Direct Mail Still King
December 3, 2012 Patrick Sullivan
Consumers love to comparison shop. That goat’s milk cheese might be one price in the New Artisanal Premium Cheese Catalog but slightly less from Dean & Deluca’s catalog.
Well, what about the whole goat?
A donor will find it costs $75 to give the gift of a goat through World Vision, $90 through Food for the Poor, and $120 with Heifer International.
Consumerism has truly hit the nonprofit space.
No month is better than December for fundraising for Food for the Poor, when the organization earns about 20 percent of its yearly revenue. A holiday gift catalog is a huge driver of year-end donations to the Coconut Creek, Fla.-based nonprofit. “The catalog is our best performer for direct mail,” said Executive Director Angel Aloma. “It’s one of our most steady things.”
Holiday catalogs are successful, but they’re also changing and competitive. Catalog recipients are increasingly browsing on paper but buying online. “People now just go online for convenience,” said Christy Moore, senior director of donor engagement for Heifer International in Little Rock, Ark. She estimated that the catalog is responsible for about 50 percent of Heifer International’s overall revenue. “It’s an easy transaction. You don’t need stamps, and it can be done in a few minutes,” she said.
Jennifer Elwood, executive director of consumer marketing for the American Red Cross (ARC), said she also believes most of ARC’s catalog recipients go online to make a transaction. ARC, headquartered in Washington, D.C., does a match-back where it compares its list of people who received a print catalog with those who made a purchase via the online catalog. Many names appear on both.
Moore said between 56 and 58 percent of online catalog orders start with the print catalog. Heifer International’s analytics team also does a match-back, comparing catalog mailings with online customers. “We match that back with confidence and say people were mailed a catalog and went online,” she said. “We look at most of (the online sales) attributed to the paper catalog.”
This trend has been building steadily, according to Robbin Gehrke and Lois Ephraim of the Pasadena, Calif., fundraising firm Russ Reid. “The role of the print catalog is generally to capture interest,” said Gehrke, senior vice president and executive creative director. “People browse through the catalog, but anywhere between 40 and 50 percent, depending on the organization, will go online.”
Sometimes it’s even greater online versus print action, as in the case of the U.S. Fund for UNICEF. It offers Inspired Gifts, which are donations to UNICEF’s constituents of life-enhancing and lifesaving items, such as mosquito nets and water pumps, as well as a cards and gifts catalog featuring traditional items designed to be given to family and friends.
“We estimate that 75 percent of our online orders (for cards and gifts) can be traced back to a mail file,” said Wendy Miller, director of product marketing for UNICEF. The rate of donors who browse the Inspired Gifts print catalog and shop online is much lower, at 25 percent, according to Vice President of Direct and Interactive Marketing Helene Vallone.
Both Miller and Vallone said it’s hard to know why there’s such a discrepancy between the two programs. They think it has to do with the programs’ ages. “Since the greeting card program has been in existence for many years, many of our loyal customers expect to receive a catalog and then either mail in or phone in their orders,” said Miller. “The IG program is much newer (it began in 2007) so the behavior is different.” Vallone added, “We are also in a multichannel marketing age…it’s a practice that is expected and comfortable for a donor.”
Though some organizations like Heifer International have had holiday catalogs for decades, others, even established nonprofits, have just recently started using them. Save the Children in Westport, Conn., which has been in the United States since the Great Depression, has only been mailing a catalog for five years.
“It felt like we were one of the few organizations that didn’t have a catalog,” said Director of Retention Gail Arcamone. “We did a case study, met with the management team and thought we had an opportunity, potential we haven’t tapped before.”
Save the Children’s first year catalog sales were about $250,000, and have since grown more than 400 percent, according to Arcamone. “We’re projecting a nice increase” this year of 15 percent compared to 2011, she said.
Gehrke said catalogs are not appropriate for all nonprofits, such as those with an older donor audience. Donors aged 70-plus don’t respond as well to catalogs, she said, but baby boomers “who grew up with catalogs” and younger supporters are a target audience.
The best catalog offers are tangible, said Gehrke. That’s why gifts of food and livestock, along with copy telling the reader the impact of the gift on the recipient, work very well. For Oxfam America, Heifer International and World Vision the most popular gift is that aforementioned goat. Aloma and Arcamone both said goats are also very popular in their catalogs.
