This critique is, often unknowingly, only focused on a particular brand of research – namely poorly conceived studies that rely on direct questions about the “why” and expect real, meaningful answers. The problem – at least for those of us in the field – is that the bad research studies become public and tend to tar us all with the same brush. We’ll continue to try to point out the differences in bad and good design , which lead to bad and good data. (You can find one such post here.)

We came across a great illustration of the kind of response one should expect if using direct questions about why people donate. This is an actual response from an actual donor, we’ll call her Stella, who offered this as an unsolicited comment though one can imagine her giving this same answer in response to a direct question on why she donates.

“I would hate to think that [organization x] wastes money making their donors feel good. Yes, we need enough info to be sure the money’s going to good use but I would stop giving if I thought they were buttering me up or trying to make me emotionally attached in some way. I give to [organization x] because of my objective observation that they are doing an excellent job…we don’t give so that we can feel good.”

Did Stella just lie? No, not really. She just gave an answer that aligns her belief that she is a rationale actor and not swayed by non-rationale ploys to make an emotional connection. This is the answer she would give if directly asked why she gives. It is categorically not the REAL reason. In fact, it is the exact opposite reason. She absolutely wants to feel good and the stronger the emotional bond the more she’ll give. People often have a very difficult time articulating or even knowing why they do certain things that are “irrational” – say for example buying a branded bottle of aspirin that is pharmacologically identical to the generic brand yet costs more. This is considered by some to be irrational. And yet, the branded product likely gives the buyer greater peace of mind, a greater sense of security and safety. Those things, while difficult to measure, have value.

That value adds up and offsets the greater price point.

The point being, giving for emotional reasons and to feel good is actually quite rationale but not easy – and often impossible – to faithfully report.

The market research cynic would stop the post here and write the postscript or eulogy . But, there are plenty of ways with more sophisticated, well crafted studies and methodologies to get at the real “why”, by focusing on asking what people are good at answering and deriving the rest with back-end analysis.

One great example, measuring personality types. The battery of questions used to discern personality type are indirect measures and multifaceted – meaning relying on multiple questions to measure a single construct (a tell tale sign of good design). You won’t see questions asking “are you a really assertive, type A person?” – too direct and too difficult to faithfully answer the question.

The same goes for measuring reasons for giving and the strength of the donor relationship. It can be done and done well but only with good design and analysis. We can also measure the level of emotional connection to an organization and determine what actions an organization takes positively impact that connection. We can’t do this by asking directly but we can do it.

Let’s not blame Stella for her rationale answers and throw the market research baby out with the bath water, let’s just do a better job of asking the questions. We owe it to Stella.

How do coupons deliver sales lift among non-redeemers?  Most probably know or can guess the answer and it is the exact same reason exposure to online ads (forget clicking, NOBODY clicks) provide lift in the corresponding brick and mortar channel – exposure.   Mere exposure creates impressions.  Those impressions,

Here is quick recap of the lift the coupon study authors found:

• *Study had a test and control design.  Former received coupons as the treatment.

• *73% received but did not redeem.  27% redeemed.

•  *The per person spending lift (i.e. spend over and above the control) was $8 for non-redeemers and $12 for redeemers.  (Sidenote: it is well established that coupons result in greater total spend, not less, even factoring in the discount)

• *The non-redeemer group spent $9200 versus $5,208 since former is the larger segment.

What are the implications of this for nonprofit direct marketers?

That the non-responders get exposed thereby increasing, all other things being equal, their chance of responding the next time?  Sure, that is a fair statement but also really misses the point since drawing only this conclusion suggests keeping the current acquisition state of affairs on auto-pilot.  Hell, it maybe even argues for mailing more since there is latent value in the non-responders.

Again, missing the point.  Let’s see what the Harvard Business Review authors conclude for the commercial sector;

“If businesses realized how powerful this increased awareness can be, they would take as much care with coupons as they do with other marketing materials, striving to delight customers, not simply close the deal.”

