Wise use of a nonprofit's mailing list budget has become more crucial in the past few years. "Organizations are finding it harder to acquire new donors to replace those who have stopped giving," says John Mastrobattista of the Cambridge, Mass.-based Target Analytics division of Blackbaud , which is based in Charleston, SC. While the amount each donor is giving, has, on average, remained stable over the past few years, the number of donors has decreased.
Top of the List
Most nonprofits work with agencies to acquire new mailing lists, says Mastrobattista. The agencies obtain lists from brokers, and often combine 20 or 30 lists and perform "demographic overlays" on the combined lists, pulling out the best prospects based on geography, income, household size, number of children, and many other demographic factors.
The agency then usually checks that list against the Direct Marketing Association 's "eliminator file," which includes people who have asked to be excluded from mailings. The agency (or the nonprofit itself) may then run other procedures to eliminate duplicate names and addresses. This is often followed by a test mailing to see what the response is from a random selection of a few thousand names from the filtered list. If the response meets thenonprofit's performance standards, a larger mailing will then be sent out.
Organizations may have many different lists, and Target Analytics examines many variables to determine those lists most likely to perform well in a given situation.
"Predictive modeling is not a piece of software that's for sale," explains Mastrobattista "It's a process. We do many kinds of data analysis, for specific organizations, with the intent of optimizing the lists already in house or after they've been rented." Target examines demographics, timing (behavior changes during an election year, for example), and other variables to construct models.
Although predictive modeling can be very effective, smaller nonprofits, like the North Carolina chapter of the National Alliance on Mental Illness (NAMI NC), face more fundamental problems in both acquiring and managing lists. "We don't buy lists," says Debra G. Dihoff, NAMI North Carolina's executive director. "But we're involved in lots of coalitions and we get different lists from different groups." In other words, her organization uses the old fashioned, but tried and true, method of trading lists with similar organizations.
The biggest challenge for NAMI NC, says Dihoff, is getting the most out of about 25 in-house lists, obtained through a variety of methods. A recent project, says Dihoff, was "migrating all of our email addresses to a shared drive. It was costly, but now we'll achieve an economy of scale." Dihoff says another key task is prioritizing the lists based on what they're going to be used for. But with a limited budget, she says, "You have to be creative and use your technology intelligently."
One of NAMI NC's other major efforts, and perhaps its most important, is an ongoing drive to obtain email and snail mail addresses simultaneously. Dick McPherson, the president and creative director of McPherson Associates (Malvern, Pa.), says nothing is more valuable than having both pieces of information.
"With email communications," says McPherson, "donor retention goes up, gift size typically goes up, gift frequency goes up, and so forth. The cost-benefit is very clear and it's becoming more valuable with each passing year." He stresses that there's a big difference, though, in that "with email lists, the issue is attracting visitors to your Web site and encouraging them to register to receive e-communications from your organization." Organizations can also pay services to locate email addresses of existing supporters, using a method called email appending.
About 80 percent of people who register to receive email from a nonprofit also will provide their regular mailing address, according to McPherson. And there's more good news. "If you send a fundraising appeal to a non-donor who has registered online, the direct mail results are often eight to 10 times higher than they would be on a list acquired from an agent or broker. And usually the online registrant has asked to continue to hear from you."
This is in contrast to traditional lists, which are rented (and therefore must be rented again to be used again). And organizations that have been focusing on obtaining both email and regular mail addresses through their Web site now "have enough experience to be able to forecast, fairly accurately, what the level of Web site traffic means both in terms of their list development and their donor list development." McPherson cites Defenders of Wildlife as a nonprofit which has been using these methods very effectively.
Acquiring mailing lists and optimizing their use for maximum fundraising effectiveness has been, and always will be, a challenge for nonprofits. But over the past 10 or 15 years, new methods, including simultaneous email and snail mail communications and predictive modeling, combined with increasingly robust hardware and software that can sift and sort lists to meet an organization's specific needs, have increased the mailing options for even the smallest nonprofits. And for fundraising, the more a nonprofit focuses in on obtaining both electronic and regular postal addresses for potential donors, the more successful its campaigns are likely to be.
Last modified on Sunday, 19 May 2013