“The goat has been the icon of our gift catalog,” said Erika Syre, gift catalog national manager for World Vision, headquartered in Federal Way, Wash. “Not only is the price point attractive, but we’re able to tell the story. They’re able to provide milk and cheese, and it’s changing that family’s and community’s lives.”
Prices vary and are based on actual cost to the organization, said Kathy Skipper, director of public relations for Food for the Poor. In some cases, the listed price is an average because it costs more in some countries than in others to ship and distribute products, she said. “The gift amounts typically include the actual and management costs associated with purchasing and/or delivering an item or carrying out the service,” said Syre. “It reflects the total amount needed to make that specific activity happen, whether it’s shipping and distributing pharmaceuticals, or building a home for an orphan in Africa. It covers the cost of community involvement and training, if needed.”
Catalogs can be more than just fundraising tools. They’re an opportunity to get your organization’s mission out to the public and showcase its sometimes-disparate services. “We look at the catalog as a branding piece,” said Moore. “Even donors who don’t respond with a gift, we want them to be left with an impression of our overall model.”
Aloma said his organization takes a similar view of catalogs. Food for the Poor provides such diverse services as disaster relief, clean water access, orphan sponsorships and livestock to needy families. “We think (a catalog) is a beautiful way to show everything we do, every aspect of our ministry,” said Aloma.
Elwood said for ARC the catalog is not only a fundraising stream but also an education tool. “For us, it was about the strategy…to make the mission tangible and help people understand what we do year-round,” she said. “People may not know we provide measles vaccinations, emergency shelter or military comfort kits.”
Like Save the Children, ARC is a well entrenched nonprofit that only recently began shipping holiday catalogs. It had its first holiday campaign, of which the catalog mailing is the “cornerstone,” in 2009, said Elwood. But ARC has more on its mind than just harnessing the holiday spirit. Its supporters are different from those of many organizations. ARC’s donations spike during times of disaster and fall when things are quiet.
These episodic donors are willing to help, but are probably not as engaged with ARC’s mission as regular donors. Elwood sees the catalog as a way to turn those episodic donors into regular supporters. “It’s a way to share the mission with people who aren’t as familiar with it,” she said.
Catalog mailings generally target a mix of supporters and prospects. Many organizations see more success with and donations from people who already support the organization. Mailings to prospects are often a fraction of mailings to current donors, but not always. Syre said World Vision mails approximately 11 million catalogs to prospects, compared to 2 million to supporters. Gehrke said most of her clients use catalogs as more of a cultivation tool than an acquisition tool, but some see “gifts of over $100 as a first time gift, as opposed to $15 or $20 from (first time gifts via) direct mail.”
Catalogs can work to acquire new donors, but the medium is not traditional direct mail and should not be treated as such. Arcamone said Save the Children does not rent a list of people who donate to other nonprofits when targeting prospects with the catalog. The organization rents a list of people who buy from other catalogs.
Heifer International finds it difficult to determine the motivation of donors acquired via a catalog, who are similar to so-called premium buyers — people who donate to an organization mainly because of a gift offer. “Are they motivated by the gift aspect or by our mission?,” Moore asked rhetorically. “Usually it’s a mix of both, but it sets up a pattern where donors come to give a gift at the end of the year. We don’t want to leave people with the impression that Heifer International is a place to do your holiday shopping. We want people engaged all year.”
Aloma has found that the key to year-round engagement for his organization is two catalogs. Food for the Poor sends out a catalog in October for the holidays, and another all-occasions mailing in March to capitalize on Easter and Mother’s Day. “By sending (a catalog) in March, we hit a lot of occasions where people want to make a symbolic gift,” said Aloma. The all-occasions catalog also gets a bump around Christmastime, he said.
Most catalogs are mailed in October, and organizations start seeing the orders roll in around the first week of November. Sales are strong in November and December and often extend into January, with most of the revenue generated between Thanksgiving and Christmas. Catalog mailings are often accompanied by a multichannel campaign consisting of email blasts, social media messages and sometimes telemarketing.
