Tuesday, August 11, 2015

Quitting Direct Mail Cost Big Fundraiser $30 Million

When it comes to the value of direct mail, sometimes, to coin a song lyric, "you don't know what you've got till it's gone." At least that was the case for the American Cancer Society, which suspended its direct mail acquisition program from January 2013 through June 2014 as part of an organizational consolidation and re-alignment of fundraising strategy. As reported recently by The NonProfit Times magazine, ACS now reveals that, in the first year of suspended mail acquisition, its new donors declined by 11% and new donor revenue dropped by $11.3 million. In addition, the direct mail hiatus impacted renewal programs, planned giving and events, so the charity estimates the mail suspension will end up costing $29.5 million in lost revenue over five years. For every $1 invested in mail acquisition, ACS brings in $7 over the course of three years, explained Catharine Houlihan, ACS director of marketing, in an ACS-led panel discussion of its re-entry into mail at the Direct Marketing Association Nonprofit Federation's New York conference. "We need acquisition to feed the core audience or else the entire program loses profitability through the course of the natural customer cycle," she noted in the article. When ACS successfully re-launched its mail acquisition program in 2014, it was part of an integrated multichannel strategy including digital, e-mail and tele-fundraising--but direct mail remained at the core, raising 80% of direct response revenue. The ACS panel noted that while digital and e-mail channels are attractive because they are less expensive, they also take longer to break even and fill the fundraising funnel. For more, read http://www.thenonprofittimes.com/news-articles/live-from-dma-direct-mail-hiatus-cost-acs-30-million/

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