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Evolution Theory
How Market Impacts
Acquisition Package Testing
LISA MASKA, JENNIFER VANDERVELD, BETSY WASON
The goal is to acquire new donors – but not just
any new donors …
You want donors who will stay with you over the
years, a...
Increase Response Rate
Increase Average Gift
Lower Package Cost
Lower Cost to Acquire a Donor
Sometimes … Open Up New Mark...
Include a strong case for support
Illustrate how you provide a solution to a problem
Show how you are uniquely able to pro...
Reply form – Set the initial ask at the right amount
Carrier envelope – Use a teaser if you need it
Reply envelope – Pre-p...
Look at lists by category
Study the control packages of your best lists – these
are what the donors you are going after ar...
Track donor retention rates
– A lower response rate may be okay if you know you
are keeping more of the donors you acquire...
Case Study #1
Founded in 1985, the PCRM is a
nonprofit organization that:
• promotes preventive medicine
• conducts clinical research
• ...
Physicians Committee
Development Program
125,000 active donors
Multi-channel campaign includes:
– direct mail
– online mar...
Mailed acquisition gets 1% response
with $20 average gift
Animal welfare market fickle – lots of competition
PCRM donors g...
Rodney Control
What We Were
Up Against…
PCRM Markets
Animal welfare and protection groups
Advocacy groups
Catalogs
Our Strategy
For New Package
Many packages were unattractive and included coins
as incentive to give
Needed to differentia...
“No Coin” Test
1.64% response – 60% higher than the control!
73% increase in gross revenue!
THE RESULTS:
Response began to wane after a few campaigns
Aggressive package testing was needed…
But That’s Not The
End of The Story…
Incorporates
proven
successful
elements:
– Emotional letter
– Photos on OE
and in letter
– Three petitions
The “Animals Ha...
“Feelings” package beat the control but not as
dramatically as the coin package
Package costs relatively high
So, we tweak...
Market responsive to “urgent” campaigns
Campaign created around Alcohol Testing
Lower costs drive lower investment per new...
The Urgent Package Test
Check out your competition
Know your prospects
Make sure your package stands apart
Case Study #2
The Marine Corps Heritage Foundation preserves
and promotes the history, traditions and culture of
the United States Marin...
MCHF
Development Program
Campaign to build the National Museum of the Marine
Corps was launched in 2000
70,000 active dono...
Acquisition launched in 2000 at net profit
By Museum Opening in 2006, acquisition was at break-even
Today, acquisition get...
MCHF label control package has been hard to beat
Tweak tests have evolved package over time – adding
elements to maintain ...
What We
Were Up
Against…
Military history interest
Museums
Veteran related organizations
Catalogs and publications
Memorial groups
Political lists
...
First Test Package (2000)
No Premium
Winner:
$35
TEST: Initial Ask – $35 vs $50
The $35 ask lifted the response rate 36%
The gift was $53 - lower than with the...
Decal boosted response 58%
Gift dropped just 6%
Significantly more new donors
Boost in response more than offsets addition...
Labels boosted response 51%
Gift dropped 25%
Still, significantly more
new donors
And still at a positive
net per new dono...
Screened Marine Corps image on OE boosts response
Revenue up 13%
TEST: Adding a USMC Image on OE
Winner:
Image
Post-opening, needed extra incentive for donors to join
Discount offer increased response 28%
Gift only declined 14%
Disco...
Photo cards lifted
response 18%
Reduced
CTA by 9%
Helps illustrate
need to expand
Museum!
TEST: Adding Photo Cards
Winner:...
Lifted response 12%
Lifted gift 22%
Reduced CTA 58%
TEST: Adding New Images to Labels
It’s not like we aren’t
TRYING
to beat the labels…
Response rate
declined 35%
Average gift
soared 103%
Thanks to
additional revenue,
CTA was comparable
RETEST – the gift was...
Response rate
declined 30%
Average gift
increased by 50%
Costs for notecard
package were higher
Despite additional revenue...