Though Oxfam America has no print catalog and its online catalog, Oxfam America Unwrapped, is up all year, the Boston-based organization “does about 95 percent of online sales between November 1 and December 31,” according to Press Officer Josh Silva. Oxfam America does two major advertising pushes: one for the holidays, and another around Mother’s Day. “We don’t brand the entire (Oxfam America Unwrapped) program a holiday campaign,” he said. “We like to give people opportunities to give throughout the year.”
Social and mobile media
The World Wildlife Fund (WWF) in Washington, D.C., tries to engage its constituents where they want to be engaged, said Director of Online Marketing David Glass. The organization has had a print catalog and online gift center for the past six years, but in October 2010 it added a Facebook aspect. With the Facebook gift center, he said, donors can trumpet to their friends that they’d just symbolically adopted a polar bear.
“We at WWF love trying to connect with supporters where they (already) are,” he said. “We see the Facebook gift center as more of an entryway to the main gift center.”
Glass said that between 15 and 20 percent of WWF’s website traffic comes from people on their tablet computers or smartphones. Though he admitted that most of the mobile viewers are looking for information, as opposed to making a transaction, he said it’s important to be ready for customers interested in buying a gift from their phones. WWF’s catalog is optimized for mobile, and the organization is exploring the creation of a catalog app.
“These things are changing so rapidly. We want to make sure we offer donors and supporters as optimized (a mobile) experience as we can,” he said. “We would hate to be too behind the curve.” Heifer International has also optimized its catalog for mobile, and has its catalog listed within Catalog Spree, a mobile app. Catalog Spree and the similar CoffeeTable app (where users can find the World Vision catalog) are collections of catalogs that allow users to digitally browse gifts in a form similar to a paper catalog, complete with page flipping, instead of scrolling through gift selections on an organization’s website. Moore cited mobile traffic accounting for about 6 percent of total online catalog traffic.
Silva said this holiday season will be the first that Oxfam America Unwrapped has optimized for mobile devices. Even without the mobile optimization, Oxfam has seen explosive growth in mobile traffic: 393 percent more in 2011 than in 2010. “Overall in the grand scheme (mobile access) is a pretty small percentage, but it’s been growing.”
Gehrke and Russ Reid Vice President and Creative Director Lois Ephraim said they believe mobile is not yet a high priority or a large percentage of catalog sales for multiple reasons. One-touch checkout is not yet in widespread use for mobile payments, meaning customers must type payment information onto their devices’ screens, not always an easy task for smartphone users.
Another reason is that “unlike commercial catalogs and commercial e-commerce, in the nonprofit category the photo doesn’t tell the whole story,” said Gehrke. “You need at least a paragraph of copy.” World Vision’s holiday catalog has one or two products per page with about a paragraph each describing the impact of the gift, as opposed to a dozen or more items for many commercial catalogs. Text-heavy catalogs can often be difficult to read on a three-inch screen for many users.
Donors connect with storytelling, said Glass. His organization added to catalog copy “notes from the field,” what WWF’s scientists are doing and why they’re doing it. ARC has quotes from donors and “people who’ve been touched by ARC and wanted to share,” according to Elwood. “If you’re looking at a page that promotes chickens, there’s content on chickens and what they provide, and a story of a family that received chickens and how that impacted their lives,” said Heifer International’s Moore.
The UNICEF Inspired Gifts catalog has an Inspired Gift in Action story attached to each product. They describe in specific terms how the selected product is used, such as the distribution of water purification tablets to 50,000 families after flooding in the African country of Cameroon in 2010.
As with traditional direct mail, testing is crucial. Nonprofits with both a print and a web catalog have an advantage compared to organizations with only a mailing. “We use the Web as a testing ground,” said Aloma. “There’s no cost per space, and it’s cheaper to test on the Web. In a hard copy, space is at a premium.”
Food for the Poor this year added a $240 beehive to its online catalog. If enough people donate the bees during the Christmas and Easter campaigns, Aloma will consider adding the hive to the print catalog next year. “Every year the marketing people go through and see what did the best and what did the worst, and try to replace the worst,” he said. Most important, holiday catalogs offer a way for nonprofits to remain visible and viable in a season of massive retail advertising campaigns. They offer organizations’ donors a relief from the rampant consumerism on display between Thanksgiving and Christmas. “We have become such a consumer society that most of us have everything we need and a tremendous amount of what we want,” said Aloma. “It makes a great difference to give someone the chance of the basic necessities of life.” NPT