Update on the Cost of Embalming An Elephant

I know that’s a strange headline, but I wanted to call your attention to something so basic that I’m constantly amazed so many fundraisers simply overlook it.

I’m talking about the basic data of our trade – names,  addresses, deceased donors and fundamental demographics—the very “simple” stuff that makes the difference in any donor communication and fundraising program.

At the beginning of the week we updated you on the progress of CopyOptimizerUpdate on the Cost of Embalming An Elephant over the past year.  As I worked on that and noted Claire Axelrad’s post urging us all to remember the importance of direct mail I decided to also do an update on some of the tools The Agitator and our sister companies Donor Voice, TrueGivers, and DonorTrends  have created to increase the effectiveness of direct mail.

A Reminder  of the Power of Mail

I fear the dazzle of digital has blinded many fundraisers to direct mail—the true workhorse of our trade. Contrary to the myth that “direct mail is dead”, the real world fact is that it’s very much alive and, in many cases growing.  ( See Agitator post here.)

In an effort to understand why so many organizations –particularly smaller groups—are under-utilizing direct mail we conducted a survey.  Our post, Missing Out:  Small Organizations and Direct Mail summarizes the results of that survey.

In a nutshell:

  • Smaller organizations are not taking advantage of the power of postal mail.
  • 20% of the respondents felt that most organizations are unaware of the difference in response rates between digital and postal mail. But…assuming the other 80% are more or less aware of the greater financial potential of postal mail, why is it that 33.3% of the respondents feel that “smaller organizations are making too little use of postal/direct mail”?
  • In priority order here are the reasons why smaller groups are not taking advantage of the power of postal mail.
  1. “Too expensive”
  2. “Management believes we can do it all online.”
  3. “Too much hassle with the logistics of printing and mailing”
  4. “Don’t have time”
  5. “Don’t know enough about how to use direct mail.”

For those of us who care about the well-being and growth of smaller organizations, these findings are deeply disturbing.  Given the fact that a recent Direct Marketing Association (DMA )study noted that average response rates from direct mail at 4.4% are a whopping 37 times higher than average email marketing rates at a mere 0.12%.  Other studies show the same disparity although the open, click-thru and response rates vary slightly

Some Basic Tools for More Effective Direct Mail

Over the past 4 years we’ve worked with our sister company TrueGivers  to build and call attention to simple, inexpensive tools that solve the most fundamental problem

ADDRESS CORRECTION.  In the post Premature Exoneration you can see the high cost of neglecting this most basic of fundraising fundamentals. “How accurate are the donor addresses on your database?” As fundamental and simple as this question is, I’ve found that few fundraisers can truthfully answer that question.  And that same number could probably care less. After all, as “fundraising professionals we have higher, more sophisticated issues to deal with.”

This basic housekeeping function of keeping addresses clean and updated is neglected at enormous cost.  A review of the practices of  updating donor addresses and identifying deceased donors over a group of 1,200 small and mid-sized organizations containing a total of 9.6 million records. Our review found 545,000 bad addresses (5.66% of the total) and 268,000 deceased donors (2.79% of the total).  That’s a lot of wasted appeals and communications…lots of lost income and donor retention…and a ton of reputational damage.

If you apply Clay Buck’s Compounding Data Quality exercise and assume an average gift size of just $40 in the first year alone those 1200 organizations would have lost $21.8 million. And if those addresses were not corrected the five-year loss would exceed the $100 million mark.

An Inexpensive, Automated Solution for Bad Addresses.

 In 2017 we placed TrueNCOA inn the Agitator Toolbox. This is automated, flat-rate, address correction service available for $20 regardless of file size.

As of this writing ( evening of June 10) TrueNCOA has processed 8 893, 078 and saved clients and estimated $561,024,900 in direct mail costs.  Customers save an average of $8,090 on postage and returned mail.  Not bad for an investment of $20.

Even before you spend that hard-earned $20 you can get a free NCOA Report on the accuracy of your file’s addresses here.

True NCOA has also been integrated into many CRMs.  One CRM, Bloomerang, offers nightly updates without charge as part of its basic subscription.

