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DIRECT MAIL :

Lumpy Packaging Power

5 ways to maximize response

Segmenting your donor files

1. Lumpy Packaging Power
Although it sounds like some failed attempt by a grandma to send un-mixed mashed potatoes to a distant relative, lumpy mail is a valuable tool for nonprofit fundraisers.

At least that’s what Jon Goldman, the self-monikered Lumpy Mail Man, asserts in a resource book on lumpy mail. Goldman provided excerpts of the book in the Direct Marketing Association of Washington’s workbook from a recent conference.

Results he included are from large mailers with extensive testing programs, according to Goldman. One case shows that a direct marketer increased response rate by 135 percent and experienced a jump in net income thanks to a pocket planner mailing.

The more expensive pocket planner mailing had a 10.43 percent response compared with 4.44 percent from the control package, according to Goldman. The pocket planner also had a higher average gift of $11.76 to the control’s $11.20.

In another case, an organization’s low-cost control used for several years was declining, according to Goldman. Seeking alternatives they mailed a personal photo album as a house appeal, before Christmas. It led to a 130 percent response jump, and 379 percent net income up tick, despite a higher cost per dollar raised, according to Goldman.

The photo album had a response rate of 10.77 percent with an average gift of $11.90.

2. 5 ways to maximize response

Direct mail fundraising remains vital to nonprofits, and a successful campaign not only increases existing donor dollars but also unlocks doors to new dollars.

Brian J. Renda, president and CEO of Brickmill Marketing Services, offers five tips that will improve direct mail fundraising and increase the bottom line.

Integrate existing channels. Often the investment has already been made, and you can use it for a campaign. See what already exists on your Web site; direct a mail incentive around a planned offering; include positive newspaper clippings in your direct mail.
Empower your donors by giving them options relating to your premiums. "Young senior" or "young baby boomer" audiences are very interested in mission as well as how you spend their contributions.
Utilize the power of referral marketing. Provide donors with an easy, convenient way to pass along their feelings about your organization to others.
Know how much to mail. Mailing with a select strategy rather than mailing blind can pay big dividends. One ingredient for this is understanding statistical information and knowing how to leverage previous select data.
Spend the extra effort on package design and branding. You have only seconds to stand out among the clutter of mail that donors receive each day. Provide a reason for them to pause.

3. Segmenting your donor files

With list maintenance such an important part of direct mail campaigns, it is necessary to be aware of various aspects of the recording and storing of lists.

In his book Revolution In The Mailbox: Your Guide to Successful Direct Mail Fundraising, Mal Warwick stressed the importance of segmentation, deciding whom to include and whom to exclude from an appeal. Segmentation is an effective way to boost fundraising results by treating each segment in a manner consistent with its behavior. Warwick used four principal evaluation criteria in order to define segments.

The four segmenting criteria are:

Recency. Based on the last date on which a donor has contributed to an organization, and usually measured in chunks: donors whose last gift was received in the last six months forming one segment, those whose last gift was contributed from seven to 12 months ago forming another.
Frequency. The number of gifts received from a donor during a particular period of time. Measuring frequency usually means distinguishing between one-time, two-time, three-time and four-or-more-time donors.
Monetary amount. Often defined as the highest previous contribution during the donor's entire history (HPC) or as the last or most recent contribution (MRC). Some nonprofits choose to measure donors' cumulative giving
Source or channel. The means by which the donor's first gift has come to the organization. This can be significant because donors accustomed to one channel may be unresponsive to appeals via others.