This is precisely the conclusion non-profit marketers should draw too.  The reality of acquisition mail, as we’ve written before, is that it is treated EXCLUSIVELY as a “close the deal” exercise, often relying on the lowest common denominator, almost always written from the same worn script and without question, sent to the almost the exact same people as your competitive set.

This results in an unbranded, commoditized world where unique claims, differentiation and high relevance are largely absent and the only thing that wins the day is volume; more and more expensive volume on the same tired list with the same message as everybody else.

So, while in theory the impression created with today’s direct mail piece may result in future response, it is likely also true that is creates a generic impression (e.g. for the sector or an issue) that does increase the likelihood of future response but not specific to an organization.

Another shorthand way to interpret this study and its implications – fundraising needs a whole lot more brand in it.  We are not talking about logo or tagline or some internal machination to derive brand attributes that mean and say nothing to the prospect.

We are talking about a truly compelling, differentiated proposition – almost certainly done at a segment level and not some mass market appeal – that can still be emotional and urgent while also building long term brand value and yes, impressions that result in future response to your organization instead of your competitor just because they get into the mailbox next.

What does this mean?  It means the file that is largely comprised of monthly givers (again, think Europe, not US) is more “stable”, less variance in amounts with the US file having more extreme, upper dollar values AND far more smaller dollar values (i.e. lower than the average for the file)

It is almost certainly the case that the monthly giver model is the better alternative if one were to factor in lifetime values and retention rates.  In the newspaper business publishers get an extra six months of subscriber tenure if they secure credit card payment versus check.

Sidebar: Recognize this has NOTHING to do with loyalty of greater commitment to the product or brand, merely the power of what we’d call hassle factor barriers to exist – namely taking the time to cancel.  We make this observation only as a side note suggestion that organizations not mistake “good” behavior in the form of repeat monthly payments on credit card as a marker, necessarily, of attitudinal Commitment.

However, one unintended consequence of the monthly giver model is typically a far lower difference in the percentage difference in giving between High and Low Commitment donors compared to a cash/check revenue model.  We know the average, annual difference in giving between High and Low Commitment donors (those who attitudinally love you or have little or no connection to the organization) the US is 131%.  Let us stipulate, there SHOULD be a difference and a big one.  Your best customers or donors are a small percentage of your file and they give a disproportionate amount of your revenue.  The goal is to maximize this by treating them differently WHILE identifying the next best set of propects to build the relationship with to increase Commitment and in turn, lifetime values.

This difference in value between High and Low Commitment monthly givers (it is a fundraising myth to assume all monthly givers are Committed) is far less.  What does this suggest?  It strongly suggests organizations with a large monthly giving segment are leaving money on the table since that difference SHOULD be there and it is only not there because of structural and procedural decisions – namely a “let it ride” mentality for folks secured by credit card.  It is true that many monthly giving programs implement special appeals in an effort to create more “spread” in the value of the monthly givers segment.  However, that does not appear, on average to maximize the “spread”.

Don’t mistake this as an argument against the monthly giver revenue model.  It is categorically the better alternative to cash/check given the positive impact on retention and the soul crushingly bad retention realities of check giver models.

But, that isn’t the point.  The point here is, can the monthly giver model be EVEN better?

What might be a way to make it better?  In our view, more products to sell.  Anecdotally, many charities in the US are starting to think this way and look for alternative revenue streams from their main one – e.g. a “catalog” charity wanting another “product”, a child sponsorship group creating a single-gift product/strategy.

In the commercial sector traditional product companies (think Apple) have different products meeting different needs but also, different versions/alternatives within a given product type – e.g. ipad versions, ipod versions.  Much of this has to do with wanting to attract a larger swath of consumer with different ability to pay and price sensitivities.

