Spy Vs. Spy: Large, Small Mailers Watching Each Other

February 2, 2015       Richard H. Levey      

Legendary adman David Ogilvy three decades ago called direct mail “my first love and secret weapon.” The secret’s been out for some time, but as one might predict, large nonprofit mailers have tricks to share with smaller fundraisers. The big surprise is that smaller nonprofits use tactics larger fundraisers might overlook.

Take freemiums — or rather, the lack of them — as an example. Most direct mail fundraisers believe that donors brought in with gifts require additional gifts to re-up. Many smaller mailers don’t use gifts, if only because they can’t bear the additional expense. Larger mailers should test weaning their prospects and donors — and themselves — off them, according to some veteran direct mailers.

Veterans service organization AMVETS mailed gift-based efforts for “decades,” according to Chief Development Officer J. Michael Fisher. “We are getting a lot of feedback from younger donors — 60 years old and younger — who are saying ‘I have a smartphone now. What do I need a pocket calendar for?’,” Fisher said, adding that most just wanted to know their donations were being properly used.

National news pushed AMVETS, based in Lanham, Md., into a premium-free mailing during mid-2014. AMVETS and The Heritage Company, a fundraising firm, had designed a solicitation aimed at existing donors, but hadn’t selected a gift. “Our intention was to order a premium and figure out how to work it in,” Fisher said. That was before the federal Veterans Health Administration came under fire for providing inadequate care. When Secretary of Veterans Affairs Eric Shinseki resigned, Fisher knew he couldn’t delay the mailing to purchase premiums.

“It was a time-sensitive topic,” Fisher said. “If we waited a week or two, by the time it reached everybody it wouldn’t have been nearly as timely.”

The Heritage Company and AMVETS quickly reconfigured the mail piece, removing all mentions of premiums and drafting a new letter titled “Fix the VA.” Out it went to a test panel of 5,000 previous donors. And back came the donations, at a 6.5 percent rate — two full percentage points more than what premium-focused offers sent to AMVETs’ house file typically generated.

Even better, eliminating the premium reduced the cost of the mailing by 30 percent, Fisher estimated.

Larger mailers, which are more likely to use premium-based solicitations, should test gift-free packages, Fisher suggested. Furthermore, since organizations can anticipate a handful of news or event categories that will resonate with their donors, they should have pre-designed packages that address these concerns and can be put into the mail quickly.

Part of what made the new package work was the “Fix the VA” letter’s tight focus. “This is one of the hiccups [characteristic of] smaller organizations,” said Marilyn Michie Zornik, president of The Heritage Company in Little Rock, Ark. “They want to write long paragraphs with a lot of different topics, and they throw all of the different problems and struggles into one paragraph.”

Some smaller nonprofits already avoid long notes. “Nobody has a lot of time,” said Heather Greene, CFRE, and senior development officer at The Dian Fossey Gorilla Fund International in Atlanta, Ga. “I’m surprised I still get long letters and multiple-page packages.”

But Greene knows that short is not a synonym for uninformative. “Our letters update donors about what is going on in the field, rather than talk about the needs we have, because that’s what keeps [donors] interested,” she said. “At the same time, we make the ask.”

Greene said her organization’s niche, nature, opens possibilities that aren’t as readily available to larger mailers which have broader-based missions. The Fossey Fund’s contributors are very loyal, and Greene is more comfortable making the donor list available for exchange than other nonprofits might be. The names she gets in return help keep her acquisition costs down.

Of course, Greene is equally — if not more so — preoccupied with increasing response rates. Large and small mailers alike, she said, should consider the herd-like impulse to mail a post-Thanksgiving solicitation campaign.

“Mailers need to ask what the real ROI [return on investment] of mailing that final letter of the year is,” she said. “We mail heavily at the end of the year because it is the giving season, but is that the smart thing to do?”

Most organizations have anniversaries or events in their histories, Greene said. Fundraisers can tether a fundraising appeal to such events, giving the solicitations additional relevance.

