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Blogs by TJ Hillinger

Taking the Deep Data Dive

tjhillinger webYour data holds the key to taking your direct marketing fundraising program to the next level of success—but you’ve got to go below surface level to see what’s really going on.

Aggregate campaign-level metrics and benchmarks are great ways to measure performance. But for the most robust analysis of membership dynamics, file trends, and return on investment (ROI), Avalon recommends a really deep dive into your data—an Avalon Inquire™ master file analysis.

This thorough data file assessment can help you meet your fundraising goals by providing the most accurate picture of your file today and identifying significant trends that impact program performance.

Each Avalon Inquire™ analysis is customized to the individual needs of the client, but typically includes an overall health-of-the-file assessment, acquisition analysis, house file analysis, channel analysis, multi-channel giving behaviors (mail, phone, online), segmentation analysis, and upgrade analysis.

Beyond these foundational analyses, we’ve added the following views to help our clients learn as much as possible about their donors, members, and prospects:

  • Age overlay view: Compares the organization’s age trend to the national average and illustrates that fact that donors on most files skew older;
 NMAI MFA Slide 2 - Age Append
  • Break-even analysis: Reveals the projected point at which an acquisition join group will break even—when revenue covers the initial cost and subsequent cost to resolicit;

NMAI MFA Slide 3 - Break even analysis

  • Heatmap/geographic overview: Gives organizations a view of donors’ geographic distribution by zip code, illustrating pockets of donor concentration;

NMAI MFA Slide 4 - Heatmap

  • File stabilization view and trajectory: Projects the current trajectory of the file (growth, decline, or stability) and the number of new/reinstated joins needed to keep the file stable—key data to consider when making decisions about acquisition investment;

2016-06-02 Slide 1

  • Membership vs. giving level/discounts: For membership-based nonprofits, this view provides insight into the member value based on giving levels (compared to discounted giving levels); and
  • Enhanced major gift pipeline: These added views quantify the revenue low-dollar/membership donors provide to the major donor program, underscoring the importance of direct marketing as a pipeline to major giving and the impact of direct marketing beyond the program itself.

If you’re not sure where to go from here with your direct marketing program, an Avalon Inquire™ analysis can help you set a course for the future while giving you the statistical back-up to make your case to stakeholders and leadership. We’ve got your back.

The Impact of Election Year Fundraising on Your Program

Election Image - Election Post

With presidential candidates and Super PACs pulling in millions, candidates up and down the ticket sending daily email appeals, and political parties mailing constantly, we wondered: How does nonprofit fundraising fare in election years?

We took a look at our own data to see whether Avalon’s clients are affected by the political funding requests that barrage our donors in election years, as well as at Blackbaud’s recent study, Giving in an Election Year: How Political Giving Impacts Nonprofit Support.

The bottom line: The flood of political fundraising doesn’t hurt nonprofits, and some even benefit from the extra attention to their issues.

Roger Craver makes the point in his recent Agitator post that when your organization’s mission and the presidential campaign themes (e.g., gun control, women’s health, Obamacare, etc.) coincide, your fundraising can get a boost.

“Take advantage of the climate” when the media and the debate are focusing on your issues, writes Craver. “Seize the opportunity to drive up the volumes to bring in a maximum number of donors.”
Here are a few of Blackbaud’s key findings:

Data demonstrated that political giving does affect charitable giving in the following ways:

  • Donors who gave to federal political campaigns in 2012 gave 0.9% more to the charitable organizations studied in 2012 than they had in 2011.
  • Donors who did not give to political campaigns reduced their giving to the charities studied in 2012 by 2.1%.
  • These findings held true across all sub-sectors as well as the demographic segments of age range, household income, and head of household gender.

When we looked at select Avalon client data for 2012, our results were strikingly similar. Of the six client programs we reviewed, all were slightly up in both renewals and appeals in 2012, with the exception of one large advocacy client whose renewal revenue was down slightly from 2011 to 2012.

Dispelling Myths: Major Donors Need to Be Protected from Direct Mail

tjhillinger webHere’s the second in our series on dispelling common myths in the direct marketing fundraising world:

“Major donors need to be protected from direct mail.”

