When planning a
fundraising letter writing campaign, you need to think carefully about the aim of the letters. Is it to attract
donations right now, or is it to obtain donors who will keep giving year after year? The letter you write will
depend on the answer to this question, and one that is worth spending some time addressing.
For more information on fundraising that will
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Fundraising Letters Should Raise Donors, Not Donations, When Mailed to Strangers
willing to spend $1.25 to raise $1? To lose money to make money? You should be. Most donor acquisition mailings
never pay for themselves. They lose money. And rightly so.
letters (letters designed to acquire new donors) should be a vital part of your development program. Current donors
fall away. Some lose interest in your mission. Some lose their jobs. Other leave the country. Some die. You need to
be mailing fundraising letters to people who have never supported your cause in order to replace the donors who
fall away every year through no fault of yours.
But to be
successful at acquiring new donors, you need to ignore one set of numbers and fix your eyes on another. The numbers
to ignore are the costs of getting your first donation. According to James Greenfield, in his excellent book,
Fund Raising (second edition), you can expect to pay anywhere from $1.25 to $1.50 to raise $1 with an
acquisition mailing. That doesn't sound like a wise use of your resources, does it?
acquisition fundraising letters, you need to have your eyes fixed on the lifetime value of your donor, not the
short-term value of their first gift. You need to remind yourself (along with your board members, key volunteers
and inexperienced colleagues) that your goal with acquisition mailings is to acquire friends, not funds.
This is not always very clear to begin with, and I'm sure some fundraisers will
shake their heads in disbelieve at the thought of spending $1.25 if they only bring in $1. However,
if you keep reading, it does make sense, it's just another way of looking at things. ~
you mail a fundraising letter to a list of 10,000 strangers. These are people who have not supported your
organization before but might. Assume that your costs for writing, design, production and postage come to $0.60 a
piece. Your mailing costs are thus $6,000. Lets say you receive a 1 percent response rate. Thats 100 gifts. Further
assume that the average gift is $30 Your income is $30 x 100 donors, namely, $3,000.
loss for the campaign is: $3,000
Are you in
trouble? No. Heres what you tell your executive director. We gained 100 new donors. And up to 80 percent of them
will give again, provided we follow up properly and solicit their gifts in the right way in the future.
Each of these new donors effectively cost you $30 each (your net loss
divided by total new donors). Are you willing to spend $30 today to raise a friend who will likely give your
organization hundreds of dollars in gifts in years to come? You should be, provided you can remember that
your goal with acquisition letters is to raise a donor, not a donation.
go to Stanley Weinstein and his book, The Complete Guide to Fundraising Management (second edition), for his
insight into the economics of donor acquisition.
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practical fundraising | fundraisers