More product, more choice, better chance of matching up with customer or donor need/ability to pay and price sensitivity – this, in a nutshell, is the better revenue model and to be fair, many groups are already on this track.  The trade-off is having to manage all these products and that does have cost but this is really nothing more than a different way to segment the world  – i.e. by donor type and need and then building the business around it.

The lack of brick and mortar storefront is no reason to discount a focus on experiences being served up to donors.  This range of experiences is far more diverse and frankly, similar to the commercial sector than might be obvious at first blush.

We’ll wrap up with a litany of experience examples but first it is probably worth a brief recap on why this latest buzzword has emerged.

There is data and plenty of it suggesting that service level experiences – versus “product” experiences – contribute as much as 50% of the decision to buy again or not.  This means for a company selling tangible product – e.g. mobile phones, computers, cars – the actual thing being purchased is only driving half of the re-purchase decision.  In this context, service level experiences include all manner of direct and indirect experiences with any and all customer facing staff, the in-store experience, the parking experience, the post purchase follow up (if any), the problem resolution experiences, the word of mouth about the product from friends, etc…

To translate this to non-profit requires only a slight shift re-orientation of terms.  In our view, the product is the brand/organization.  The brand is the mission (or should be) and all the “experiences” should either be serving up the brand/mission (e.g. the fundraising appeal) or supporting it (e.g. the call center).

In theory, the strategy/marketing/brand message delivered creatively can be as or more important than donor service level experiences that often occur in the call center, the merchandise fulfillment center, the walk/run event or the mail room.

However, there is data we’ve analyzed to suggest a complete lack of brand differentiation in many sectors.  Having done work in the commercial world and in some very unsexy sectors like domain registrars, it is surprising to see even these commodity based sectors with more well defined brands among their customer set than what we’ve witnessed in many a non-profit sector.

This lack of brand differentiation is, we’d speculate, the result – at least in part – of a highly generic set of strategies/messages/brand/creative delivered to donors and potential donors.  This is certainly not the only reason; many nonprofits are struggling with a clear articulation of mission and brand that is unique and different and therefore, burdening fundraising staff with an impossible task of creating a silk purse from a sow’s ear.

The larger point however is that if one accepts that brand and mission in the non-profit space are only partly responsible for the decision to stay or go then the other “stuff” has to be making up the difference (setting aside the rare, rare case of serious change in circumstance for the donor).

What is the other stuff you ask?

Here is just a sampling of the range of “boring” service areas that are ignored at your peril when it comes to donor retention and value.

• Donor Service centers (inbound calls and email response) – This is far more important than even Tom suggests.  First off, most non-profits actually have a donor service/call center, either in-house or outsourced.  Secondly, the volumes over time – especially when you add up phone PLUS email – are such that a sizeable minority actually experience this part of the organization (by the way, an important sub-point here, is donors don’t consider this a different, separate part of the organization.)

A small smattering of the service level experiences include first call/email resolution or failure, knowledge of agent, friendliness of agent, helpfulness…Again, the volumes in these inbound centers are such that many organizations wind up having large chunks of the donorbase exposed to great, good, or bad experiences.

•  Events.  Walks/runs/galas.  The number of “service level” experiences here are almost too many to count – registration process, ease of donating process, event day parking, event day logistics, event day experiences, post event follow up.  A veritable parade of potential opportunities – or disasters.
•  Premiums.  If a nonprofit gives away or ‘sells’ premiums for upgrade or incentive purposes it is in the merchandise business. This opens the nonprofit up to product quality experiences, selection or variety experiences, delivery experiences, order accuracy experiences, order resolution experiences…
• Advocacy events.  See walk/run/gala opportunities and challenges above.
• In-person fundraising. It’s not all power lunches, breakfasts and tea and crumpets. Don’t forget the follow-up moves to chase down a pledge, the need for accurate gift processing and the acknowledgement/recognition experience to name but a few.

Listing all these out is a worthwhile exercise for any nonprofit. But don’t stop there.  The other “non-service” level experiences like all the fundraising and stewardship “touches” should be included too.

