An Introduction to Direct Marketing and Legacy Fundraising

An Introduction to Direct Marketing and Legacy

Fundraising

NICVA Member Event – 7th October 2014

Karen Gallagher Consulting

Introdution


A. It is talking to your supporters so they end up responding with a donation

B. It might not be immediate but it has to happen for it to be direct marketing.

C. 3 Main areas of activity1. Acquisition/Recruitment2. Retention3. Development

What is Direct Marketing?


helps a relationship develop between the supporter and the charity

gives enormous pleasure to the supporter generates an income for the charity For Example:

◦ 100,000 supporters who each give £200 in the time they support a charity = £20 Million

◦ Reduce this down for a local charity and it makes sense

◦ And£200 is a low Lifetime Value for a supporter

Good Direct Marketing….


The supporter will be happy to leave a gift in their will when they die

The average legacy gift nowadays is around £18,000

Huge benefit in getting Direct Marketing right

When it’s really good….


Legacies

Pledgers

Major Donors

Mid Value Donors

Committed Donors

Regular Donors

Donors

Responders

Incidental Donors

Donor Journey


Supporter Acquisition◦ Recruiting new supporters◦ Enquirers, members etc

Supporter Retention◦ Welcome to the cause◦ Keep them interested◦ Inspire and engage them further

Supporter Development ◦ More engaged◦ Increase the commitment of supporters by

increasing or broadening their support

Direct Marketing to Individuals


Supporter Acquisition


Most challenging part of developing an Individuals Giving programme◦ Perceived as a business risk◦ Rarely breaks even in 1st year◦ Viewed as a long term investment

Developing your recruitment strategy◦ Current supporters◦ What do you know about them◦ Male or Female◦ Younger adults, middle-aged or mature

Use this as the basic criteria when choosing audiences for further recruitment

Recruiting New Donors


Cold Direct Mail◦Lifestyle Lists◦Reciprocals◦Rented Lists◦Compiled Lists

Unaddressed Mail◦Door Drops◦Inserts

Recruitment Methods


Take ones ◦Leaflets◦Postcards

Press Ads Telephone Statement Stuffers

Payroll Giving Face to Face Door to Door Electronic

◦Website & Email

◦SMS Product

Despatches


Recruitment Methods

Ticket Media Social Media Events TV Radio

Foundations for developing a direct marketing programme◦ Can be simple and inexpensive◦ Spreadsheet holding names,

addresses and gift history◦ Be-spoke tailored to meet

organisational needs Raiser’s Edge Alms Donor Strategy Thank You Microsoft Dynamics


Storing Data

Supporter Retention


A focus on donor retention will raise lots of money

Everyone knows that it’s a lot more expensive to acquire a new donor than to retain an existing donor


Retention

Doing everything possible to keep a donor interested in your cause after their first gift

To develop their support you must

◦Inspire

◦Engage them further

◦Welcome them to your cause

◦Thank them for their supportKaren Gallagher Consulting

RetentionRetention is about….

Systems and Processes:◦ Fast & Accurate Gift Set Up

◦ Fantastic Donor Care

As well as being:◦ Thoughtful

◦ friendly

◦ kind to our supporters.

◦ putting ourselves in their shoes

◦ Understand what they want from us

Learn everything you can about your supporters


RetentionRetention is about….

Personally Promptly Creatively Often Is the single most

important tool you have in your fundraising toolbox

Include a BRE

Saying


‘Speed and content of the first Thank You defines the future relationship with your donor’

Giles Pegram CBE

Supporter Development


Is fundamental in enabling charities to differentiate themselves

You need to provide a ◦ high quality and efficient service to develop

loyalty and ◦ increase overall lifetime value

Simply – maintain a meaningful dialogue Reassure them that they have

◦ done the right thing supporting your cause, your charity

◦ and that they have made a positive impact

Developing Relationships


Welcome Pack

• Thank them for the gift• Provide more information about

your organistion• Your Vision• Examples of your work• How the cause will benefit

• It should inspire• Other ways to support,

committed gift, legacy, event etc


Reminds donors of benefits of supporting the cause

Informs them of success of projects supported

Helps promote other charity services◦Legacies◦Events◦Volunteering Opportunities

Dispatched 2 – 4 times / year

Newsletters


Special Events◦Seminars◦Talks◦Tours of facilities

Open Days Make donors feel valued Good way to reward higher value donors

Special Invitations


Should aim to increase donor’s level of involvement with your organisation

Should offer regular opportunities to increase their level of involvement

Using your newsletter to cross sell other methods of giving without the donor feeling pressurised

Selecting frequent cash donors to receive a regular giving ask

Exiting Regular Givers could be asked to upgrade


Donor Development Programme

Regular monthly giving through direct debit or standing order – very cost effective

