DonorPerfect by i33O8b

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									                            Mailing Smarter
                           September 20, 2010




 Mailing Smarter: Using your
Database to Its Fullest Potential
           Presented by


            Jon Biedermann, Vice President
                      (800) 220-3593
              jbiedermann@donorperfect.com
                                                 Mailing Smarter
                                                September 20, 2010




               Jon Biedermann, Vice President
                         (800) 220-3593
                 jbiedermann@donorperfect.com



   15+ years Experience in Non-Profit Software Solutions
   Created DonorPerfect Online, one of the 1st Web Based CRM
    Fundraising Software Solutions (2001)
   Responsible for 10,000+ clients, 100+ employees, 4 children,
    and 2 cats (or at least I try).
                                           Mailing Smarter
                                          September 20, 2010



                          Agenda
• Welcome/Introduction
• Creating the Right List to Mail
   – Recency, Frequency, Amount
   – Segmentation Recording
• Cleaning Lists
   – Deduping – Merge/Purge
   – NCOA/CASS Certification
• Sending the Mail
   – 1st Class vs. Standard
   – Automation Compatible Mail
• Technology Tools to Increase Efficiency and Revenue
   – Email / Online Giving / Facebook / Twitter
• Summary
• Questions & Answers
                  Mailing Smarter
                 September 20, 2010



Who is still sending mail?
                         Mailing Smarter
                        September 20, 2010



     Who is still sending mail?
Less mail, but still 167 Billion Pieces
                         Mailing Smarter
                        September 20, 2010



    Recency, Frequency, Monetary
• Recency – How long has it been since
  this donor gave $$?

• Frequency – How many Gifts have this
  donor given?

• Monetary – What are the size of the
  gifts?
                                                      Mailing Smarter
                                                     September 20, 2010

    Recency, Frequency, Monetary
• Recency
   – The #1 Predictor of Giving
   – Average best segment, 3-6 months
• Frequency
   – 2+ Givers > 1 Givers > 0 Givers (Prospects)
   – Converting 1 Givers to 2+ Givers increases LTV
     SIGNIFICANTLY
• Monetary
  – Who to send mail?
     • 0-18 months Recency, $10+ Average Gift
     • 0-24 months Recency, $100+ Average Gift
     • Peak Season – Mail everyone 0-36 months
                  Source: TrueSense Marketing, www.truesense.com
                                                  Mailing Smarter
                                                 September 20, 2010

     Recency, Frequency, Monetary
         Putting it All Together
• Recency
  – Rank your donors by sorting them in reverse order since their last gift
    (Donor Databases should do this, Excel will work)
  – Assign a ‘5’ to the top 20% (the most recent), a ‘4’ to the second 20%, a ‘3’
    to the third 20%, a ‘2’ to the fourth 20%, and a ‘1’ to the last 20%.
• Frequency
  – Rank your donors by number of gifts in the last 2 years
  – Assign a ‘5’ to the top 20% (the most gifts), a ‘4’ to the second 20%, etc.
• Monetary
  – Rank your donors by amount of their Average Gift (last gift amount can
    work too)
  – Assign a ‘5’ to the top 20% (the major donors), a ‘4’ to the second 20%,
    etc.
                                                  Mailing Smarter
                                                 September 20, 2010

        Recency, Frequency, Monetary
            Putting it All Together
•   Each Donor now has a 3 part RFM score that describes their giving tendencies
     – A 5 – 2 – 1 Donor has given recently, has given a small number of gifts,
       and gives a small donation amount.
     – A 1 – 1 – 5 Donor gave a single large gift a long time ago.
     – A 5 – 5 – 5 Donor gave recently, gives often, and gives major gifts
     – What’s the average donor score? 3 – 3 - 3


       By targeting segments 3 and higher,
       you will avoid segments that under
         perform to the average, thereby
             raising your net income
                                                            Mailing Smarter
                                                           September 20, 2010

           Recency, Frequency, Monetary
               Putting it All Together
•   Scenerio #1 – no RFM segmentation
     – You mail to your entire list of 100,000 names, at a cost of $2 each, a response rate of
       10%, and an average gift amount of $30.
     – Results? You spend $200,000 and make $300,000, for a net profit of $100,000.


•   Scenerio # 2 – RFM Segmentation
     – You rank the list based on Recency, Frequency, and Monetary. Instead of mailing to
       all of the X – X – X segments, you choose the top 33 or so (the 27 with a 3 or higher,
       plus some additional ones, such as 2 – 2 – 5 (not so recent, but a major donor)
     – You send mail to these 26,400 donors, at a cost of $2 each, and receive a higher
       average gift amount of $40. But your response rate among these higher quality donors
       increases to 20%
     – Results? Your cost decreases to $52,800, and you make $211,200 for a net profit of
       $158,400 – or more than 50% the net income if you mailed to everyone.
                                  Mailing Smarter
                                 September 20, 2010

      Recency, Frequency, Monetary
          Putting it All Together

• There is no exact ‘right way’ to implement RFM

• Always record your segments – used later for more
  analysis

• Test, Test, Test!
                                  Mailing Smarter
                                 September 20, 2010

    Cleaning Lists for Deliverability
• Dups Galore! Make sure your database has a good De-
  Duping Utility
                                      Mailing Smarter
                                     September 20, 2010

