The Importance of Donor Segmentation, Personalization
When it comes to our communications, we all have good intentions, don’t we? But sometimes, that’s as far as we get. You think to yourself, “We’re going to send out three appeals a year, four newsletters, a weekly e-newsletter, a foundation report letter—oh, and we’re going to get our thank-you letters out within 24 hours!”
And then that thing intervenes. You know, life. We realize that maybe we were too ambitious, too soon.
Your program director lands in the hospital with a health scare. One of your board members comes in with a grant “opportunity” and wants you to drop everything to spend the next few days drafting a proposal. You struggle to get everyone in your organization on the same page, in the here and now. Your attention is sidetracked by bright and shiny new ideas.
You know you aren't communicating with your donors often enough, and you’re probably right. You aren’t using direct mail to its full potential. Identifying your problem is the first step. Figuring out how to solve it, though, ultimately will be an ongoing endeavor. You need to start now.
If your direct-mail frequency is spotty, your relationships with your donors won’t be able to reach their full potential, and, as a result, your fundraising revenue only will be a fraction of what it could be. If you’re communicating with your donors this infrequently, it’s either because you’ve been told, erroneously, that you’ll burn out your donors, or you think that you can’t afford to maintain consistent communication. Know this: Smart fundraisers think long term.
And really, how many planned gifts do you think will come your way by way of email?
Is that all? Is communicating more often the sole answer?
No. In their landmark book, “Keep Your Donors: The Guide to Better Communication and Stronger Relationships,” Tom Ahern and Simon Joyaux note that, “Hidden inside any database are opportunities to raise more money, if only you could dig them out. Segmentation is your pick and shovel.” Indeed. In my second fundraising job, I increased individual giving by 30 percent in one year, without an acquisition budget, through effectively segmenting our tiny database (less than 500 donors and interested parties) into eight different segments.
One of my Simple Development Systems’ members reported on the changes they’re making:
“Segmentation: This is the biggest change for us. We used to send out just one blanket direct mail to everyone on our list. Been giving to us for 20 years? Well, sorry—you get the same letter as the law firm partner who just attended one of our trainings one month ago. Well, this is the year we are stopping that!
We are heavily segmenting our list—so that we actually will be sending out six different variations on our direct-mail letter—which then feeds directly into goal No. 2 above.
If we know that you are interested in legal assistance for children and youth—and that is the fund that you gave to last year—well, we're making sure that the letter you receive this year thanks you very specifically for that gift, reflects that interest and invites you to contribute again this year in order to help kids.”
Pamela Grow is the publisher of The Grow Report, the author of Simple Development Systems and the founder of Simple Development Systems: The Membership Program and Basics & More fundraising fundamentals e-courses. She has been helping small nonprofits raise dramatically more money for over 15 years, and was named one of the 50 Most Influential Fundraisers by Civil Society magazine, and one of the 40 Most Effective Fundraising Consultants by The Michael Chatman Giving Show.