Typical values of between £2 - £10 per month◦ Helps charity to plan (RGs stay for an average 4

years)◦ Saves administration costs◦ Spreads the risk, relying on large number of small

gifts◦ Supports donor recruitment, easier to commit to

lower value ask◦ Helps build a secure and sustainable income base


Committed Giving

Recruiting new supporters straight to Regular Gift◦Face to face ◦Inserts◦Mail◦DRTV

Cash to Committed Gift Conversion◦Telephone, Mail or Email once per year◦Welcome packs or Newsletters


Methods of Committed Giving

Powerful fundraising tool◦ Recruitment◦ Regular Gift Upgrade◦ Cash to RG conversion◦ Lapsed RG Reactivation

Outsourced to professional telephone fundraising agencies (though some charities moving to in house)

Donors should be supporters for at least 1 year

Plan for year 2 of IG programme


Telemarketing

Letters to existing supporters to ask for gifts to support specific projects

Donors recruited through traditional methods respond better

4 x cash appeals per year (seasonal) When building a donor base – important to

get the balance of ◦ Committed givers-who will provide restricted

regular income◦ Cash supporters – who will fund specific project

appeals


Direct Mail

Direct Mail Packs


Key – good copy – great stories

Stories of NEED and how the charity is providing the perfect SOLUTION

‘Your donation can help more people like…’

Client facing staff – don’t like providing stories/case studies – MAKE THEM – explain why

Good Copy


1. Use I and You, especially YOU

2. Use simple English

3. Use short sentences & vary the length (Plenty of white spaces)

4. Use short paragraphs (max 7 lines)

5. Avoid Jargon

Top 10 Tips for Copywriting 1 - 5


6. Make sure it sounds like someone is talking

7. Ask for money not support

8. Make it Urgent – Repeat It, Use the PS (90% recipients read the PS first)

9. Be concise and to the point – but as long as it needs be to convince the reader (Tests have proven long copy outperforms short copy

10. Use emphasis – underline and bold key messages

Top 10 Tips for Copywriting 6 - 10


What it should look like

Karen Gallagher Consulting - 16th March 2013

Do size and shape matter?

Can size and shape break through the noise and achieve “doorstep dominance”?

Problems with unusual formats:◦ Cost◦ Printers◦ Media outlets

Format



Tall

Long


Concern sandwich insert:

triangle folding out to square

Smart use of formats can achieve stand out from the noise

But more complex and costly

Can divert attention from other matters


Formats


Timing

Often rated as 2nd most important consideration after your audienceDepends on the circumstance of each charity

• Is this the right time for this appeal?• How often should we communicate?• When was last communication and

response?• Seasonality is important• Over or under-mailing people

Response Forms

All of the above drive people to make a response at the time of reading Response mechanism is vital –

and should be planned first Easy to read and understand Make forms bigger Make boxes bigger Plenty of room on the forms Easy to complete and donate Provide options–phone, mail, web


Measuring Success


Analysis and Results ROI NET income Short Term• Response Rates• Campaign Break Even• Donations Received

Long Term• Donor Acquisition Cost• Attrition Rates• Lifetime Values• Net Income Potential


Measuring Success

Number mailed Cost per donor mailed Number of donations % Response Rate Cost per response Gross Income Net Income Return on investment

Response Analysis


Other Really Important Stuff


Test Stuff – lots of stuff◦Ask Amounts◦Additions Leaflets Stickers Address Labels Postcards

◦Stamp vs PPI◦Cash vs Direct Debit◦New Pack vs Control (Banker)◦Plain envelopes vs teaser or photo


Testing

Ensure donation option is available on website Email your donors

◦Primer and reminder emails Use video in emails Use Twitter & Facebook to engage

supporters and donors Website front page should reflect the appeal

◦Make sure Donate Now button is obvious


Technology

Legislation

Data Protection◦Permission to hold

3rd party information◦Store Information

correctly◦Check whether you

need to register with the Information Commissioner

◦Check Code of DM Practice

Gift Aid

◦Make the most of tax effective giving

◦Ask for declarations at every opportunity

◦Variable tax copy


Think about the Pack!◦ Size & Weight◦ Can create excessive postage costs and◦ Beware of VAT on postage – work arounds!◦ Ruin a mailing’s ROI◦ Obtain a weight from supplier before production

Avoid mis-prints◦ Send existing print samples◦ Be specific re stock, weight and size etc◦ Quantity-accurate◦ Ask for Paper Samples


Choose your Printer Wisely

Prevent Disastrous Data and Personalisation errors◦Work with clearly defined data fields◦Add For Position Only data field in a non

printing colour◦Request Data dumps for all key fields◦Review data fields◦Request ‘live’ Proofs◦Ensure address block fits window


Check and Double Check

Sign it off Mail It Be conscious of the day it will land Sit back and wait for the response Make sure Donor Care/Supporter Services are briefed and ready to take the calls


Then what?

LEGACY FUNDRAISING


A charitable legacy is a gift to charity made in an individuals will and paid by their executor when they are dead.

What is it?


After providing for your loved ones and once all debts have been cleared, you can leave a share of the remainder of your estate.