    Cleaning Lists for Deliverability
• Merge/Purging with Outside Lists
                                               Mailing Smarter
                                              September 20, 2010

     Cleaning Lists for Deliverability
• Deceased Notifications
   – Still mail to them, even if marked.
   – Many people still give to remember the legacy of their loved ones.
• NCOA – National Change of Address
   – People move, on average, once every 7 years
   – Not everyone files their forwarding address, so still use 1st class
     once/year at peak time if possible.
• CASS – Coding Accuracy Support System
   – Standardizes Addresses to ensure deliverability
   – Reduces your postage rate for standard mail
   – Needs to be processed within 95 days of your mailing
                                                Mailing Smarter
                                               September 20, 2010

                        Mailing the Mail
• First Class
   – 1st Class will get delivered- perhaps surprisingly so- even to
      incomplete addresses
   – 1st Class will get forwarded
   – Best practice is to send one mailing a year 1st class to get forwarded
      addresses not revealed by NCOA
• Standard Mail
   – Rates vary based on pre-sorting (3 digit, 5 digit) and delivery to
      distribution centers
   – Automation compatible mail gets you the lowest cost (Bar coding,
      size restrictions, text placement, etc.)
   – Best advice – Talk to your REGIONAL Postmaster. They are in the
      best position to help and can also help with errors in your mailings,
      and still qualify for the lowest rate.
                                                                             Mailing Smarter
                                                                            September 20, 2010

                                        Mailing the Mail
• Donor ID / Promotional Codes on Reply Device
   – Makes data entry more efficient in donor databases
   – ‘Promo’ codes combine the Donor ID and Segment Code to further save time
• PLANET Codes
   – Track your mailing – much like UPS Tracking codes- across town or
     across the country
   – Are printed directly on the piece
   – Require a subscriber ID assigned by USPS
   – Requires Preshipment Notification to USPS
   – Prices range from $1000/year to $25,000/year - $1000/year plan
     would cover 200,000 tagged pieces. (Source:
      http://www.usps.com/mailtracking/_pdf/Confirm_Price_Information.pdf
                 Mailing Smarter
                September 20, 2010




  Should you
use in-house
 resources or
  Outsource
(Out-House)?
                                              Mailing Smarter
                                             September 20, 2010

            In-House vs. Out-Sourcing
• In-House makes sense generally when…
  – You have a low volume (< 5000), staff (paid or volunteer), software,
    and equipment.
  – You are targeting larger donors
  – You are sending 1st Class mail
• Out-Sourcing makes sense when…
  – You are mailing a larger volume (> 5000 pieces)
  – You do not have staff or equipment
  – You do not have software tools to run RFM, De-Duplication, CASS, or
    NCOA, etc.
                                                        Mailing Smarter
                                                       September 20, 2010

    Combining Mailing with Technology
• Asking the Right Amount
   – The “Monetary” part of RFM takes care of this to some degree
   – Base the ask within the appeal on a 3-4 option based on their
     average gift size. (Donor Databases and Direct Mail shops will do
     this for you)
   – Use a formula to determine Ask amount, Example:
     Ask Amount = (50% * AVG_GIFT) + (30% * LAST_GIFT) + (20% * MAX_GIFT)

• Getting Email Addresses
   – Average income from those who have an email address on file was
     $60 per donor in 2009 compared with $45 per donor for those who do
     not have their email on file with the non-profit organization
     (Source: DonorPerfect Online Client Statistics)
                                                          Mailing Smarter
                                                         September 20, 2010

    Combining Mailing with Technology
• Getting Email Addresses (cont.)
   –   Include a space for Email Address in the reply device
   –   When reply is received, send thank you letter in the mail AND Email.
   –   Include your website, Facebook, and Twitter account in the appeal.
   –   Communicate to Donor across BOTH channels.
• Driving Donations to the Web
   – Web Donations are typically 20% higher than Direct Mail
       (Source: DonorPerfect Online Client Statistics)

   – Needs to be easy for the Donor, AND tracks back to your segment.
   – Personalized URLS
          • Are short web addresses unique to the donor that contain all of their info
            Examples:
                  – tinyurl.com/DONOR_LAST_NAME_999
                  – www.YOUR_ORGANIZATION_NAME.com/DONOR_LAST_NAME_999
                                                        Mailing Smarter
                                                       September 20, 2010

                                   Summary
•   RFM lowers TOTAL revenue, but increases Net Profit
•   Cleaning lists (De-Dup, CAAS, NCOA, etc.) increases mailing efficiency and
    response rates
•   Don’t forget to send 1st Class- 1st class mailings find donors that are otherwise
    lost forever.
•   Tag reply devices with the donor’s ID = efficient data entry
•   Outsource larger mailings UNLESS you have
      – Staff
      – Software
      – Equipment
      – Delivery Trucks 
• Get the Donors email address = Higher average gift
• Drive more revenue and increase retention by directing donors to use
  online donations or personalized URLS.
          Mailing Smarter
         September 20, 2010




Questions??
                                Mailing Smarter
                               September 20, 2010




          Thank You!
 Mailing Smarter: Using your
Database to Its Fullest Potential
        Jon Biedermann, Vice President
                  (800) 220-3593
          jbiedermann@donorperfect.com

								
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