The Return of Marketing to Fundraising Engaging Alumni with Premiums and Other Tested Strategies

Transcription

1 The Return of Marketing to Fundraising Engaging Alumni with Premiums and Other Tested Strategies David Hazeltine CASE Senior Annual Giving Professionals Conference

2 Common practices and issues within development and alumni association offices, include

3 Average or below-average alumni participation rates and donor retention Poor response rates and low net dollars raised (but high average gifts) Concerns with cultivating young alumni Common, plain-text, #10 mail packages Dean-signed, school-segmented letters Lack of incentives to entice alumni to give Staff frustration with some/all of the above

4 We soon came to realize, after careful inspection of numerous direct mail appeal packages, that there was one key ingredient missing across the board.

5 Our Mission: Put The Marketing Back Into Direct Mail Fundraising

6 What Is Fundraising? The organized activity or an instance of soliciting money or pledges, as for charitable organizations or political campaigns.

7 MARKETING The New AMA Definition (2004) (and where the University of Phoenix and most for-profit organizations are today): Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing relationships in ways that benefit the organization and its stakeholders.

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9 Customers buy for their reasons, not yours. Orvel Ray Wilson

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11 You can say the right thing about a product and nobody will listen. You've got to say it in a way that people will feel it in their gut. Because if they don't feel it, nothing will happen. - William Bernbach

12 What Is Direct Marketing? The practice of delivering promotional messages directly to potential customers on an individual basis, as opposed to through a mass medium.

13 The secret of all effective originality in advertising is not the creation of new and tricky words and pictures, but one of putting familiar words and pictures into new relationships. Leo Burnett

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15 Fundraising and Marketing must co-exist in direct mail appeals.

16 Opportunities are often missed because we are broadcasting when we should be listening. Unknown

17 A Challenge for You: Give your appeal letters (and any alumni comunications pieces) the WEs and OURs vs. YOU and YOURs test

18 Take one of your recent fundraising appeal letters and count the number of times the words WE or OUR are used. Repeat this for the words YOU and YOUR.

19 If the WEs and OURs exceed the YOUs and YOURs it s truly a fundraising solicitation! Marketing must be about you!

20 So How can we incorporate true marketing and direct marketing into our direct mail fundraising?

21 First By Engaging Our Alumni En gaging (adj): Charming or pleasing in a way that attracts and holds the attention.

22 Through Exciting outer envelopes, in a-typical sizes, shapes and colors, with a bulky feel, and with strong, creative teaser copy Multi-part mail campaigns, to reinforce the message Online giving options, providing choices and encouraging them to explore our Annual Fund s web site.

23 Second By delivering information, products and services that is/are Relevant to our Alumni. Rel e vant (adj): Having a bearing on or connection with the subject at issue.

24 Through Information relative to their school, class, era, interests, giving preferences, etc. Front-end premiums (Freemiums) that have perceived value, and engage them and bring them back to campus Informative letters and other inserts that speak to their past experiences, and how they can mold the school s future Charts & graphs to explain how their donations are being spent.

25 Third By giving alumni a sense of ownership. Ow ner ship (n): The fact or condition of being an owner of something.

26 Through Conveying a perceived value in helping the institution to grow the one that they trusted for their higher education. Communications with a bit of a warm & fuzzy feeling, that push their pride buttons. Show-me-that-you-know-me messages, that resonate with alumni young or old A feeling of ownership creates alumni evangelists

27 Lastly By Reinforcing our messages, in an effort to ultimately get them to Buy.

28 Through Reminder/Follow-up mailings Multi-part, branded theme campaigns, i.e Annual Fund, Challenge, etc. Similar online content, i.e Visit to learn more.

29 A Message to Higher Education Development and Alumni Association Professionals: Start viewing your direct mail through a different lens!

30 The Common Direct Mail Piece:

31 The Better Way:

32 The 3-Second Rule DMA studies show that 3 seconds is all your alumni have to decide whether or not to open your mail. Mail that gets opened features Bright, attractive colors Bold graphics and branding Windows that give a sneak peek of what s inside Relevant Messages

33 Why Premium-Based Fundraising Works People have a natural inclination to reciprocate when they receive something they believe has value; People are more inclined to donate or join an organization to which they have an affinity; Premiums with a perceived value help cement the relationship between donors and the organization asking for donations (they sent me something!).

34 Why Premium-Based Fundraising Works (cont d) Premium-based appeals are uniquely capable of reconnecting Alumni to their school. A picture, we are told, is worth a thousand words. Items such as greeting cards, calendars, address labels, etc., and can carry multiple visual representations of what an organization stands for, will present your school in a way that words alone cannot.

35 Why Premium Based Fundraising Works (cont d) Think of how difficult it is for the alumni recipient to throw away or return something that is useful, relevant and perhaps even personalized; Combine that with the fact that since it is from their alma mater, it connects them a difficult combination for an alum to refuse.

36 Actual note written on the reply device of an Ohio University return-address label package: Thank you for finally sending me something of value!