We’ve heard this assertion from board members, senior leadership, existing and new staff…but when we turn to the data to see if it’s true, here is what we find:

  • For many organizations, direct marketing is a pipeline to major giving — but some people find this surprising and do not fully appreciate its importance. The truth is, many major donors come in through direct mail — and increase their giving when organizations continue to contact them through the mail with appropriate, high-touch packages.
  • We also know that including major donors in direct mail campaigns can increase their overall giving. For one organization, major donor prospects who were left in the direct mail stream participated at a rate 40% higher than similar donors who were “protected” from direct mail and instead targeted with personal solicitation.

Dispelling Myths Conference Presentation - slide 17 v2

  • Lower-dollar donor bases are typically a significant source of future major gifts. In the example above, a single gift of $1,000 is considered a major gift. The chart represents all major donors by initial join level and shows that more than 60% of $1,000 givers joined with a gift of under $100.

Dispelling Myths: We Should Just Do This All Online

First up in our series on dispelling direct marketing myths is one I’m sure you’ve heard: We should just do this all online. The Internet makes everything else in our lives easier, so why not fundraising, right? Also known as “direct mail is dead,” this myth has staying power because some organizations have successfully limited direct mail programs. But most cannot produce the revenue they need through online fundraising alone. And if your organization does not fully understand the patterns and trends of your revenue stream, this myth could lead you to make harmful decisions about investing in direct mail.

To dispel the online-only myth, look to your data. Specifically, analyze your direct marketing revenue by channel; by cross-channel donor-level giving; and by new joins by channel. To give you some conclusive ammunition, here’s what our research and experience tell us: 

  • Blackbaud’s 2015 Charitable Giving Report confirms that although online giving was up 9.2% that year, less than 10% of giving was online. Blackbaud also reported in their 50 Fascinating Philanthropy Stats report that 32% of online donors would give offline during 2015.

 

  • Indeed, direct mail remains the dominant channel by far. Reviewing revenue by channel often reveals the significance of direct mail and illustrates the much longer timeline for newer channel growth. 
 Dispelling Myths - Slide 11 ver 2
  • Direct mail donors provide future revenue to other channels. We’ve analyzed the join source of online revenue and clearly demonstrated the impact of direct mail acquisition on all giving channels.

Dispelling Myths - Slide 12 ver 2

  • Direct mail can provide far more new donors than online. When we analyze new joins by channel, we immediately see the significance of direct mail and the quantities of new donors it provides.

Dispelling Myths - Slide 13 ver 2

 

In coming years, online fundraising may overtake the other channels. But for now, direct mail conclusively remains the dominant fundraising channel. If we’re going to raise the funds we need to fulfill our mission, we can’t just do it all online. 

 

Digging Deeper: Avalon’s VitalStats™ All-Client Dashboard

At Avalon, we’re always looking for new ways to give context to our data. Using our own internal benchmarking tool—Avalon’s VitalStats™ All-Client Dashboard—is especially important, because our mix of clients tends to be different than the Target Index. 

All Client Dashboard Slide 4 - ver3So throughout the year, we compare Avalon client fundraising results to industry results as a whole. This gives us a more detailed benchmarking perspective for our clients and makes for a more relevant point of comparison than other public sources. It also helps us identify trends for Avalon clients across the board. For example, Avalon saw positive change in many key performance indicators by the end of 2015, and outperformed the Target index in terms of change in metrics like retention.

Here are some of the main takeaways from our most recent All-Client Dashboard analysis at the end of 2015:

  • We’re showing fewer new joins (either due to softening response rates in acquisition or strategic decisions to scale back on acquisition) but stronger retention.
  • Avalon clients are moving toward smaller, higher-value files. This is borne out by the condensed file sizes and corresponding increases in overall revenue and in revenue per donor.
  • As file counts decrease, donors are giving more gifts per person—a typical trend. Our focus on growing monthly giving programs contributed to this increase.
  • Multi-year and overall retention had declined slightly during 2013 and 2014, but both increased in 2015.
  • First-year retention is around the 30 percent mark—well within the industry range of 20-40 percent.
  • Average member gifts are rising across the board—especially among new joins and first-year donors.

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