American Cancer Society's Pioneering Decision: One Year Later

One year ago, I wrote an article that detailed what may be one of the boldest moves by a top brand in the nonprofit industry. In a move that took the industry by surprise, the American Cancer Society (ACS) made the following decisions in late 2012 with immediate action in 2013:

1. Stop all direct mail acquisition to generate new direct mail donors for the organization.
2. Stop all direct mail conversion to offer non-direct mail Society donors (online donors, event-participants/donors, information seekers, etc.) an opportunity to give a direct mail gift.
3. Remove the American Cancer Society direct mail donors from all exchange universes.

As a reminder, the Society mailed 41 million direct mail pieces to cold prospects and non-mail Society donors in its last year of the strategy. As many can imagine, this decision had the industry talking and everyone became a crystal ball reader for what the future would hold for ACS's program and revenue.

One year later, I had the opportunity to sit down with Lin MacMaster, chief revenue and marketing officer; Hilary Noon, vice president, consumer insight and experience; and the brand-new lead for direct marketing, Robbin Wilson, vice president, fundraiser marketing for the American Cancer Society. I had all of the questions you can imagine. What I didn't expect was the answers that I got in return. Like many of you, I wanted to know, "How were things going?" and "What was happening with the direct mail program?" What I got was a glimpse into the mind of MacMaster and her team as well as the very unique plans they have ahead of them.

While I was expecting some "simple" answers, rest assured they are not; they are complex.

The past year

It's been an interesting and exciting year at the Society. The organization has been going through a full discovery process to understand what the it wants going forward and the type of donors that will help drive significant growth and success against the mission. A part of this process was the completion of a full analysis on the life cycle of the direct mail donor conducted by Noon's team.

While in the direct marketing industry we talk about "life cycles" within the program, Noon's team conducted this with the entire organization in mind. Another shift in thinking is around how the "value of a donor" is defined. As a part of this organizational shift in vision, there are metrics being placed around not only "treasure" (giving levels), but around "time" and "talent." The Society is committed to understanding the true value of the individuals who are engaging with the organization, and this is going to be directly aligned with the amount of marketing investment in those individuals.

As mentioned in the original article, MacMaster refers to the future as the development and growth of an "omni-channel, multi-touch program," and while the intent is to be very drastic, ACS is certainly testing into the new vision. Part of the past year has been planning for this "future" relative to structuring the fundraising and marketing teams in a way to maximize integration. As an example, the American Cancer Society has merged revenue, marketing and communications. Furthermore, within that new department it has created an integrated marketing group where all channels will sit under one leader to design and execute a true integrated experience.

What is ahead ...

One of the big questions in the industry is whether the American Cancer Society will return to direct mail acquisition. The answer is not as cut and dry as you would think. One thing is for sure — the American Cancer Society is not going to do a shotgun, single-channel approach anymore. While there will be new donors coming into the organizations this summer, they will be coming through highly retooled channel strategies — and yes, one of those channels is direct mail.

One example of this retooling is new thinking around the "purpose" of a new donor who comes to the Society through direct mail. Previously (and similar to the majority of the nonprofit industry), the purpose of a new direct mail donor was to move into a direct mail renewal/retention program (focused on keeping the donor profitable in the direct mail program) and then ultimately moving that donor into a lead generation program for planned giving.

With the new omni-channel program, "the purpose of a new, direct mail donor now is that the entire value chain will be leveraged," says MacMaster. The Society is still focused on acquiring and engaging, but the key is to retain donors across the entire organization as a priority — not simply to keep them active in one channel or one program. Yes, there are certain audiences who will only be responsive to direct mail, and that is not necessarily a bad thing. Yet, a key metric of success for direct mail acquisition will be the ability to optimize the relationships across a multi-channel process and engagement across multiple areas.

As a reminder, the American Cancer Society is in a unique position to have hundreds of thousands of new donors every year and from a multitude of channels. Once a new donor is introduced to the organization, profiling and analysis will become a critical part of the strategy moving forward. Future engagement and opportunities presented will be customized and filtered based on what ACS knows about the donors and what it believes the best path will be for them. The strategy for engagement and retention will be centered on "what is the next best 'product' for that person," says Noon.

Yes, the folks at ACS are using direct mail to bring in new donors to the organization (like they will use Facebook, search, cancer.org, events, etc.) — but the engagement and retention strategies in place after the first gift are about the other involvement areas of the organization, and direct mail will be used (along with other channels) to deliver those messages. It is critical to understand that this is very different than the traditional approach where the direct mail fundraising program existed to simply generate donors who could be retained through the single channel.

Lin is also quick to point out that the new approach to marketing and fundraising is not only focused on changing this one channel (direct mail): "We are raising the threshold on what we are doing with acquisition for all of our channels," she says.

In 2013, I had the opportunity to speak to her about this new decision on her eighth day on the job at the Society. She made it very clear that all channels (direct mail included) were going to "have to work harder to optimize the marketing plan to drive broader engagement across many areas of the organization." Based on my interview a year later, it seems that she is holding true to this direction and vision.

Some final thoughts ...

While there are no specific metrics available at the time of this update, it would not be a surprise that this decision represented some level of loss in 2013 for ACS. This decision definitely affected direct mail revenue in 2013, and the new donors who were not brought into the organization last year through the mail channel will represent a multi-year, mail donor loss. But, the Society is committed to its new vision and associated strategies, and the goal is to offset that original mail loss through other channels and bring greater revenue to the organization.

If you've read this article and your reaction is, "Wow, their goals are big and that level of change might seem almost impossible," I would agree with you. Let's face it, the industry has been asking for years what the future of direct mail is across the fundraising portfolio, and I can't tell you how many spirited debates I've been in about the definition of integrated marketing, multi-channel, omni-channel, etc. But one thing is for sure — I have been asked a lot if I if I thought direct mail was dying. As I've stated previously in my blog, I have a very clear and strong opinion about this. Organizations that are focused on direct mail as a siloed, stand-alone program are going to experience more and more challenges in the future. But, organizations that are focused on direct mail as a technique to raise funds and are integrating those touches with other channel strategies will see greater success.

However, I am also realistic — it takes a major shift in thinking and leadership to drive big changes in programs that have been around for decades and represent significant percentages in organization revenue. As outlined in the original article a year ago, the Society is going through a significant transformation that is much bigger than just decisions about direct mail. But this is the kind of movement within an organization that creates the opportunity for wholesale change.

In my opinion, there are so many challenges facing today's nonprofits. Is this something that every organization should be taking on today? The answer is, "It depends." There are multiple levels to "integration," and if direct mail is a significant portion of your revenue, you should not tolerate a high level of risk to make sweeping change. However, the movement away from what the American Cancer Society considers a "single-channel approach" is a very important discussion to start. As an industry, we must be where our donors are, and as the donor population ages and shifts, one thing is for sure — they are not ONLY reading your mail.