In a previous post here, I discussed a few things in our direct mail world that have changed very significantly since I founded LDMI in 1987. Now I want to address two dimensions of the profession we share that look pretty much the same in 2017 as they did in 1987. And I suspect you’ll agree with me about the importance of these hardy perennials. When I think about what’s the SAME in direct mail today as it was when I founded LDMI in 1987, I think about two things. 1. What makes good direct mail copy? And my answer is pretty much the same as it would have been in 1987: Your copy needs to talk far more about “you” (the donor) — or one of the variants your, yours, you’re — than about “I” and “we.” Look at some of the direct mail copy you’ve produced, or a writer has produced recently for your nonprofit, and give yourself a report card. Look at the first paragraph of the letter. Does “you” or one of its variants appear in that first paragraph? If the answer is, “YES, in fact it’s the very first word in the letter after the salutation,” give yourself an “A+.” Congratulations! If the answer is, “YES, it’s not the first word but it’s in the first sentence,” well done. Give yourself a grade of “B.” If you answer, “YES, it’s not the first word, and it’s not in the first sentence, but it’s at least in the first paragraph,” well, okay, it’s nothing to write home to your Mama about, but you pass. Give yourself a grade of “C.” But if “you” (or “your” or “yours” or “you’re” . . . or even “y’all”) is nowhere to be found in the first paragraph of your letter, you FLUNK! Put an big fat “F” on your direct mail creative report card. 2. Direct mail donors are OLD. (It’s OK for me to say this, because I’m old.) You may not believe this, but if so, well, you’re wrong. Sorry. Donors ARE old. The median age on many very productive donor lists is 65, 70 even higher. Though you may feel compelled to admit that’s a fact, you may just HATE the fact, and you want to change it. You want to figure out how to move your donors’ median age down to, say, 55, or better yet, 45. And if that’s what you’re thinking, I have some hard-won experience working with fundraising managers just like you who have felt this urge and asked me to help them accomplish this seemingly-simple task of moving the slider on their donor lists’ median age down a decade or so. Here’s some advice based on that experience: — Be prepared to spend a lot of money. Mailing to lists of median age 55 (let alone 45) will be very hard to find and very expensive. Your cost of acquisition of a new donor will head skyward like a Bryce Harper home run heading for the upper deck. (And your Board will lament that fact, count on it.) — You will fail. Count on this, too. Any nonprofit that’s got a big enough budget to build a median age 55 donor list (and by now you know the drill — let alone 45!) doesn’t need direct mail. They can just set fire to piles of money on their Board room conference table. And I’m quite sure your Board will grievously lament this conflagration, and will wonder why you lit the match. You may be asking how I can be so sure of this, and I’ll tell you. The answer is confoundingly simple, once you decide to look at the issue unemotionally, with a cold eye for the facts. Mailing lists of donors are old, because the population of people with disposable income sufficient to allow them the luxury of making free-will donations to good causes they approve of is demographically centered among old people. That is, donors are old because it’s old people who have the money. They’re people who are blessed to be retired, living off their 401(K)s or other investments. Generally speaking, if the stock market is healthy, that’s when you want to be talking to them, because that’s when they’ll be receptive to you. And a lot more of them are going to be 65, 70, 75 or older, than 55, 45 or younger. Fact of life. If you’d like to talk about this admittedly somewhat depressing fact — or about any of the other 1987 vs. 2017 comparisons I’ve touched on — please give me or Jim Lawrence a call, or drop us an email. Thanks for reading.
You remember 1987: the year of “Black Monday,” when the stock market lost over 22% of its value in a few hours ... Prozac went on sale in the U.S. ... we all became aware of televangelists Jim and Tammy Faye Baker ... Robert Bork was Borked by a cabal of Senatorial midgets led by Ted Kennedy and Joe Biden ... and Lawrence Direct Marketing, Inc. was born. Every cloud has a silver lining, right? In this brief reflection on LDMI’s 30th Anniversary, I want to call your attention to a few things that have changed in the world of direct mail since 1987 — and to a couple of things that have not changed at all. First, let me assure you, though, that if I tend to focus on the creative dimension of direct mail — copy, mostly — that’s not to say that design and art, lists, competitively-priced production, testing strategies and analysis of test results aren’t important. They are as important today as they were in 1987. And though my focus here, and my preoccupation professionally, is on fundraising for nonprofits, that’s not to say the lessons to be drawn from these 30 years of direct mail don’t apply to commercial mailers. Almost all of them do, and you know what? LDMI has quietly had a lot of success over the last three decades creating mailings for corporate marketers by following the same rules we’ve learned in the nonprofit sector. First, what’s DIFFERENT today in the world of direct mail, compared to 1987? Lots of things. Here are just a few that seem to me significant. Costs Direct mail used to be an excellent, reasonably inexpensive, medium for testing the viability of a new product or a new nonprofit organization. A new company or organization possessing some entrepreneurial spark could “bootstrap” the costs of a test that would accurately forecast long-term success or failure. Not so much in 2017. The effectiveness of direct mail as a testing medium is undiminished, but costs have risen dramatically. First Class postage today is more than double what it was in 1987. The cost of what we used to call “Bulk Rate” postage has followed a similar trajectory (though presorting and commingling opportunities can somewhat ease the pain), as have printing and mailing services and list rentals. If you want to do a direct mail launch in 2017, you don’t necessarily need resources as deep as a Buffett’s or a Trump’s, but you do need at least a pair of pants equipped with pockets. “Doubling date” If you were in this business in 1987, you probably remember that about 14 to 18 days after you dropped a “Bulk rate” mailing, you could count on having received about half of what would eventually be your total response. Today, it’s more like 30 days. So what, you ask? What’s the harm in waiting a few more weeks? Well, in 1987, with much faster delivery of your outgoing mail and speedier delivery of responses, you could hope to do