By Tom Pope

Finding needles in a haystack of names

You might think a customer list from a diabetic-oriented product would work well in fundraising for the Juvenile Diabetes Research Foundation in New York City. But not all diabetic lists hit the mark.

"The general topic isn't enough of a qualifier to make a slam dunk for success," said Shawn McKenna, director, individual gift programs for the nonprofit. "Some diabetic product selects work better than the general audience, but even that top percent of the selects might not get you over a magic threshold."

"Selects" is the prime word in targeting donors. Using the standards of finding names that have donated recently, or frequently, or and of a certain age is basic. But what can fundraisers tweak to get those names more productive?

"You're still facing those key factors in looking for selects," he said. "But when you try to find a closer affinity you might also discover that the audience does not have the money to spend."

For McKenna's 2.5 million piece acquisition program, the simple approach looks at donor lists for recency, whether the list is from a health charity, whether the charity has a children's orientation and then whether it is premium focused.

"I don't think a secondary or tertiary source can ever beat recency as a center of the bull's eye," he said. "We're dealing with behavior that requires people to open up mail and sign a check -- it's a specific set of behaviors that we're trying to get them to repeat."

McKenna's first priority looks at zero to six months with $10-plus names. "Generally I don't need to know whether the zero to three months are better than the four to six, although that fact might be nice," he said.

McKenna's role is different from when he worked with the Disabled American Veterans (DAV) as list buyer from 1992 to 1997. "I had carte blanche with an almost unlimited budget for list testing," he said. "But here the acquisition amount is so small, I can get by with doing zero to 12 months."

However, he does find certain fine tuning can be important beyond the basics. The topic of health might not work for each health organization because donors are concerned about specific issues. Yet crossovers with similar problems like blindness could link sight organizations with those focusing on diabetes.

Even brokers agree that recency, frequency and age are still the key items. Dodee Black, president and COO for Atlantic List Company Inc., a full service list broker in Arlington, Va., believes little is new. Yet, she explained that multi-buyer selects don't work as well as in the past. Some enhancements with lifestyle, age and gender are being examined by clients.

"Some clients look for whether people have pets in a household," she said, "and others find gardening cultivation helpful, especially for conservancy and preservation clients."

The lifestyle factor has always been a good way to look for direct response, according to Black. For example, lifestyle selects of owners of SUVs can be used both ways. In one, these selects can be eliminated by some organizations opposed to higher taxes. Or, they could be used as examples of disposable income.

"However, the information is harder to get," she said. "Information on cars used to be available through license plates although some states have stopped that."

Fundraisers interested in customizing several niches might want a variety of criteria. But such lists are not readily available and the fundraiser has to dig into specialized models.

Major consumer lists that have been effective are some larger publications like U.S. News & World Report, Fortune magazine, and National Geographic. "Sometimes these lists cover such a wide audience it wouldn't be statistically correct to use them without a refining process," she said.

Who would think horses and religion have a direct response common thread? Cal Farley's Boys Ranch in Amarillo, Texas, looks for age, gender and Western style populations, such as those who read horse magazines.

Subsets of names fit into the mission. One subset is the agriculturally concerned since the nonprofit runs a ranch. Cal Farley's is a residential care facility for troubled children through age 19. Because the organization raises meats and milk in a horticultural program, beef and pork eaters are also sub-sets of lists.

Cal Farley's maintains a Christmas time mailing of 9 million with another 1 million during the rest of the year. "We see response rates still lacking compared to some large organizations like St. Jude's," said Bobby Dean, vice president for development. "We would like a $17 gift figure and usually draw a response rate of 1.5 percent."

Dean said that he looks for consumer lists that match with Better Homes and Gardens' population. "We want the middle-age, female buyer," he said. "Subscribers to the younger age lists like Eddie Bauer don't work for us because their disposable income goes to other products," he said.

Looking at disposable income doesn't necessarily mean seeking Mercedes owners. "A segment of luxury car owners from compiled lists worked for a while, but then stopped," he said.

As a contrast, Dean also finds lists that heavily focus on men can work well. What is the connection between the Better Homes person with Forbes? "The overlap may be upper income even though we haven't run overlays," he said.

Not every connection works. "Certain religious names we thought would work for us didn't pan out," he said. "We tried some conservative political lists since we are a religious, conservative organization, but those didn't work well, and that surprised us."

Finding connections has led Dean to use affinity lists with cattle, ranching, and riding that include penning, a sport with cows in an arena like the rodeo.

Horses might help some nonprofits, but finding the cats amongst the dogs gives the American Society for the Prevention of Cruelty to Animals (ASPCA), a leap in New York City.