Response rate declined 59% without labels
Average gift increased by 57%
CTA was comparable, but many fewer donors acquired...
Monitor performance over time
– If you are retaining new donors well and seeing donor value
increase, you can afford to in...
Thank you
Lisa Maksa, CFRE | Partner | Lautman Maska Neill & Company
with Jennifer Vanderveld and Betsy Wason
Evolution Th...
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DMA NF Evolution Theory

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How Market Impacts Acquisition Testing in Direct Response Fundraising

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DMA NF Evolution Theory

  1. 1. Evolution Theory How Market Impacts Acquisition Package Testing LISA MASKA, JENNIFER VANDERVELD, BETSY WASON
  2. 2. The goal is to acquire new donors – but not just any new donors … You want donors who will stay with you over the years, and upgrade over time And you want to acquire them at the lowest investment New Donor Acquisition 101
  3. 3. Increase Response Rate Increase Average Gift Lower Package Cost Lower Cost to Acquire a Donor Sometimes … Open Up New Markets Goals of Acquisition Testing
  4. 4. Include a strong case for support Illustrate how you provide a solution to a problem Show how you are uniquely able to provide this solution Establish credibility Tell stories Be emotional! Show how the donor can make an impact Ask Ask again Be a little bit repetitive! Elements of a Strong Acquisition Letter
  5. 5. Reply form – Set the initial ask at the right amount Carrier envelope – Use a teaser if you need it Reply envelope – Pre-pay postage if you can Inserts – Use additional components judiciously Premiums – Approach with caution Other Package Elements
  6. 6. Look at lists by category Study the control packages of your best lists – these are what the donors you are going after are responding to! Get to Know Your Market
  7. 7. Track donor retention rates – A lower response rate may be okay if you know you are keeping more of the donors you acquire Keep tabs on donor value – You can afford to invest more when you know donor value is high Monitor Performance
  8. 8. Case Study #1
  9. 9. Founded in 1985, the PCRM is a nonprofit organization that: • promotes preventive medicine • conducts clinical research • and encourages higher standards for ethics and effectiveness in research
  10. 10. Physicians Committee Development Program 125,000 active donors Multi-channel campaign includes: – direct mail – online marketing – telemarketing – events, personal solicitation and planned giving Program raises $10 million annually
  11. 11. Mailed acquisition gets 1% response with $20 average gift Animal welfare market fickle – lots of competition PCRM donors give to 20+ charities! Historically, PCRM control packages work for 18-24 months Constant package testing needed! Physicians Committee Acquisition Campaign
  12. 12. Rodney Control
  13. 13. What We Were Up Against…
  14. 14. PCRM Markets Animal welfare and protection groups Advocacy groups Catalogs
  15. 15. Our Strategy For New Package Many packages were unattractive and included coins as incentive to give Needed to differentiate PCRM from competitors PCRM donors have historically been averse to premiums “No Nickel” strategy played up how PCRM is different: Some groups will glue a nickel to their letters to get your attention. At PCRM, we’d rather USE that nickel to save a dog like Queenie…
  16. 16. “No Coin” Test
  17. 17. 1.64% response – 60% higher than the control! 73% increase in gross revenue! THE RESULTS:
  18. 18. Response began to wane after a few campaigns Aggressive package testing was needed… But That’s Not The End of The Story…
  19. 19. Incorporates proven successful elements: – Emotional letter – Photos on OE and in letter – Three petitions The “Animals Have Feelings Too” Package
  20. 20. “Feelings” package beat the control but not as dramatically as the coin package Package costs relatively high So, we tweak tested to improve response and lower cost THE RESULTS:
  21. 21. Market responsive to “urgent” campaigns Campaign created around Alcohol Testing Lower costs drive lower investment per new donor “Campaign” offers urgency … package format allows for new content as needed And … We Continued to Package Test
  22. 22. The Urgent Package Test
  23. 23. Check out your competition Know your prospects Make sure your package stands apart
  24. 24. Case Study #2
  25. 25. The Marine Corps Heritage Foundation preserves and promotes the history, traditions and culture of the United States Marine Corps, notably through the National Museum of the Marine Corps, which opened in Quantico VA in 2006.