Mailers have other ways of tugging on heart and purse strings. At the Appalachian Trail Conservancy in Harpers Ferry, W.V., Royce Gibson, director of membership and development, personalizes efforts whenever possible.

The personalized mailings feed into the organization’s new strategic plan, which calls for boosting membership from the current 42,000 to 60,000. Gibson’s strategy focuses on more than creative tweaks. His examination of postage costs led to adjustments in the organization’s retention efforts.

“Instead of mailing our renewals once a month, we stagger them out every six weeks,” Gibson said. “We are mailing at a nonprofit [postage] rate, and sometimes it takes 10 days from the time we mail to get into mailboxes.”

Once members receive a renewal notice, they tend to respond quickly, Gibson added. “If we were doing a standard monthly [schedule], we wouldn’t give people a chance to respond to a mailing before they got a second one. By pushing [the frequency] out by two weeks, we are able to significantly cut down on the number of pieces we mail and keep our response rate.”

Small organizations have other ways of realizing cost savings, such as taking advantages of economies of scale by partnering with other mailers. Martina White, director of member acquisition and lapsed reinstatement at The Nature Conservancy in Arlington, Va., suggested that small, regional organizations band together and offer their lists to larger mailers.

“Take public broadcasting,” White said. “Affiliate stations will often co-op together for list rental purposes. The national list [they receive in exchange from a national organization] would be broken out by region within the co-op.”

Banding together with regional organizations opens up other opportunities. White has determined which of her supporters provide $100+ donations. When other regional organizations in a co-op do similar analysis, mailers can offer enough high-value donors to ask for high-value names from national nonprofits.

The high-value donors in her house file don’t need expensive mail packages, she said. Their contribution level shows they’re already committed. As long as they receive an informative letter, they’re satisfied.

Finally, there’s a time-honored bit of wisdom both large and small mailers should heed. “One of the old axioms of direct marketing is that one of the best things you can do is find good ideas and rip them off,” said Larry May, senior vice president for strategic development at Infogroup Nonprofit Solutions in Greenwich, Conn. “Strategic ideas that larger nonprofits follow in their fundraising can often be imitated by smaller organizations on a smaller scale.”

In some cases, borrowing approaches might require more than a little modification. Larger nonprofits could have a fair amount of brand equity, a benefit that smaller organizations can’t easily claim.

The trick might be to vie for a donor’s attention based not on the organization’s name, but rather its mission. “There are a relatively small number of types of charities people are predisposed to support,” May said. Those major categories include services for children, fighting disease, ending poverty, international relief, helping veterans, emergency relief, and political issues and candidates, he added.

“If a [smaller] organization can successfully define itself as falling into one of these categories in a way the public can understand, often the brand itself can be somewhat secondary” to making sure the prospective donor has a clear understanding of what he or she is being asked to support, mission-wise, May said.

“The smartest thing [smaller nonprofits] can do would be to contribute $25 to four or five organizations in their category, every year, and track the fundraising efforts they receive from those organizations, with the assumption that [they’re receiving] the most successful approaches,” he suggested.

Smaller organizations also have opportunities larger nonprofits can mimic. In smaller organizations, department staffs have more latitude to be entrepreneurial. Large organizations can bring some of that feel in-house by providing independence and rewarding entrepreneurship, within basic guidelines, to different departments.

Nonprofits large and small need to keep mailing, even if acquisition mailings are break-even (or worse) propositions, said The Heritage Company’s Michie Zornik. New donors often make back acquisition costs with subsequent efforts. “You can imagine a board sitting around saying ‘we are not making any money on acquisitions, so we are not going to do acquisitions,’” she said. “But donor attrition rates are 20 or 25 percent each year. When organizations don’t do donor acquisition, they lose.”

Finally, there’s the personal touch, which might be easier for a smaller organization to pull off. A handwritten thank-you note combined with a live postage stamp will usually get an additional something back from the donor. “A lot of letters, from small and large organizations, are a little bit too ‘computer’ looking,” said Michie Zornik. “Once you start producing thank yous en masse, you start losing that loving feeling.” NPT