Understanding your donors to keep them for life

Presented byAshok Mahapatra

Fundraising Analyst UNICEF India Country Office

SAFRG, Fundraising Master Class

October 30, 2010

agenda• Fundraising steps and channels• Behind a successful campaign?• What is important for a campaign?• Key things to remember before selecting data• Acquisition campaign analysis• What to do with acquired donors• Right approach: segmentation• House campaign analysis• LTV analysis• Pledge?• The ‘pledge giving’ framework• Why pledge (pledge vs One-off)• Things to know about a pledge programme

Simple fundraising Steps

Fundraising CHANNELS• Direct Mail• Telemarketing• Face to face• Telefacing• Digital• Other

Direct Mail

Telemarketing

Face to face

Telefacing

+

Digital

Behind a successful campaign?

Some quality work behind getting “quality lists”

• Target Audience (who to ask?)• Budget (How much can you spend?)• Goal (better 1st year RoI or long term RoI)• From where can I get the list?• Roll out vs test• Size of the list

Target Audience

who to ask?

(How much can you spend?)

Budget

Goal

Short term vs Long term

(better 1st year RoI or long term RoI)

From where can I get the list?

List Owners

List vendors

List brokers

Type of List

Compiled Lists

Proprietary Lists

test vs

roll out

Size of the list

Analyzing acquisition campaign

Cost per Unit Total Cost

Cost per unit = Quantity Mailed

Response Rate (RR%)

Total ResponseResponse Rate % = X 100

Quantity Mailed

Average Donation Size (ADS)

Total Donation Amount ADS =

No of Responses

Cost per Donor

Total costCost per Donor =

No of response

Return on Investment

Total IncomeROI =

Total Cost

What to do with acquired donors?

• Should we ask them to give MORE?• How much to ask?• Should we send the same ask to all donors?

Should we ask them to give MORE?

How much to ask?

Should we send the same ask to all donors?

Right approach

Segmentation of donor database

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Donor Life StagesDonor Life Stages

Prospects

Deeply lapsed Lapsed

1. New

2. Transition

3. Core

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Definitions:Definitions:

Segment your donors

Analyzing house campaign

LTV analysis

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“ The Net Present Value of the income gained from an average new recruit during a given number of years ”“ The Net Present Value of the income gained from an average new recruit during a given number of years ”

What is Lifetime Value?

• LTV is a measure of the long term benefit of a recruited donor

The Lifetime value (LTV) of a donor is defined as:

To convince your board member for investing in fundraising

Why LTV?

One-off or Pledge?

Why LTV?

Evaluate and guide our recruitment programme

Which Channel?

Why LTV?

Understand which media give the most profitable donors over the long term

Income for coming years

Why LTV?

Understand the long term value of our retention programme

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Lifetime Value

LIFETIMEVALUELIFETIMEVALUE

COST TO ACQUIRECOST TO ACQUIRE

HOW MANY YEARS THEY ARE RETAINED

HOW MANY YEARS THEY ARE RETAINED

COST TO RETAIN EACH YEAR

COST TO RETAIN EACH YEAR

HOW MUCH THEY GIVE EACH YEAR

HOW MUCH THEY GIVE EACH YEAR

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Example LTV Calculation

Pledge

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The ‘pledge giving’ framework

Pledge vs

One-off

Things to know about a pledge programme

• Gross IncomeGross Income• ROI (gross income divided by direct “non-ROI (gross income divided by direct “non-

overhead” costsoverhead” costs• Total Number of Active Pledge DonorsTotal Number of Active Pledge Donors• Average Pledge ValueAverage Pledge Value• Pledge Retention Rate (% of pledge donors as of Pledge Retention Rate (% of pledge donors as of

12 months previously who are still active)12 months previously who are still active)• Pledge Fulfillment Rate (average number of Pledge Fulfillment Rate (average number of

months income received)months income received)

Ashokashok.mahapatra@gmail.com