The next task is to determine which of these matter ( (and trust us, they don’t all matter and those that do, don’t matter equally).

You’ll find for yourself that these boring service level dimensions contribute plenty to the donor’s decision to stay or go – as much and in most cases, more than your next appeal or newsletter.

There are basic flaws in the very structure of branding that hurt fundraising. It’s a misapplied discipline from the commercial marketing world that simply doesn’t work in our (read: “nonprofit”) context.

If this sort of view holds in the world of fundraising then it is only because the definition of brand suggested in this statement is so misguided and off-base.

Consider this definition of brand by Al Ries, a branding guru in the commercial sector,

“A brand is a singular idea or concept that you own inside the mind of a prospect.”

What fundraiser responsible for acquisition wouldn’t want this?

Direct marketing fundraisers are correct to point out, as is done in this post by Future Fundraising Now, that branding needs to support fundraising.  The author suggests branding exercises too often “slaughter fundraising results”.   The issue is not what is said in this post but what is not said (ever); namely that the fundraising needs to also support the brand, just as much as brand needs to support fundraising.

We’d wager fundraising has done more to undermine brand than the brand efforts so lambasted by at least some fundraisers have done to undermine fundraising.  In part, our wager is safe because many of the brand efforts rarely go anywhere for the world to see – they sit on a shelf collecting expensive dust.  And if the brand exercise is an internal machination with no connection to donor/constituent perceptions, needs and further triangulated with organization mission and goals then it is a good thing these efforts never see the light of day.

However, branding done wrong (and wrongly criticized) is not really the point.  The larger concern for every non profit is that they do have a brand, whether they spend time and money defining, internalizing and living it or not.  That brand is the singular concept Ries mentions and many times, the biggest failure is actually having too many “singular” concepts floating around in the minds of constituents.  This is where fundraising comes in as a likely contributor and culprit – suggesting a certain idea or concept on one appeal only to have the next communication or appeal be completely or partially disjointed.  This is not only bad branding (and bad marketing) but we know from our work in measuring and building strong donor relationships that step 1 is delivering a reliable, consistent experience.  Fail to do this and fail, period.

The worlds of retail and media are two analogues for what is likely playing out in non-profit too.  The retail direct mail offer, which is mostly about discounting, has created a well documented – see NYT article here – consumer who simply won’t buy unless it is on sale.  This conditioning has happened over time but it is entrenched and it is a massive problem for many retailers whose brand has been subjugated to 2^nd class citizen with price as the only lever that matters. Or more likely, price is brand.  That is works well for Wal-Mart but there can be only one Wal-Mart.

In media – newspaper specifically – the industry successfully conditioned consumers to believe the product, which we used to pay for (in print form), should now be free (online) and further reinforced this by putting direct marketing offers in market that had nothing to do with content, substance or value, just pricing gimmicks.    Both direct marketing efforts have destroyed massive brand equity (which is real, just ask Facebook with still no revenue to speak of but massive brand equity in form of market cap)

We focus on understanding the donor mindset and motivation. From this work and experience we wager that non-profit direct mail has had a similar impact on the complete lack of brand differentiation in, for example, the environmental space.  The brand “bible” that collects dust at each environmental group actually has differentiation articulated inside of it.  The fundraising pieces are however, as a whole, completely interchangeable with no differentiation, going after the same “customer” segment and often selling based on the lowest common denominator of price or a “goodie in the bag”.  This screams commodity in a world where only strong brands prosper.

Fundraising of course isn’t the only thing destroying brands since there are much more fundamental issues going on with many a non-profit.  Consider some of the very large, mile wide, inch deep brands in the non-profit space — you know who they are.  Fundraising could also be a salvation for these groups and others who struggle for a clearly articulated and singular concept in the minds of their prospects since fundraising is the principal way the organization gets defined and “branded” in the market.  Our guess is that no such salvation is occurring at the moment.