DECEASED DONORS.  When The Agitator first announced our Data Liberation Crusade and asked what low-cost data services were needed, reader Ann Kensek told us, “My Data Dream would include a database where I could find names of those who passed away. Not only could we send a sympathy note/card to spouses/ family of deceased donors, but we’d be able to avoid mailing to John and Jane Doe if one or both of them died.”

An Inexpensive, Automated Solution for Bad Addresses.

In 2018 thru the post Avoid the Cringe-Inducing Moment of Calling a Deceased Donor we introduced TrueDeceased by placing it in the Agitator Toolbox.

In my experience most organizations don’t pay any or much attention to flagging, suppressing or otherwise dealing with families of deceased donors.  Remember, in the review we did of 1200  small to mid-sized organizations we found 268,000 deceased donors (2.79% of those files)

For some commentary how the feds could have spent $50 on TrueDeceased and saved $1.6 billion see our post Embarrassed by Death. Educated by Hot Pants that also includes commentary on how this applies to nonprofits.

By the way, when deceased donors are located on your file the analysis comes with biographic and cemetery information from  Find A Grave.

The all-inclusive cost for running TrueDeceased is $50 regardless of file size.

DONOR BASE PROFILE.  I can’t begin to count the number of board meetings I’ve attended where trustees asked the development director about the profile of the file—age, income, marital staus, etc.    Historically, this has been complicated and sometime expensive information to acquire.

No more.

Profile Your Donor base Free and In Minutes

That’s why we added TrueAppend  to The Agitator Toolbox. This easy-to-use tool enables you to go online and quickly—and without charge – get a demographic overview of your donor database.

In a matter of minutes, you’ll receive charts and graphs identifying key characteristics of your donors.  Attributes like Age, Net worth, and Income.  Lifestyle markers like marital status, presence of children, home ownership and political party.

As an Agitator reader, you can go online and get your organization’s TrueAppend Report (check out a sample here) absolutely free.

Then…if you want to append information specific to your donors –for example age, income or some other attribute—you simply purchase only those attributes you need for the low cost of $10 per thousand records matched.  No minimums. No contracts. See before you buy; buy only what you need.

Here’s what you do with TrueAppend in minutes.

  • Match your list against demographics data
  • Prepare attribute-level match rates to support your own analysis and segmentation projects
  • Conduct free attribute-level analysis to understand the Age, Net worth, and Income distribution of your constituency
  • Identify lifestyle markers like marital status, presence of children, and home ownership
  • Seek cultural understanding through heritage and religion data
  • Create demographic profiles using your new data, or enhance your existing profiles

U.S. Agitator  readers can sign up for free at TrueAppend.com, where you’ll find all the details about putting it to work for your organization or your clients.

Beyond The Basics. Way Beyond

In addition to the basic, fundamental functions that can now be performed in minutes and for pennies, there are two other goodies we’ve played a part in creating and advancing where direct mail (and digital also) is concerned.

You’ll want to go to the Agitator Toolbox and check out the multi-variate testing tool than enables you to avoid the slow, laborious and costly A/B Split and test hundreds of elements at the same time.  No wonder we call it 18 Months’ Worth of Testing in a Day.

Since all effective human relationship involve two-way communication most organizations should be seeking donor feedback.  Most don’t.   We tried to fix this with a widget that you can put on your website use in your direct or digital mail and open up new vista of opportunity that comes from listening to you donors.  Check it out here.

And if you’re interested in the efficiencies and marked effectiveness of predictive analytics you want to learn of the benefits that the powerful suite of segmentation tools presented by DonorTrends.  If you want to save hours and hours on segmentation…boost the efficiency of your programs…and find hidden opportunity across a range of programs from 2nd gift to Mid and Major gifts, Planned Giving and Reinstatement check out DonorTrends.

What’s Next?

When we launched the Agitator Data Crusade with a  post titled Fundraising Data And The Cost of Embalming An Elephant we asked readers what sorts of data they needed, wanted or dreamed of.  They responded and we enlisted skilled colleagues in sister companies to build it.  They did.

Now, as we face the future it’s time to re-issue that request: what are your data dreams?  Please send em along either in the Comments section or directly to me: Roger@theagitator.net.

Roger


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