| |
| |
|
Marketing Information |
|
|
|
Fundraising Letters Should Raise Donors, Not Donations, When Mailed to Strangers
Are you willing to spend $1.25 to raise $1? To lose money to make money? You should be. Most donor acquisition mailings never pay for themselves. They lose money. And rightly so. Acquisition letters (letters designed to acquire new donors) should be a vital part of your development program. Current donors fall away. Some lose interest in your mission. Some lose their jobs. Other leave the country. Some die. You need to be mailing fundraising letters to people who have never supported your cause in order to replace the donors who fall away every year through no fault of yours. But to be successful at acquiring new donors, you need to ignore one set of numbers and fix your eyes on another. The numbers to "ignore" are the costs of getting your first donation. According to James Greenfield, in his excellent book, Fund Raising (second edition), you can expect to pay anywhere from $1.25 to $1.50 to raise $1 with an acquisition mailing. That doesn't sound like a wise use of your resources, does it? But with acquisition fundraising letters, you need to have your eyes fixed on the lifetime value of your donor, not the short-term value of their first gift. You need to remind yourself (along with your board members, key volunteers and inexperienced colleagues) that your goal with acquisition mailings is to acquire friends, not funds. Let me illustrate. Let's say you mail a fundraising letter to a list of 10,000 strangers. These are people who have not supported your organization before but might. Assume that your costs for writing, design, production and postage come to $0.60 a piece. Your mailing costs are thus $6,000. Let's say you receive a 1 percent response rate. That's 100 gifts. Further assume that the average gift is $30 Your income is $30 x 100 donors, namely, $3,000. Your costs are: $6,000 Are you in trouble? No. Here's what you tell your executive director. "We gained 100 new donors. And up to 80 percent of them will give again, provided we follow up properly and solicit their gifts in the right way in the future." Each of these new donors effectively cost you $30 each (your net loss divided by total new donors). Are you willing to spend $30 today to raise a friend who will likely give your organization hundreds of dollars in gifts in years to come? You should be, provided you can remember that your goal with acquisition letters is to raise a donor, not a donation. My thanks go to Stanley Weinstein and his book, The Complete Guide to Fundraising Management (second edition), for his insight into the economics of donor acquisition. About the author © 2005 Sharpe Copy Inc. You may reprint this article online and in print provided the links remain live and the content remains unaltered (including the "About the author" message).
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
Identify The Ideal Target Audience With These 5 Tips Narrowing your focus to one primary group of people is often difficult for small business owners. They want to help everyone - and very often their product or service CAN help a variety of people. Maslows Marketing Filter One of the basics of all marketing and advertising training is a teaching of "Maslow's needs pyramid". This pyramid shows the different motivators and needs in a person's life and how they are built one upon the other. Reverse The Risk And Boost Your Profits As a business owner or marketer, if you don't reverse the risk in your product and/or service offerings, you're really missing out in what can be one of the most powerful weapons in your marketing arsenal.Risk Reversal DefinedRisk Reversal, in essence, means that you, the business owner, assumes all the risks associated with the business transactions, and your customers none. Marketing Strategy - Getting the Marketing Groove Wouldn't it be great to have a year where your marketing efforts were streamlined and got the results you were after? None of us want to struggle with marketing, and yet this is the one topic that continues to be highest in the minds of small business professionals.Let's really consider some of the reasons that can sabotage our marketing efforts, and how we can turn that around. Where Are Your Leads Coming From? Most B2B marketers spend a great deal of time analyzing the performance of their programs and initiatives. The reason is obvious: With the growing pressure on marketing to produce measurable results, it's critical that every marketing dollar is invested wisely. Direct Mail Response Devices and How to Craft Them Successful direct mail packages contain three things: an attractive offer, a call to action, and a response device. The offer is the Incentive. Marketing Ideas Without Action Will Get You Nowhere! Marketing Ideas Without Action Get You NowhereYou want to grow your small business, but how do you do that? Many of the small businesses I work with are not really sure what works best, or how, or where to get started.We're all familiar with the term Marketing, but what in the heck is it really supposed to do for us?* Build brand awareness * Build name recognition * Increase market share * Get more clients * Generate referrals * Create more repeat businessMaybe you've tried some things in the past like brochures, yellow pages advertising, Chamber of Commerce networking but were disappointed with the results so you stopped doing them. Loyalty Cards - Tips To Consider Before Committing To One Loyalty marketing has been around for as long as retailing - attractive stores, good service, and a quality product line all contribute to building up a loyal customer base.With the growth of larger stores, a relatively new marketing component - the loyalty card - has been added by many retail outlets. E-commerce : The Bottom of Pyramid Approach For centuries and most of the decades in the 20th century (i.e when computer was invented) access and communication was the tool of rich and ultra rich people, prohibitively expansive to 'not so rich' and 'not at all rich' people. Marketing is More Than Advertising Marketing is a business process about which much is written, however is often not completely understood. Many think that "marketing" and "advertising" are interchange-able words. A Seven Letter Word That Helped a 3 Month Marketing Newbie to Online Success Who would have thought that a three month newbie and marketing dummy with no list, no product, no contacts, can actually make money online? Me neither.I had no idea what to do, how to do or why. The Process of Change in Marketing Approaches In a world economy that is in constant flux and undergoing turbulence, more companies are realizing that their most precious asset is their customer base. An even more important realization is the need to satisfy the whims and fancies of these customers in order to survive in these increasingly competitive markets. The Sweet Aroma of Highly Effective Marketing Highly effective marketing is accomplished when your marketing materials and marketing strategy work together to reliably move your prospects through your sales process.Have you ever caught a whiff of a tantalizing aroma wafting through the air as you walked down the street? With your senses suddenly alerted to something tasty nearby you notice the bakery on the corner. Your Marketing Message - Could You Wring More CASH Out Of It With This Ancient Japanese Discipline? When it comes to your marketing message, the little things count. Trouble is, you'll never come to respect how much, until you make a commitment to science. How to Turn More Referrals Into Paying Clients 60% of all small business owners, sales and solo-professionals claim that more than half of their new business comes from referrals. Yet when asked about the process they so successfully use to get those referrals and turn them into paying clients, most will have a puzzled, deer-in-the-headlights, stupefied look on their face, and keep quiet. Did Jesus Get Killed for Practicing Interruption Marketing? I'm reading Seth Godin's Permission Marketing and he brings up the difference between Interruption Marketing and Permission Marketing.Interruption Marketing is when you interrupt people from what they are doing in order to ask them to pay attention to something else. Five Most Common Mistaken Beliefs About Joint Venture Marketing Apart from being the fastest, easiest, and most profitable strategy for attracting clients and boosting profits in any small business, there are so many other advantages of joint venture marketing for all parties involved. So, why aren't all small business owners implementing joint ventures?Here's a partial list of the most common mistaken beliefs about joint venture marketing. The Secret to 100% Success With Your Marketing There's a secret to marketing, which is so simple, yet so effective once you learn it and apply it, you'll be amazed at the great results you can produce. This secret will prevent you from failing with your marketing pieces. Budget Your Branding It is very important to regularly monitor your advertising activities in the process of brand building, to realize how much they are contributing to the bottom line. Expediting marketing expenses wouldn't generally lead to a stronger brand name. Beyond Repair: The Fixed-price Model Don't get me wrong. I certainly don't think the majority of vendors who use a fixed-price model are trying to rip you off.
|
| home | site map |
| © 2006 |