The sector must break out of its inductive and deductive mindset.  A mindset that is stuck analyzing the past to produce the future, a formula guaranteed to yield no new ideas, no innovation. And what is worse, if the future is different than the past – and it is – then this approach guarantees failure; not immediate, but nevertheless predictable.

And so in the spirit of doing things differently – to prepare for a future different from the past – we offer up these innovation ideas, not all new to be sure, but certainly not a part of the current method of operation for most non-profits.

1)      Fix the leaky bucket.   The average company has a 60 to 70% chance of selling to an existing customer, a 20 to 40% chance of winning back a lapsed one and only a 5 to 20% chance of acquiring a new one.  The time is now to drastically shift the resources, time and energy to retention.  Any argument against this is massively flawed, both financially and logically.

2)      Recognize acquisition for what it is – lead generation.  Getting a new donor in the door is akin to winning the battle and not the war.  All the metrics are obsessively focused on the battle – e.g. cost to acquire, response rate, average gift – and very few (other than at conferences) deal with the war – e.g. lifetime value, year over year retention rates.  The industry would be far better off if it literally stopped reporting on the battle metrics and only looked at the war ones.

3)      Build donor relationships.  This is the high level answer to retention.  It is not soft and fuzzy.  The commercial sector is way ahead of the non-profit in figuring all this out.  The bottom line?  We know how to define, measure and manage relationship building.

4)      Identify the donor experiences that strengthen the relationship.  A relationship is the sum total of those shared (i.e. delivered and experienced and reciprocated) experiences.  In the non-profit world these include brand, fundraising and donor service experiences.     

5)      Enterprise wide segmentation.  Very few, if any, non profits have enterprise wide segments, groups that are understood and planned against across the whole organization.  These segments differ in their needs, preferences and value.  They require changes to the marketing mix, which includes offer, channel, ask and service in non-profit parlance, to optimize their value.  Doing so will yield enormous and outsized returns and efficiency.

6)      Reorganize around the donor.  Radically so.  Imagine 4 or 5 enterprise wide segments and then staffing around each.  This means a team comprised of all the various functional areas (online, dm, donor service, marketing) charged with driving the size and lifetime value of their donor segment.  Forget departments, these are donor teams.

7)      Collect and act on donor feedback at every touchpoint.  This is common place in the commercial sector.  Think of your personal experience on websites, with hotels or airlines, car dealers, restaurants…All of these sectors routinely solicit feedback post interaction/visit/event. Why doesn’t the non-profit sector do this?  No perceived need?  No perceived upside?  If the International House of Pancakes (IHOP) cares enough (and they do) to solicit customer feedback on the receipt with a simple 800 number and IVR system then shouldn’t we in the non-profit sector be at least as concerned about our donors?

8)      Experiment more. Fail faster.  Think about direct mail testing.  It takes way too long to fail.  And fail is exactly what occurs the vast majority of the time.  Innovation includes risk, risk includes failure.  Failure is more than acceptable if it is done quickly.

9)      Put senior leadership in charge of plotting the new destination, not steering the ship.  Maintaining the current course is fairly easy, at least in the short term.  Consistently high performers are those who plan for change while still successful because they anticipate shifts in demand, needs and preference – not just of the donors but the beneficiaries of the mission.  There are a lot of non-profits in search of reinvention.  Senior leadership of these organizations should focus on better understanding the competition, recognizing when your distinctness is being undercut and recruiting new people relentlessly.  This last piece, recruitment, is typified by Jack Welch who spent half his time recruiting new talent.  Any non-profit CEO come close to this percentage?  You should.

