The Fine Art of LEVERAGE
Upcoming SlideShare
Loading in...5
×
 

The Fine Art of LEVERAGE

on

  • 601 views

 

Statistics

Views

Total Views
601
Slideshare-icon Views on SlideShare
600
Embed Views
1

Actions

Likes
0
Downloads
11
Comments
0

1 Embed 1

http://www.slideshare.net 1

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    The Fine Art of LEVERAGE The Fine Art of LEVERAGE Presentation Transcript

    • The Fine Art of LEVERAGE Leah Eustace, CFRE Jérôme St-Denis www.theflagroup.com
    • Let’s Start with Strategy
      • According to Mal..
      • you’ve got 5 choices
      • Growth
      • Involvement
      • Visibility
      • Efficiency
      • Stability
      • You can only choose one!
    • Food chain exercise (rank these on efficiency)
      • Special events
      • Monthly giving
      • Product sales
      • Legacy gifts
      • Major gifts
      • Telemarketing
      • Direct mail
    • The Efficiency Food Chain
      • Planned giving
      • Major gifts
      • Monthly gifts
      • Direct mail
      • Telemarketing
      • Events
      • Product sales
    • So if direct mail’s in the middle of the pack, why does it matter?
      • Judith Nichols has been telling us for years….
      • GO DEEP MORE THAN WIDE
      • cuz wide ain’t there anymore (for most of you, anyway)
      • direct mail’s your best bet for going deep
    • Who Gives?
      • we polled 500 Canadian direct mail donors
      • results accurate +/- 4.1% 19/20
      • for the first time (in 30 years) we found out exactly who gives through the mail
    • Meet Jacqueline
    • Age
    • Gender
    • Employment
    • Education
    • Household Income
    • Marital Status
    • Dependent Children
    • Attend Religious Services
    • The Formula
      • Four simple steps
      • to direct mail success.
    • Step 1 – the problem
      • we all love to talk about our problems
      • (Dr. Phil’s become rich off of them)
      • direct mail is no different!
      • if there’s no problem, why should I care?
    • Step 2 – the solution
      • I’ll care about the problem
      • I’ll give to the solution
      • no solution? no gift..
    • Step 3 - Credibility
      • I care about the problem
      • I’ll give to the solution
      • but why should I give to YOU?
      • does your letter have credibility?
      • does your organization have credibility?
      • then use it!
    • Step 4
      • in fundraising, what does the letter “A” stand for?
      • Clue: what’s the most common reason that people give to charity?
      • let’s go to your letters again
      • have you: asked? asked directly? asked specifically?
      • What is leverage?
      • Leverage
      • Market research can help a charity
      • upgrade single gift DM donors
      • to higher orders of giving.
    • Integration = Leverage = More Revenue
      • Who can name three
      • types of ‘higher order’
      • gifts that can eventually
      • come from direct mail donors?
    • Let’s compare ‘lifetime value’
      • average direct mail donor is worth about $250
      • monthly donor is worth ($13 x 12 x 6) = $936
      • ‘mid-level’ donor is worth ($500 x 6) = $3,000
      • ‘legacy’ donor is worth $20,000 (in ten years or so)
    • our big hairy idea!
      • leveraged giving comes from a small minority of your donor file
      • yet, leveraged giving can more than double revenue from direct mail giving alone
      • fundraising is not democratic!
      • Pareto principle 80/20 90/10 95/5
      • wanna make a name for yourself? Go Pareto!
      • And how does
      • leverage work?
    • Leverage – Monthly Giving
      • lifetime value of monthly donors is a multiple of single gift donors
      • lower cost to maintain
      • good legacy prospects
      • we’ve proposed a mail/phone/mail & phone test – with the potential to roll out
      • our research shows 60% give on the phone
      • you should target 5% to 10%
    • Monthly Giving
      • according to our poll, 95% of donors are aware of monthly giving
      • 34% have given monthly
      • 37% say monthly giving is a good idea
      • the phone is more effective than mail – best approach is mail/phone together
    • Leverage – Major Gifts
      • our poll indicates potential among direct mail donors for major gifts
      • despite modest income/education, civics are generous & loyal
      • 27% have made single gifts $500+
      • we’re recommending branding a giving club and soliciting current $500+ donors
      • our poll tells us that they’ll give to the offer – not for the recognition
    • Leverage– Legacy Gifts
      • 97% are aware of legacy giving
      • 92% of donors have a will
      • 18% say they’ve already named a charity
      • 17% likely to do so within five years
