Direct mail is – and always has been – a medium to target list segments and communicate a message from one passionate individual (the signatory – and please make sure you have only one!) to another individual (the reader).
And yet many organizations treat Direct Mail as a “program” rather than a “communication medium”.
THE GOOD NEWS –those organizations are likely (hopefully) employing specialist direct mail staff and agencies – people who understand the medium and how to maximize the return on investment. And there is likely a structured annual direct mail contact strategy in place with a board approved budget to execute the plan.
THE BAD NEWS – all too often, because there is a direct mail budget in place, staff are expected to adhere to a rigid plan and budget. And their success is measured on the wrong metrics – like net revenue for the current Christmas Appeal relative to last year. Even worse … the direct mail team feels forced to jealously protect “their” donors from Major Gift Officers and regional or national staff so that they can keep donors in their own budget silo. Hardly donor-centric! And not the way to maximize overall net revenue to change the world.
SMART FUNDRAISERS AND FINANCE OFFICERS KNOW:
- The Direct Mail contact plan is a framework that Fundraisers are empowered to alter during the year to better integrate with other contact media, to maximize net revenue and/or retention.
- Net revenue is more important than cost/income ratios. It’s the net revenue that supports the mission and makes for a better world.
- It is totally unrealistic to automatically increase net revenue budgets for a Direct Mail Program by X% from one year to the next. There are many influencing factors – including current donor perception of the organization, donor relations, and the extent to which the organization has invested in acquiring new donors in past years. And if the direct mail program team is doing a good job of upgrading donors to higher giving levels, the most profitable donor segments will migrate to the Intermediate Giving or Major Donor Programs.
- Direct Mail is a method of communication and is only one part of a contact strategy that contributes to the donor’s experience of your mission. It should integrate with other methods of communication – like social media, email, phone, visits.
- Direct Mail communication (and the skills of the direct mail team) can be used extremely effectively within other fundraising programs, for example Planned Giving and Major Giving.
- A Direct Mail Program feeds the organization’s Individual Giving Program. So Direct Mail Program metrics should not be evaluated in isolation. And the cost per donor gained (acquisition cost) must be considered relative to the overall life time value of a donor – not just within the Direct Mail or Direct Marketing Program.