‘The residue of my estate to be divided in equal shares between XY charity and AB Charity’

A share of your estate or Residuary gift


This is a gift of a specific amount. ‘I give XY Charity £2,000- for general charitable purposes’.

A cash gift or Pecuniary gift


Any item you leave, such as a house, a piece of jewellery or shares

‘‘I give XY Charity my house (etc) for general charitable purposes’.

A specific gift -


Is a variant of the residuary legacy where the gift only takes place after the death of (most commonly) the legator’s spouse.

A Reversionary Gift


UK Legacy Foresight Research • Legacy Income currently £1.6 Billion• Estimated to be worth £5.3 Bn by mid century

• Legacies account for 12% of sector’s voluntary income

• Set to grow significantly

Legacies and Giving UK


NfP Synergy Research (2014)• 37% of the public have made a will (down slightly from 2006)

• Overwhelming majority of over 65 year olds have made a will

• Last 2 years – an increase in the number of people who have included charities as beneficiaries in their wills

• Timing of ask vital – most important group to target is 45-54s

Legacies and Giving UK


2013 - 1,570 charitable gifts in 510 wills 65% left by women Down from 1,816 charitable gifts in 662

wills in 1997 (59.7% left by women) In 2013 the top 4 causes are as follows:

Dying to Give NI


Cause 2013 1997

Religion 36.88% 53.4%

Health/Saving Lives 25.92% 16.6%

Poverty & Relief of those in need 22.25% 5.8%

Animals 7.83% 4.5%

• Need to demystify legacies – they are simply another way of giving a gift to charities

• Legacy Giving is big gift fundraising• Organisations need to communicate the

legacy message both internally & externally

• Legacies are a normal, effective and appropriate way to support your organisation

Legacy Fundraising


• Need to identify the handful of donors who will provide the bulk of legacy value and treat them in a manner which will motivate them to give their bequest to your organisation• Donors• Staff• Board of Trustees• Volunteers• Beneficiaries• Other Stakeholders

Identify Potential Legators


• Needs to be done in such a way to avoid alienating donors

• Targeting and segmentation are critical in legacy fundraising

• Legacy messages need to be integrated in other communications (but don’t dominate them)

• Language is essential ‘donations in wills’ likely to be better received than ‘gifts in wills’ or ‘legacies’


Legacy Communications

• Develop appropriate case studies which demonstrate how a legacy gift can contribute to the long term impact of your work

• Give legacy pledgers the opportunity to inform you of their intentions to support you in this way

• Post legacy pledge – relationship needs to be managed appropriately – maintaining & deepening the relationship to ensure it is fulfilled


Legacy Communications

• Sign up for Will to Give • Produce legacy giving materials which

promote the benefits of doing so in a simple and accessible way

• Include Legacy messages within donor newsletters etc

• Test a solus legacy appeal• Legacy event or seminar• Offer receipt of legacy information on

donation and supporter reply forms


RetentionTactics

• Educate staff, volunteers, trustees and patrons on legacies and their importance as a source of fundraising income

• Promote legacies to stakeholders, volunteers, staff and trustees

• Make some of these stakeholders advocates to promote legacies

• Ensure administration support exists to deal with legacy queries either internally or externally


RetentionTactics

• Gifts over the inheritance tax threshold (currently £325,000) is taxed at 40%

• Gifts to a registered charity are not taxable• Means loved ones could have tax bill

reduced up to 40% of the amount bequeathed

• Since 6th April 2012 – if a donor leaves 10% of their estate to charity the tax due may be paid at 36%

• For more information go to HMRC website

www.hmrc.gov.ukKaren Gallagher Consulting

RetentionTax Effective Giving

‘I give to Charity A of Address, registered charity number, a share /the whole of my residuary estate/a sum of money/a specific item or property (delete as appropriate) for its general charitable purposes. I direct that the receipt of the Treasurer or duly authorised officers shall be a sufficient discharge for my executors.’


RetentionSuggested wording for ‘Donations in Wills’

Will to Give

• A group of 37+ of NI charities working together to promote charitable gifts in wills

• Wills Notification Service established in 2012 in partnership with Sector Matters (NICVA)

• Aim to provide WTG member charities with advance notice of legacies when probate is granted

• Probate Office forward copies to DSD who send them to Sector Matters

• WTG Members receive notification• £250 & £495 per year• www.willtogive.org


Will to Give – Snapshot April 2014


Number of Gifts 124

No of Residuary Gifts 39 (31%)

No. of Pecuniary Gifts 58 (47%)

No. of Specific Gifts 7 (6%)

Other Gifts 20 (16%)

No. of Gifts to Faith based Organisations

78 (63%)

No. of Gifts to Other Charities 46 (37%)

www.karengallagherconsulting.co.uk07765251098


Thank you for your time!

http://www.karengallagherconsulting.co.uk/

Government & Nonprofit

An Introduction to Direct Marketing and Legacy Fundraising