      • these donors are older empty nesters – kids are grown and gone
      • long on assets, short on income
      • majority have never been asked
      • they’re also civics (will boomers die broke?)
    • Legacy Gift Potential
      • average Canadian estate is $350,000
      • average charitable bequest is $20,000
      • modest $35 direct mail donors are capable of large legacy gifts because of their assets
      • Andrea’s story - $75, twice a year
    • Once upon a time…
      • A client success story
    • Where they started in 1999
      • thought they had 80,000 donors
      • database mess
      • no strategy
      • no reporting/analysis
      • didn’t know what worked or why
      • no donor focus – or donor choice
      • off the rails
    • Setting Goals - Direct Mail
      • grow file to 100,000 actives
      • average gift $37
      • gift frequency 1.2
      • gross annual revenue $3.33 million
      • revenue to cost ratio of 4:1
      • net revenue $2.5 million
    • Where they are today
      • donor base has doubled
      • net revenues have doubled
      • they know what works and why
      • put donor first – lots of choice!
      • segmentation, analysis, precision, efficiency
    • Where they started – monthly giving
      • In short, nowhere!
      • but got serious and started working monthly giving throughout the program
      • - segmented mail - web
      • - segmented phone - email
      • - door to door - newsletters
      • - back end - staff
    • Setting Goals -Monthly Giving
      • 7.5% file conversion
      • average gift $13 per month
      • gross revenue $1.17 million
      • revenue to cost 10:1 (or better)
      • net revenue $1.05 million
    • Where they are today - monthly giving
      • 4,200 active monthly donors
      • recruited from a variety of tactics
      • putting program in place (devil’s in the details – like expiring credit cards)
      • program today is worth $655,000/year
    • Setting Goals – Major Gifts
      • 3% of the file leverages up
      • 2/3 at $500, 1/3 at $1,000
      • gross revenue $2 million
      • revenue to cost ratio is 10:1
      • net revenue $1.8 million
    • Where they are today
      • Mid-level
      • active program to 1,500 donors, 5,000 prospects
      • branded program, segmented appeals
      • Major gift
      • also campaigning face to face
    • Legacy gifts – where they started
      • no program at all
      • no staff or resources
      • one brochure and nothing to do with it
      • receiving bequests by surprise
      • and yet, this HUGE potential
    • Setting Goals - Legacy Gifts
      • 100 bequests per year (1/1000 th of file)
      • average bequest $20,000
      • gross income is $2 million
      • revenue to cost is 20:1
      • net revenue $1.9 million
    • Where they are today
      • created a staff position
      • committed to a legacy marketing plan
      • Integrated legacy marketing into direct mail program & other media
      • early stages – 53 expectancies
      • $1.06 million
    • 5 Years Out – Adding It Up $7,250,000 Total Net Revenue $1,900,000 Legacy Gifts $1,800,000 Major Gifts $1,050,000 Monthly Giving $2,500,000 Direct Mail
    • Guess what?
      • Leverage works
    • Wanna be a star?
      • Employ a leverage strategy by following a few simple steps
      • run a kickass direct mail program
      • keep the base strong
      • use market research to target segments and tailor messages
      • stick to the strategy
      • give it five years to work
    • Remember…
      • “ Deep more than wide”
      • Call us in 2010
      • and name your price!
    • Leah and Jérôme’s ten tips to successful direct mail
      • “Demographics is two-thirds
      • of everything.”
      • (never forget Jacqueline)
    • Tip 2
      • Mail is a program – not a
      • project. You must build on
      • previous experience.
    • Tip 3
      • “Fancy-schmancy”
      • It’s okay to keep it simple!
    • Tip 4
      • Everybody – and I mean
      • everybody – loves a good story.
      • So tell one!
    • Tip 5
      • Don’t get too many grubby
      • fingerprints on your copy!
    • Tip 6
      • There’s no substitute
      • for research and analysis.
      • (invest a little money)
    • Tip 7
      • Always remember the formula
      • Problem
      • Solution
      • Credibility
      • Ask
    • Tip 8
      • Don’t do direct mail in a silo..
      • Integrate with monthly, major, legacy
      • stewardship, events etc.
      • (seamless, baby)
    • Tip 9
      • Test something
      • every time.
      • (sloth is a deadly sin)
    • Tip 10
      • Marry art and science..
      • …and you’ll win
      • BIG TIME
    • For more information visit www.theflagroup.com