The ASPCA doubled the gross revenue per thousand from $400 to $795 with active online donations when fundraising used specific information focusing on either cats or dogs. The ASPCA developed specialized details about 20,000 of the 60,000 people in the database. The response rate also doubled from 2.25 to 5.52 percent with cat-or-dog-specific details.

"We recently discovered that when we gather pet information, we can tailor the message depending on the type of pet the donor owns," said Todd Hendricks, senior director of direct response. "This first round of testing worked so well that we've adopted the strategy for testing off-line."

The organization does 12 to 14 million pieces of acquisition mailing a year and recruits donors from 150 different mailing lists. The desire to overlay pet details is clearly the next step to raise the acquisition rate from 1.4 percent.

The ASPCA has used complied files for around 15 percent of its list universe, especially looking for known pet owners. The bulk of the lists is centered on pet publications and newsletters. A small percent arises from environmental or other advocacy files.

"The animal lists are the most effective," he said. "We have tried income selects, but those are not a strong indicator."

Fundraising has changed with online capabilities. "Organizations always felt that gathering information was crucial," he said. "Now, especially through the Internet, registering and gathering information is easier so that sending messages off-line becomes more efficient."

However, not everyone appreciates the value of selects. "Frankly selects have a limited ability for nonprofits," said Diana Estremera, vice president of May Development Services (MDS)/ Direct Media, in Greenwich Conn. "The key is dollar and frequency, so the tightest select you can get on a donor file relies on how soon in the hotline the name has given before."

Yet, some surprises have emerged. Traditional thinking has said that the more money a list yields up-front, the better lifetime value will follow. For example, the Forbes magazine type of list traditionally brings in a higher than usual gift at $112 compared to the average $32. Organizations recognize the response rate is lower than usual at below 1 percent, so the goal puts a mix of those lists with others. The end result should be to break even in a shorter time.

"But recently we discovered the affinity of a particular donor to give to another organization continues to yield results for a second and third time faster than the Forbes results," she said.

One strategy suggests modeling financial information to place names from a large database of credit agencies and then apply overlays to that list. Estremera warned that the results really depend on the specific mission of the nonprofit.

To effectively use selects, organizations have to be large mailers with a reputation, according to Estremera. The organization must have gone through many lists so other enhancements are required.

Contrary to much thought, the American Cancer Society (ACS) in Atlanta has found males giving larger dollar amounts than their female counterparts. The ACS runs a 25 million- piece-a-year acquisition mail program that breaks even and draws rates between 1.5 to 2.5 percent.

"Once they are engaged they write larger checks," said Karen Gleason, director of direct marketing. "Other fundraisers should not just automatically write them off."

Historically, the ACS looks for some gender selects with package strategies for high dollar lists. The select females are from a targeted prevention cancer focus because usually women are caretakers of the family.

ACS uses the financial publications to reach the male with the larger check. "Those people have higher household incomes," she said.

Meanwhile, WNET-13, a public broadcasting station in New York City, uses selects from those who have lapsed in upgrades. "We model them against names from a cooperative database and mail them an acquisition package," said Edward Mills, director of membership for the station.

The station conducts five major appeals with four follow-ups for renewal opportunities. Fundraising decides on priorities based on the history of the donors.

"We have 300,000 active members, but only 90,000 who have given 10 or more times," he said. "By taking the deep lapsed names and putting them into acquisition even though the process goes through the cooperative database, we lower costs because we're not relying on rented lists or cross-selling."

WNET doesn't do well with consumer publication lists like Consumer Reports, according to Lisa Lynch, assistant director of basic membership. "We've been testing a lot, but have not found one that works like gangbusters," she said. "Of the top 25 successful lists, half are health organizations like the U.S. Olympic Committee."

Yet she explained that no common theme exists as the lists come from different types of health concerns.

One experiment in progress is merging names from sister station, WLIW 21 Public Television. WNET now manages the sister station and attempts to cross sell to the other station, believing the donors have the propensity to give to more than one organization.

Age strikes as the key factor for the Southern Poverty Law Center, in Montgomery, Ala. "The best ages are 50 -plus as a general rule," said Valerie A. Beatty, membership director. "The younger demographics of 30 to 45 are tougher as a group to be pursued."

Oddly enough, Beatty sees the younger audience from liberal colleges can rank high with awareness, but translating the awareness into direct mail response fails to follow. "We look for three critical areas -- gender, age, and to a limited degree, geographic," she said.

Beatty looks at consumer lists for the date of birth that corresponds with known supporters. "We haven't had a tremendous amount of luck with consumer lists because some have such broad audiences," she said. "Besides, selects can be pretty expensive."

However, trying to find the right names continues to help fundraisers. "The process has allowed me to make some marginal lists perform better," she said. "We hope to find a long-term donor commitment."

Tom Pope, a New York City-based journalist writes on management issues.

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