November/December 2003

The Integrated Approach and the "New Basics" for Successful Member and Donor Development

by Betsy Harman, Founder, Harman Interactive

Email and Web sites are powerful tools for building both revenue and relationships. But how does an organization make the most of these tools and incorporate them with tried-and-true fundraising and marketing techniques?

For the past two years, I've managed a project called "The New Basics," in which a group of public radio stations, with funding from the Corporation for Public Broadcasting, are learning collaboratively and testing various techniques to answer these questions. These stations have learned a great deal and significantly increased online revenue. Online marketing is a "new basic" that should be incorporated into the overall membership development annual plan. Here are a few lessons and tips:

1.) Take an integrated approach
There are two types of integration and both are key to an organization's success. The first type of integration is between offline and online fundraising/email databases. This enables an organization to utilize the same personalized giving ladders and upgrade strategies in email appeals as those used in direct mail appeals. It also enables more effective segmentation and targeting of donors by interests in both online and offline appeals. (Effective targeting increases response rates -- see tip #2.) Most importantly, data integration ensures that an organization is utilizing email to enhance -- rather than damage -- constituent relationships. Email is a very personal medium and people think of it as a one-to-one communication. Sending an email to a major donor that says "Are you a member?" won't make a positive impression.

The second type of integration is campaign integration. Email marketing and online fundraising techniques are most effective when used with other tools, and offering more response channels increases the chance of responses. Following are some campaign integration ideas:

• Include the organization's URLs in all direct mail appeals and print publications.
  
  
• Actively promote the security and convenience of online giving through all online and offline channels.
  
  
• Consider using the "email sandwich" approach -- where email serves as a prelude and/or follow-up to direct mail in much the same way that organizations have been using direct mail and telemarketing appeals together for years.
  
  
• Consider using a renewal series that uses both email and direct mail -- alternating email, direct mail, email, direct mail.
  
  
• Collect or update email addresses on direct mail response forms to sustain communications and engagement of constituents inexpensively all year long.
  
  
• Take advantage of the immediacy and urgency of email. Send an email appeal that says something like: "We've written to you several times, but we haven't heard from you yet. Your membership will expire at the end of the day unless you click here to renew." Or, "Our fiscal year ends in just a few days, please mail your check today in the envelope we sent to you, or click here to donate securely online."

By taking an integrated approach, Chicago Public Radio (a New Basics station and Convio client) raised nearly 20 percent of its overall membership revenue online last year.

2.) Develop a dialogue and go beyond basic personalization
Think of email as a tool for building a one-to-one relationship. Speak in an engaging voice in emails, and send email from a real person, not an anonymous entity. Encourage feedback and make it easy to reply. If a member has a problem (for example, he did not receive a promised member benefit), an organization needs to know about the problem and resolve it promptly to keep the relationship strong. Otherwise, a supporter might get turned off and decide against giving in the future.

Personalizing email means doing more than just opening with "Dear Betsy." It means learning more about donors' and members' interests and sending relevant email. Click-through and open rates are higher for email tailored to constituents' interests. This type of personalization and segmentation is relatively easy using tools like Convio.

3.) When reviewing results, look beyond your online revenue statistics
When measuring return-on-investment for online initiatives, looking at the dollars raised with an online form only provides part of the picture.

• Email newsletters seem to positively impact retention rates. We looked at first-year membership retention rates among members who were receiving an email newsletter from their public radio station versus those who were not. Retention rates were 14-21 percent higher for members receiving e-newsletters. We believe it is due to the increase in touch-points. Supporters who give to an organization and then hardly hear from it until it is time to give again are likely to be less loyal than if the organization regularly provides updates on its work and how contributions are spent. Email provides an inexpensive way to keep in close contact with donors and members, allowing an organization to treat every donor as a major donor.
  
  
• Email reminders increase direct mail response. The more response channels provided, the greater the chance of getting a response. We have seen a spike in direct mail results shortly after sending an email reminder. While people are increasingly comfortable with online transactions, some people just prefer to write a check. An email reminder can trigger someone to write that check and mail the direct mail response form that has been sitting on his kitchen counter for weeks.

Guidestar also recently confirmed this phenomenon by publishing the results of a survey which showed that after visiting an organization's Web site, donors are taking action offline as well as online (http://www.guidestar.org/news/features/e_phil_survey.jsp).

Visit http://www.webpledgetools.org/ to see examples and to learn more about harnessing the power of the Internet. While the site is geared to public broadcasters, any organization can benefit from its resources.

About the Author:
Betsy Harman is the founder of Harman Interactive, a fundraising and marketing consulting practice based in Chicago. She specializes in helping organizations develop integrated membership and annual giving strategies. She can be reached at 773-728-4194 or betsyharman@earthlink.net.