Mailing smarter means segmentation

gg60855672When you segment your membership or donor file, you select some individuals to include while leaving others out. Those you include may be further divided into subgroups that receive packages distinguished by variations in one or more of the Three P’s: Packaging, Postage, and Personalization. By intelligent segmentation of your donor file, you can cut mailing costs, upgrade donation levels, and minimize complaints from your supporters. Here are 5 simple guidelines to follow:
  1. Don’t reinvent the wheel. Three criteria stand out above all others as predictors of direct mail donor behavior: recency, frequency, and gift amount. Don’t assume you can beat the system by ignoring these three criteria and arbitrarily substituting others. [As with every rule, of course, there are exceptions. For example, two factors that might weigh as heavily as recency, frequency, or gift amount in some circumstances are the original source of the name (non-direct-mail sources generally produce much less responsive donors) or whether a premium has been used as an incentive to obtain the first gift.]
  2. Remember: some people give more money than other people. Mail most often to those donors who give most frequently, or who have contributed most recently, or whose individual gifts have been the biggest. These are your prime prospects for gifts right now, and they’ve demonstrated their interest in your organization. They’re worth extra attention. By contrast, those who don’t fit these criteria are worth less attention – and less investment in the Three P’s.
  3. Remember, too: if some people are more equal than others, a smaller number are the most equal of all. If your donor file consists of 10,000 names or more, the top 10% to 30% – as defined by Recency, Frequency and Highest Previous Contribution – are worth extra-special attention. Many nonprofit organizations benefit greatly from extra mailings targeted exclusively on this core group. For example, if you’re accustomed to using bulk postage in your resolicitations, a core group mailing could be sent via first class mail; it’ll probably work even better if you use “live” stamps. And if you normally use mailing labels on your donor appeals, these same people are likely to be worth an investment in personalization, which is likely to increase your mailing’s impact by getting more donors to pay attention.
  4. Stop beating dead horses. If members or donors have failed to respond during the past 36 months, stop asking them for money. They’re a lost cause. [But here are two things you can do to break this rule: if you’re actively prospecting by mail for new members, include these former members in your acquisition campaign. You could also try calling them by phone in an effort to persuade them to reactivate their support for your organization. Most groups find that both these types of activity work well.]
  5. Don’t try to squeeze blood from turnips. If the average contribution in your direct mail fundraising program is more than $15, you may be wasting money with repeated mailings to donors of less than $10 gifts. Many big mailers profit from appeals mailed to donors of gifts from $5 to $9.99. But even they rarely mail to donors of less than $5 gifts.
Mal Warwick is founder and chairman of Mal Warwick | Donordigital and the author of twenty books on fundraising. His most recent book is The Business Solution to Poverty with Paul Polak.

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