  26. 26. MCHF Development Program Campaign to build the National Museum of the Marine Corps was launched in 2000 70,000 active donors Multi-channel campaign includes: – direct mail – online marketing – telemarketing – events, personal solicitation and planned giving
  27. 27. Acquisition launched in 2000 at net profit By Museum Opening in 2006, acquisition was at break-even Today, acquisition gets .8% response with $32 gift – at 50% cost recovery Post-opening, case for support shifted to maintaining Museum – a tougher sell Starting in 2012, message shifted to expanding the Museum to tell the story of today’s Marines Goal is to complete the Museum by 2017 MCHF Acquisition
  28. 28. MCHF label control package has been hard to beat Tweak tests have evolved package over time – adding elements to maintain strong response Difficult to make non-premium package work in this market Markets include: military, history, subscription and catalog MCHF has access to a few lists of Marine organizations not on commercial market MCHF Acquisition
  29. 29. What We Were Up Against…
  30. 30. Military history interest Museums Veteran related organizations Catalogs and publications Memorial groups Political lists Models MCHF Markets
  31. 31. First Test Package (2000) No Premium
  32. 32. Winner: $35 TEST: Initial Ask – $35 vs $50 The $35 ask lifted the response rate 36% The gift was $53 - lower than with the $50 ask line ($67), but still quite high Many more new donors with the $35 ask line
  33. 33. Decal boosted response 58% Gift dropped just 6% Significantly more new donors Boost in response more than offsets additional cost of decal TEST: Adding a “Semper Fi” Decal Winner: Decal
  34. 34. Labels boosted response 51% Gift dropped 25% Still, significantly more new donors And still at a positive net per new donor ($8.55 with labels vs $10.31 with control) TEST: Adding Name and Address Labels Winner: Labels
  35. 35. Screened Marine Corps image on OE boosts response Revenue up 13% TEST: Adding a USMC Image on OE Winner: Image
  36. 36. Post-opening, needed extra incentive for donors to join Discount offer increased response 28% Gift only declined 14% Discount lowered the cost to acquire by 35% TEST: Discount Membership Rate ($25 v $35) Winner: Discount
  37. 37. Photo cards lifted response 18% Reduced CTA by 9% Helps illustrate need to expand Museum! TEST: Adding Photo Cards Winner: Photo Cards
  38. 38. Lifted response 12% Lifted gift 22% Reduced CTA 58% TEST: Adding New Images to Labels
  39. 39. It’s not like we aren’t TRYING to beat the labels…
  40. 40. Response rate declined 35% Average gift soared 103% Thanks to additional revenue, CTA was comparable RETEST – the gift was still higher, but not as dramatic a lift WINNER: Labels, because they brought in many more donors TEST: Poster Package Poster: LOST!
  41. 41. Response rate declined 30% Average gift increased by 50% Costs for notecard package were higher Despite additional revenue, CTA was 81% higher with notecards WINNER: Labels TEST: Notecard Package Notecards: LOST!
  42. 42. Response rate declined 59% without labels Average gift increased by 57% CTA was comparable, but many fewer donors acquired WINNER: Labels TEST: Member Card Package Member Card: LOST!
  43. 43. Monitor performance over time – If you are retaining new donors well and seeing donor value increase, you can afford to invest more Map out your testing agenda for the year – Craft your plan based on concrete goals: increasing response, gift, retention – Plan should be adjusted throughout the year Never stop testing – even when results are great!
  44. 44. Thank you Lisa Maksa, CFRE | Partner | Lautman Maska Neill & Company with Jennifer Vanderveld and Betsy Wason Evolution Theory — How Market Impacts Acquisition Package Testing www.lautmandc.com | www.PCRM.org | www.marineheritage.org

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