Geared Up for Growth
4. The fourth is annual value per audience member. … Look at all those folks who were in your program; what was their contribution throughout the year?
The next three are related to investment and return to your org.
5. The first is your annual cost per audience member. So you’re going to add up all of the pieces that you mailed during the year, all of the e-mails that you execute, all of your annual reports and cultivation efforts and all of the things that may not necessarily be revenue-generating, and look at what the cost is per audience member.
6. The next is obviously related to that and would be your annual net per audience member.
7. Lastly, and this is very important as we are all looking so closely at our fundraising efficiency numbers and how those get reported to our donors, is looking at your annual ROI or the flip side of your ROI — your annual cost per dollar raised for donors in this program.
Those seven metrics put together are absolutely a complete snapshot of your midlevel or any high-value donor program. And if you benchmark that now and potentially even look back for the last three years, you’ll know how you can change things in the future and where you need to steer your ship to have the real growth opportunities that you’re looking for.
AM: [An attendee asks], “Some NGOs are quitting the use of direct mail due to cost. What do you think about this? I’d like to know your perspective on the metrics that you just used to help somebody who is in the situation of wondering whether direct mail is still the right channel.”
KM: The metrics that I gave specifically are helpful for midlevel, and your justification for talking to those folks shouldn’t be a very difficult argument. But it’s certainly something you can look at for your overall program, as well. …In order to keep your program going, balancing the investment that you’re going to make in acquisition with the growth, the continued opportunity and hopefully the filling of the pipeline for your major and ultimate gifts is really the way to illustrate a complete picture of the role of direct response.