February 9, 2010, fundraising success, By Tiffany Neill
As the recession has deepened, acquisition of new donors through direct mail has become more difficult. In a session titled “Keep the Acquisition Ideas Coming: List Optimization" at the recent DMA 2010 Washington Nonprofit Conference, four speakers provided techniques to refine selection of prospect lists to improve acquisition results.
The goal of optimization is simple: Mail appropriate acquisition packages to people most likely to respond. This improves results and decreases costs.
Angelo Licursi, director, account management, at Paradysz, explored many ways to improve list selection and mailing. First, if you have different acquisition packages, he recommended, analyze results to determine if certain lists respond better to one package, and mail accordingly. For example, some lists might respond better to a premium mailing than others. Another technique to determine which package to mail is to analyze past mail files and find people who have been mailed several times, but never contributed. Then, test packages to those individuals.
Other ideas include working with regular exchange partners to trade segments of donors who are not usually exchanged: For example, exchange donors in the last three months. He also advised groups to study details of the merge-purge reports. One list might share such a high percentage of donors with another list that it doesn't make sense to take both of them for the same mailing.
Both Licursi and Glenn Gibson, director, strategic marketing at National Wildlife Federation, talked about improving acquisition response rates by creating response models that find high-performing zip codes and selecting those areas only from marginal lists.
This kind of modeling, as well as other prospect models Gibson discussed, can significantly improve acquisition performance. A data model can find prospects most likely to respond because they “look” like people who already donate (based on who else they give to, how much they give, where they live, or countless other demographic or philanthropic factors). This also is a great way to find people who have interacted with an organization in another way — signed a petition, volunteered at an event — to actually make a gift.
Converting internal non-donors to donors is a subject well known by Cheryl Lovinsky, associate director of direct response marketing at the American Diabetes Association. ADA has more than 9 million people who have participated in events, requested information or otherwise interacted with a local chapter. Lovinsky is utilizing modeling techniques to find people in this large group who are most likely to contribute and then mail to them to keep costs manageable.
I offered a case study of an organization that used list optimization to improve donor value. It didn't focus on increasing the response from acquisition, but rather sought to increase average acquisition contribution by excluding prospects who were likely to contribute $5 or less. Modeling techniques made it possible to identify these prospects, eliminate them from mailings, and then alter the package to appeal more to the higher-value donors.
Tiffany Neill is partner at Lautman Maska Neill & Co.