10)   Start treating donor service as profit center, not cost center.   In the commercial sector and among product companies (versus service) roughly half of the reason a customer will stay or go is tied, not to the product directly, but rather, service level attributes.  This means half of your retention battle has nothing to do with the product features and benefits.  This same reality holds in the non-profit sector.  A large part of the reason a donor will stay or go is not mission or message or premium offer, it is how they are treated when they encounter donor services.  The opportunity here is not avoiding bad experiences (that is obvious), the real opportunity is recognizing the service can actually improve the relationship and is a critical touchpoint, one that can help to further monetize the relationship with cross-sell and upsell.  Too few non-profits run their donor services as a profit center and core part of their business.  They should.

There are sophisticated models, used mostly by bigger players in the commercial space ,to answer this question based on the ROI of different channels and medium. These marketing mix models determine, statistically, the sales impact of various marketing activities by using sales revenue (or volume) as the dependent variable and the various marketing efforts/programs as independent variables to determine their relative impact.

The larger, take-away observation is that determining where best to spend the next dollar is answerable with analytics. But we don’t need a sophisticated media mix model to make empirically driven decisions.

Consider this, according to the Customer Service Institute, it costs five times as much to attract a new customer as it does to keep an existing one satisfied.

A study by Marketing Metrics found the average company has a,

• 60-70% probability of selling again to existing customers
• A 20-40% probability of successfully selling to lapsed customers
• But only a 5-20% chance of selling to a prospect.

Despite these statistics and realities of the cost to acquire versus retain, the non- profit sector is overwhelmingly oriented towards acquisition. Why is this? Part of the answer is the incentives and metrics and focus are all geared towards a) new, b) campaign success (vs. LTV) and short-term targets, respectively.

There is also a dearth of innovation and unfortunately, the notion of shifting the next dollar to retain instead of acquire is squarely in the innovators box at the moment.

The other challenge, until now, is a lack of empirical rigor on ROI forecasts –beyond the generic – for retention. In our view, this is answered through relationship building and donor experience using a framework that is as rigorous and defensible as any short term campaign metric – e.g. response rate, avg. gift, cost to acquire.

For more on how to provide this empirical framework to identify donor relationship building by identifying the donor experiences that matter, mapping them against all touchpoints by lifestage, segment and channel and working through the operational change required to execute, check out this deck as an overview.

Now imagine two direct mail pieces, identical in every way except the organization doing the soliciting.  Any preference (as opposed to no preference) must be a function of brand.  This is a true measure of brand value, one that drives choice and preference when all else is essentially equal.  Think about generic brand drugs – pharmacological equivalents to the name brand yet name brand only loses about 30% market share (in year one).  Why?  Power of the brand; not power of the medicine.

Awareness, familiarity, positive feelings toward the brand, a belief that that the brand is unique and that it means something to you (i.e. relevant) are all, in comparison,  soft measures and in some cases, distractions.

That said, the soft measures can be diagnostic.  For example, if we find that the brand does drive preference but it has low awareness and familiarity then more promotion and exposure are in order to drive revenue.  This has nothing to do with brand value or equity, merely exposure – meaning the value is not created by awareness, it is caused by the functional (i.e. product features and benefit) and emotional connections to the brand.

Let’s return to the identical direct mail piece example.  Let’s further assume that in addition to brand being different we also adjust the “ask” price at $20 and $30.  Now we have a 2×2 grid ,

If I show you Brand A vs. B and both at $20 and you select B then I know you prefer B but I don’t know what price premium it provides.  Preference is a big upside benefit of brand but it can and should also deliver pricing power.  If I now show you A vs. B but B is $30 and A is $20 and you choose A I know it is less than $10 of price premium.  By contrast, if you chose B I know it is at least $10 of price premium.

Identifying a specific dollar amount with additional price points, an experimental design to cover all combinations and some interpolation allows us, in a very short and discrete study to assign a financial value to brand.  What is more, the 2 brand scenario can be expanded to include your entire competitive set.

As a second part of the same study we can determine what brand attributes, from a list of current or aspirational attributes really drive that preference.  One thing we know for sure, it won’t be all the brand attributes in your brand “bible” and those that do matter won’t be of equal importance in driving preference.

