Rent Smarter, Not Harder
Rent Smarter, Not Harder
Oct. 18, 2005
By Abny Santicola, associate editor, FundRaising Success
The first thing nonprofit organizations should do when it comes to renting lists is understand their market definition. So says Todd Baker, vice president of marketing and brand development for Paulsbo, Wash.-based full-service direct-marketing agency Masterworks. Ask yourself: Are you an organization that's involved in health and human services, the arts, or relief and development? After you have a clear picture of your market definition you can begin by looking at the lists that similar organizations in your category rent. If you're just embarking on list rental, Baker advises taking a look at what lists large organizations such as the American Red Cross, CARE or World Vision are renting over and over again.
"Chances are, if they're renting it multiple times that means it's working for them," he says.
When you find a list you'd like to rent, have analyzed it and have a high confidence level in it, in order to minimize your risk, you should test it, Baker says. But test it by mailing to the minimum number of people possible -- no less than 7,000 and no more than 10,000 names. These test mailings should not be done with test packages, Baker adds. Send the control mailing to the new lists so you can determine the quality of the list. And send test packages to tried-and-true lists so you get a clear vision of that package's strengths with your donor base. Sending test packages to new lists will leave you wondering what worked -- the test package or the new list.
While the option of list exchange is alluring because it saves on costs, the down side is that it creates a "churn and burn strategy," Baker says. It's difficult to create loyalty when your donors are getting inundated with appeals from competitors and other nonprofits.
"You know, people only have the capacity to give so much to charity, and so if your list is out there being sold or given away multiple times a year, you're just lowering your chance to build a loyal relationship with that donor," he adds.
This approach to list rental can produce low gift levels and land nonprofits in a constant state of acquisition -- both frustrating and costly.
The key in list rental, Baker says, is not necessarily to rent more lists and mail more people, but to mail smarter.
Todd Baker can be reached via www.masterworks.com.