Here’s the Truth, the Whole Truth and Nothing But…about the Lie

October 3, 2018

That’s right, lie, misinformation, myth, or fake fact, in today’s vernacular. We hear it all the time and it just isn’t reality. Here’s the lie: On-line fundraising is replacing direct mail.

 

And here’s the true story behind it:

 

We have a particular client who has asked for (and shall receive anonymity) who enjoys great online success. We applaud them. As a result of their success, they are leaning heavily on the side of discontinuing their direct mail acquisition efforts. As you know, acquisition requires a costly up front investment with a break-even point occurring at some time around the end of year 2 or during year 3. The board of directors of this particular organization is strongly recommending an end to their direct mail acquisition efforts, as well.

 

Looking simply at the numbers, it is undeniable that online is showing itself to be more cost effective than direct mail. As a matter of fact, there are more than a few of our clients who report a stunning Return on Investment from online—thus, they also are considering ceasing direct mail.

 

Here’s the problem though: online fundraising isn’t something that can be built upon. Today, we call that not being scalable. So it’s relatively easy to get a great $25,000-$50,000, but when what you need is hundreds of thousands of dollars in funds, well, that’s another story altogether.

 

In fact, it’s informative to note that we have seen a specific correlation between online revenue and drop dates in acquisition (2014-2015). What we saw was that though online earnings had been increasing over this 2-year period, in this client’s sector (religion) by 10-17%, online revenue for this client had actually decreased by 10%, which means a real decrease of between 22-25%.

 

Interestingly, the investment in direct mail prospecting in 2014 was about 5x as great as 2015. We then uploaded the prospect files and matched online donor names to those that appeared on the acquisition lists.

 

Are you ready? We found that a whopping 28% of total online revenues- both renewal and acquisition-had come from donors who received acquisition mailings.

 

The lesson? Beware of silos in your fundraising and communications. It’s true that the number of ways to talk to people continues to grow. So do their options to respond

 

back. It’s very difficult to know exactly what message will encourage a gift.

 

To you we say, don’t be afraid to try things. Impress upon your team that all of you should be working toward the same goal. Not a direct mail and not an online goal.

Don’t assume that a direct mail donor will only use their response form to make a gift.

 

At Rescigno’s we’re encouraging different options:

  • We’re increasingly advocating online response in direct mail pieces.

  • We’re strongly suggesting multi-channel donor communications—email, direct mail, social media, etc.

  • Vigilance when it comes to gathering donor contact information—mail and email addresses, cell phone numbers, etc.

 

Want to talk about it? Give us a call!

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