a test, first round of continuations, and maybe two rollouts in a year. That is, four waves of drops. In 2017, it’s very difficult to squeeze out three waves in a year, and four is nearly, though not absolutely, impossible. If you pull it off, that’s a tribute to your or your agency’s very skillful mail schedule management. And this means, of course, that it takes significantly more time now than it did in 1987 to recoup costs and build a database of customers or donors large enough to fund at least the minimum level of new donor/customer prospecting you need to survive. So the slothful pace of today’s USPS is indeed a very big issue. Donor availability Here’s a final thought about the difference between 1987 and 2017 that looms large in our work here at LDMI: The donor universe is shrinking. At least in the markets where we can claim expertise — politically conservative donors and “traditionalist” Christian (mainly Catholic) donors. Back in ’87, people whose knowledge I respected used to say that there were some six million conservative direct mail donors “out there.” My educated guess is that today that number is more like two or three million. I’m not quite sure how many Catholic direct mail donors were accessible on available lists in 1987, but I’m quite sure the number today is no larger, and I think probably a lot smaller. And of course, you know this means the competition for those donors’ generosity is far tougher today. That makes a deep, detailed knowledge of the world of available mailing lists and their performance profiles — and sharply imaginative thinking about uncovering your donors’ profiles in “non-traditional” universes — essential qualities to bring to the complex task of managing a direct mail fund raising program. In a subsequent post here, I’ll discuss a couple of things in the direct mail world that, to me, look pretty much the same in 2017 as they did in 1987 . . . and why that’s a good thing.
Online giving for nonprofits is growing, but remember, it still makes up only a small portion of total giving. Traditional fundraising — direct mail, events, major gifts — still generates about 90% of total giving. It's important to allocate the appropriate percentage of resources toward traditional channels rather than focusing exclusively on online fundraising, which seems cheap and easy. Online fundraising is important, and should be integrated with your direct mail program, but it should not be overemphasized in light of its contribution to total giving. Check out Mart Pitam's blog "The Danger of Seeking 100% Online Giving" for more information.
Is your nonprofit missing out on potential donations because you aren’t reaching your donors? Or even worse, is your organization spending money on direct mail packages that never even reach your donors? If the answer to these questions isn’t a confident, “No,” then your nonprofit might be leaving money on the table. Your nonprofit might have the best creative in the world, but it doesn’t matter if your packages aren’t reaching donor inboxes. That’s why the upkeep of your donor database is a critical aspect of your nonprofit’s direct mail program. A healthy donor database provides a detailed view of all your donors and smooths the way for improved analytics. Whether you want to compile a comprehensive view of donor value, create upsell programs or develop complex list models, having clean data will better support these efforts and improve the performance of your marketing ventures. Up-to-date contact information and response data also allows you to improve segmentation of your donors based on their unique interests and partialities. This leads to better market targeting and tailored-made content and offers. This will transition to an overall better donor experience, and subsequently, promote better marketing results for your company. So, now that we know why clean data is so important, the next step is to learn about how to clean up your data! National Change of Address (NCOA) Before mailing your house or prospect appeals, you need to run your list against the NCOA database. This is an important step to ensure you are going to reach the intended donor in a timely manner. The NCOA database contains the “change of address” forms submitted to the U.S. Postal Service (USPS). When people move, they don’t always fill out “address forwarding” forms with USPS. And even if they do, it could take another week before your mail is forwarded to the right address. Plus, the USPS requires NCOA updates within 95 days to qualify for bulk mailing rates. Mailing at bulk rates is essential to almost all marketing campaigns, especially smaller nonprofits that have limited direct mail budgets. According to the U.S. Census Bureau, 11.2% Americans moved in 2016. That percentage may seem insignificant, but let’s say you send out a direct mail campaign to 10,000 people and 11.2% have moved. That’s roughly 1,120 donors you missed. If each of those donors were to give an average of $25, you would have lost a total of $28,000. Imagine how those funds, or even a fraction of those funds, could have helped with your cause! With everything people have to deal with when moving, contacting charities to update their personal info is likely not a top concern. This intensifies the importance of having the most up-to-date contact information, not only for your mailings, but stored in your database as well — readily obtainable for future communications. You cannot retain donors if you cannot reach them! Bottom line: Running the NCOA to ensure the hygiene of your database or list rentals is a solid investment and vital to ensuring the blood, sweat and tears put into your nonprofit’s direct mail efforts aren’t in vain. Contact Lawrence Direct Marketing today to start working together on building a better donor database and to start reaching clients with more effective creative to increase your net income.
The Lawrence Direct Marketing, Inc. team will be on location next week, August 3-4, at the 12th Annual Bridge to Integrated Marketing & Fundraising Conference. You can meet the LDMI team at the Solutions Showcase exhibit hall, Booth 124. The exhibit hall is open from 10 a.m. to 6:30 p.m. on August 3 and 10 a.m. to 2 p.m. on August 4. The Bridge Conference brings together direct marketing and fundraising experts to discuss the latest strategies, techniques and innovations in direct response marketing and fundraising. The conference is produced by the Association of Fundraising Professionals, Washington, DC Metro Area Chapter (AFP DC) and the Direct Marketing Association of Washington (DMAW). Lawrence Direct Marketing is a member of DMAW. Bridge 2017 will take place at the Gaylord National Hotel and Convention Center in National Harbor, Maryland (201 Waterfront Street, National Harbor, MD). More information about the conference is available at www.bridgeconf.org. We hope to see you there!
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