As a quick recap, measuring brand can be done to determine its financial value in the market relative to the competitive set, determine what attributes truly impact the brand and by extension, choice, and still include the diagnostic measures of awareness and differentiation to trouble shoot weaknesses.

Why do it any other way?

In the grocery space we found our measure of relationship strength – Commitment – was a very strong predictor (much stronger than satisfaction levels) of spend, share of wallet, number of visits and the number of store brand items purchased.

We also identified, from among a myriad of operational and marketing levers, the biggest drivers of this relationship strength. And is often the case, what is as interesting is what is relatively less important; in this case, the FOOD. The explanation for this underscores the danger of focusing only on customer (or donor) satisfaction.  Product quality and its specific dimensions (e.g. freshness, availability,variety) are likely to be considered table stakes attributes – the “entry price” to be in the grocery business.  In the nonprofit space this is akin to efficiency of spend, frequency of contact and readability of materials; none of them materially matter to the strength of the relationship.

There is ample evidence from academic studies showing service quality as the most critical determinant of merchandise quality perception. Think about that statement – customer service is the most important driver of our perception of product quality.  Relating this to the non-profit space, how many organizations treat the customer service operation as a cost center?  Probably the vast majority.  And yet those interactions, those donor experiences, have a huge impact on the relationship and as a result, future giving.  This is without factoring in the ability of inbound call center operations to upsell and crossell and drive substantial return in hard and “soft” dollars, with the latter being increased retention.

The problem with this thinking is that it has led the sector as a whole to a state of dreadful retention rates, negative lifetime values and a general malaise in search of a cure.  Consider the following findings for the United States Olympic Committee (USOC) recently shared at the DMA conference.

(CLICK IMAGE TO SEE LARGER VERSION)

On the left is a graphic with results from our recent Donor Commitment Study showing Donor Commitment Scores for 50 large, well known charities.  These scores allowed for creation of a national index.  On the right are two columns, representing segments of good (USOC Core) and “bad” (USOC Outside Core) donors based on a Merkle lifetime value assessment.

For each universe of behaviorally defined donors – Core and Outside Core – we measured, via a survey, the strength of the donor relationship with USOC; we call this Commitment and it is 100% attitudinally defined.

When we look at the group, within USOC Core, with the highest Donor Commitment Scores – 85 is the average for this subset of High Commitment donors – we see the average gift is $48.21.  This is compared to an average gift of $43.75 for the average Core donor, defined only by past behavior.  This means we identified, using donor attitudes, a subset within Core who is MORE valuable than the overall Core segment.  This subset of High Commitment, Core donors can only be identified using attitudinal data.  On the flip side we also identified a subset of the Core donors we identify as “at-risk” based on their moderate to low Commitment scores.  This group has a weak relationship with USOC despite looking quite attractive from a behavior only standpoint.  (Sidebar: we also identified what USOC can do from a marketing, fundraising and donor service standpoint to impact these lower scores but this post is really about the targeting piece)

Within the USOC Outside Core we did the same analysis and found a subset of High Commitment donors giving $41.68 in average giving who are well worth USOC spend and focus.  In other words, this group belongs in Core despite having lower lifetime values.  Their relationship with USOC warrants treatment more similar to Core, not Outside Core.

At this point in the post many a seasoned direct marketer will be saying, “yea but how do I find these attitudinal segments on my file if we don’t have Donor Commitment Scores for everybody?”  Fair point, though there is a way to pull this off.

It turns out (which is often the case) there are demographic variables that are uniquely descriptive of the High Commitment USOC donors – specifically, household income and level of formal education. These two variables are easily appended to the file by any number of vendors at a low cost.  At which point, USOC can use them as proxy variables to target and select High Commitment donors who look different than Low Commitment on this basis.  Of course this is not a perfect method but still a reasonable approach that will positively impact ROI.