The most powerful word in fundraising?
By Jim Hussey, President AH&A

As we embark on a new year, so too have begun the membership/donor renewal efforts for many organizations.

Renewal programs are a series of contacts with the member/donor, asking that individual to renew her support for the organization’s work for another year. Renewal formats should include direct-mail packages, telemarketing calls and e-mail.

For those who are new to the industry, there are two types of membership/donor renewal programs: 

• calendar-based - seeks to renew the annual support of current members/donors at the same time, typically at the end of one calendar year or at the beginning of the next.
• expire-based - seeks to renew based on the anniversary of that individual’s first contribution.

There are pros and cons for each type of system. Expire systems take the donors’ giving habits into better consideration and allow the organization to spread income throughout the year. But expire renewal systems also are much more expensive, for mailings are scattered across the year; as a result the quantities of each mailing often are small - driving up production costs.

Since a calendar-based renewal system typically starts at the beginning of the year, it takes advantage of the most productive time to renew a donor’s support. And since all donors are mailed at once, mail quantities are much higher and production costs are much lower. Calendar-based systems generally are best for small and fledging organizations.

In many ways, renewal solicitations are the easiest to produce. Asking a donor to simply renew her support is one of the most basic forms of fundraising, and it doesn’t take a creative genius to prepare such a package.

Despite the relative simplicity of such efforts, I’m still amazed by how many renewal programs lack some of the basic elements that can achieve the best results.

Stating the obvious
The best example - using the word “renewal.” I often have heard colleagues say that “free” is the most powerful term you can use in marketing. In regards to fundraising, I respectfully disagree. I believe the term “renewal” is the strongest.

Often, the only thing necessary to generate a contribution is some variation of the word “renewal.” Amazingly, I am often surprised to see some renewal packages that do not even use the word on the outside envelope. Check your current renewal series. If any of the packages don’t use this term on the carrier, test it and see if it doesn’t perform better with it than without.

In addition, this word should be used throughout the package. Once I’ve written a renewal letter, I count the number of times I’ve used the word “renewal” or some variation of it within the copy. If it’s less than a dozen, I add more. In addition, make certain that the reply form uses the word liberally. And it doesn’t hurt to even add it to the return envelope, such as a teaser that says, “Expedite ... Membership Renewal Enclosed.”

Testing into frequency
Many organizations also do not include enough solicitations within their renewal series. But how many constitutes “enough” varies among organizations. I have one client that has more than 13 notices within its renewal series, and another with only four. The number of renewal notices in a series should be determined through testing. With a young program, my general rule is that renewal notices should be mailed until the point that diminishing returns fall below the average response rate of appeal packages.

All healthy renewal programs also should include at least one telemarketing effort. If you lack a telemarketing effort in your renewal program, test the inclusion of a call. If you have tested telemarketing and it failed, try another vendor or different placement within your series. Some element of your member/donor file should be responsive to calling.

And increasingly, e-mail is a major part of renewal efforts. Whether you use e-mail to directly solicit renewed support (as you should for any Internet generated supporters) or merely to inform recipients about an upcoming renewal mailing, the use of e-mail should not be ignored.

There’s little we can do about it, so why talk so much about age?
By Jim Hussey

No other donor demographic is more over-discussed and overrated than age.

As fundraisers, we’re obsessed with our donors’ average ages, even though there's little we can do to push this figure up or down.

I wish I had a dime for every time inexperienced or would-be clients blanched when they learned their donors’ average ages, which usually is in the 60s or sometimes even higher. They fear their current donors soon will die off.

Before they panic and begin posting their resumes, I explain to them that charitable giving is dominated by older donors. And as one generation passes on, it's replaced by the next.

Here’s an example I use to demonstrate this trend. I've been affiliated with one organization for almost 18 years, so it provides a good example of how a donor base is affected over time. When I first began work with this group, the average donor’s age was around 66. Today, it’s still in the same ballpark.

In the past 20 years, many of those original donors, maybe even the majority, certainly have died. But they've been replaced by others who've aged and moved into this donor age bracket.

Why are most donors older? Are younger people less committed to charitable causes? Absolutely not. Younger people are just as committed; they just express it in different ways. Older donors typically have more expendable income, while younger philanthropists are more likely to volunteer their services than their cash.

An example of this is Habitat for Humanity, which partners with needy families to build their own homes. The average age of volunteers who work at a building site is less than the average age of typical direct-mail donors who financially support the organization.

But there’s more
Fear of a dying donor base isn’t the only issue of concern to nonprofit organizations. In this age-phobic time when commercial marketers often favor younger consumers, some fundraisers try to exclude older supporters by aiming for younger donor bases.

I hear them say recruitment efforts should be targeted toward younger donors, to help bridge the age gap. In the end, most of these efforts quickly fail for financial reasons. That’s because most such strategies are akin to Apple Computer Inc. spending more of its iPod advertising budget on 80-year-old prospects, since they account for such a small segment of the MP3 player market.

Even if an organization wishes to dramatically reduce its donor base’s average age through aggressive recruitment efforts, it’s difficult to achieve.

In the 1990s, I worked with one organization that had an average donor age in the low 70s. My firm instituted a successful donor-recruitment campaign that brought in more than 1 million new supporters. Our targeting wasn't based on age; we simply targeted every mailing list that could generate an acceptable response.

After such an aggressive effort, in which we pulled in every donor we could find, we lowered the donor base’s average age by only five or six years.

There are exceptions to any rule. Not all donor bases have such high average ages. AIDS organizations usually have a younger donor base. Women’s rights groups often have younger donors. Organizations that have major, short-term successes on the Internet — such as those that raked in a lot of money after Hurricane Katrina — also might demonstrate at least brief downward trends in their donor bases’ average ages.

None of these cases are due to targeted efforts based on age. So why waste breath on the issue?

What do you think?