37 CASE STUDY: Southern Methodist University A Three-Year Comparison

38 Program Comparison Report Straight Appeal Address Label Address Label Quantity Mailed 40,300 20,685 24,581 # of Gifts % Response 0.2% 4.4% 5.0% Average Gift $ $73.04 $76.28 Total Revenue $10,170 $66,976 $94,055 Investment ($17,732) ($27,304) ($34,145) Net Profit ($7,562) $39,672 $59,910

39 SMU Response Results by Mailing March 10, 2004 # Pc. Mailed # Res. % Res. Avg. Gift *Cost Revenue Net Rev. Cost per $ Raised Label mailing % $49.73 $19,651 $21,730 $2,079 $0.90 1st Reminder % $74.65 $6,682 $21,276 $14,594 $0.31 2nd Reminder % $ $6,588 $23,970 $17,382 $0.27 Totals % $73.04 $32,920 $66,976 $34,055 $0.49

40 A - 10, 12, 15 B - 25, 50, 100 Response by Segment Source Quantity Percent Avg Lot Code* Mailed Returns Response Revenue Gift Lapsed 1 Year A 1, % $ 22,188 $ Lapsed 1 Year B 1, % $ 18,232 $ Lapsed 2 Years A % $ 2,969 $ Lapsed 2 Years B % $ 2,786 $ Lapsed 3 Years A % $ 6,116 $ Lapsed 3 Years B % $ 4,759 $ Non-Donors A 7, % $ 3,171 $ Non-Donors B 7, % $ 6,755 $ GRAND TOTAL 20, % $ 66,976 $ 73.04

41 SMU Response Results by Mailing January 27, 2005 # Pc. Mailed # Res. % Res. Avg. Gift Cost Postage Revenue Net Rev. Cost per $ Raised Label mailing % $39.48 $13,269 $3,440 $19,028 $2,319 $0.70 1st Reminder % $ $6,073 $3,401 $50,169 $40,695 $0.12 2nd Reminder % $83.70 $5,745 $3,217 $24,858 $15,895 $0.23 Totals % $76.28 $25,087 $10,058 $94,055 $58,910 $0.27

42 Percentage Response Total Revenue 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 5.0% 4.4% 0.2% $100,000 $80,000 $60,000 $40,000 $20,000 $0 $94,055 $66,976 $10,

43 An Online-Giving Direct Mail Enhancement Program

44 2ways2give.com features Gives alumni a choice on how to respond A custom 3-page web site Mailing list is uploaded - Alumni are assigned a unique online code Can be independent or tied into existing online commerce system Easy, fast and secure Funds collected sooner/no BRM charges

45 Remember 3 Proven DM Principles: Get their attention - fast Offer something of genuine value Make it easy to say YES.

46 A Few Words About the Internet: Quickly becoming the dominant form of mass media in the U.S. Now preferred over TV In over 60% of U.S. households People with broadband average 17.3 hours per week online People are increasingly using the internet while watching TV 53% of users trust the internet

47 So, With All That Internet Usage Why wouldn t you want to offer your alumni not only a 2nd option for giving, but one that is: Driven by your appeal mailing Pre-populated = Convenient Fast and Easy, without the intimidation of finding you on the main site, and figuring it out.

48 CASE STUDY: Ohio University A Bicentennial Campaign

49 CASE STUDY: Ohio University First time ever mailing to entire alumni file (140,000 +) Utilized online giving direct mail enhancement program

50 CASE STUDY: Ohio University 3-part mail campaign Mailing #1: Lapel Pin Freemium to Current and 1-year Lapsed Return-address Labels/Stickers Freemium to 2-, 3- and 4-year Lapsed and Non-donors

51 CASE STUDY: Ohio University 3-part mail campaign Mailing #2 - First Reminder: 45 days after initial appeal Simple, 2-page letter/reply Initial mail respondents suppressed

52 CASE STUDY: Ohio University 3-part mail campaign Mailing #3 - Second Reminder: 90 days after initial appeal Simple, 2-page letter/reply Full-file Thank-You, mailed to entire mailing #1 file

53 Ohio U. Combined Online Results Decade Dollars # Donations Average Gift % Total Dollars % Total Gifts , $ % 22.1% , $ % 17.5% , $ % 21.2% , $ % 22.9% , $ % 10.6% < , $ % 5.7% Total $ 33, $ % 100.0% ========== ================================================

54 CASE STUDY: Ohio University Online Giving Highlights: Overall two tenths of one percent (0.2%) response (high in comparison to other online programs) 32% higher average gift than the mail responses overall. In some segments the average gift more than doubled. Accounted for over 10% of the total revenue. Over 50% of total revenue from 70s and 80s decades. 349 new/updated addresses to the file.

55 CASE STUDY: Ohio University Bicentennial Campaign Overall Highlights (Mail and Online): Total Revenue over $323,000 Total Net Revenue over $149,000 Total percentage of response 3.55% Total # of respondents over 5,050 Total NEW Donors 1,471 Total reactivated donors 1,792

56 Other Initiatives for Higher Education Fundraising: Variable-Data Digital, 1:1 Campaigns Parents Fund Programs Athletics Development Programs Ethnic Messaging Tests Male vs. Female Message Tests Auto-Call Pr Phone Call Tests

57 Parting Thoughts Think outside-the-box for your alumni appeals Practice thinking about cost per response, rather than cost per thousand Attend marketing conferences, not just CASE and other higher ed. conferences (DMA, PODi, DMFA, Non-Profit Day in NY, etc.) Maximize your Outsourcing the right person for the right job. Do what you were hired for and what you do best: the bigger picture of fundraising, and

58 Consider outsourcing your direct mail fundraising program to a strategic partner and not just a mail vendor to work closely with you, to help you achieve your goals through sound, creative strategy, data segmentation, production management and comprehensive back-end analysis. And you just may end up with Better Net Results!

59 THANK YOU! David Hazeltine President & CEO , x22