume you get a 15% response rate to your appeal mailing, its unlikely 85% of those mailed got the pack, opened it, read it, considered your request and then chose not to give.
A decent proportion will have never seen the pack - it's the nature of direct mail (or email for that matter).
A reminder mailing increases your chance of more people receiving your ask. And for those who did read it the first time it reinforces 'the ask'. Your second wave or reminder should go to a smaller set of donors - tighter targeting to your best prospects.
Test how wide you send the reminder mailing, the goal is more net income. It will cost you more overall but you will make more net for your cause.
It's been a buzz word the past few years. Integrating your fundraising message across multiple channels feels logical. For an appeal the idea is to keep the same proposition and consistency in theme, stories,a nd imagery across channels.
I have seen the addition of channels, and options within these channels, increase returns - in some cases dramatically and in others incrementally. But they also increase costs.
Testing and applying your learnings is critical.
Understand where your audience is and prioritise these channels for testing.
This will allow you to build your experience and expertise in execution and not spread yourself too thin.
Critical to any attempt at integration is getting your key channel right first, and for most of us that is direct mail. Ask yourself the question: Am I maximising the potential from what I'm already doing? If the answer is 'no' integration needs to wait.
From here the next best step is integrating channels where you available audience is found. So for those whose main channel is direct mail a proportion of your donors will already, or will have the propensity, to give online, and this volume will be increasing year on year.
If you do not have in-house expertise, seek external advice for implementing best practice support for your appeals online. How you use your homepage and having a best practice appeal donation landing page are absolute critical minimums for extending your appeal online.
Another option is the phone, and if you start focusing on your high value donors a phone follow up almost always reaps a net reward (when specific donation asks are made).
Fiona McPhee is the Strategy Director for Pareto Fundraising working with a range of New Zealand charities on the development and execution of their appeals programs. You can contact her at firstname.lastname@example.org