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Direct Marketing as a Function of Fundraising

Presentation by Kara Lanpher, Laura Gutsche and Jade Pierre for Dr. Kathleen S. Kelly's Principles of Fundraising, University of Florida
by

kara lanpher

on 20 March 2014

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Transcript of Direct Marketing as a Function of Fundraising

Direct Marketing Tactics Today
Tactics

fliers
phone calls
billboards
direct mail
email
television
interactive websites
online ads
text messages
social media
Direct Marketing tactics are...
measurable and trackable
call for a specific action
require a database of current and potential donors
Non-Profit Organizations Prosper from Marketing
Non-Profit Organization:
An organization that doesn't seek profit.
(e.g., charities, churches, schools, etc..)
For-Profit Organization:
An organization that seeks profit.
(e.g., retail stores, restaurants, etc..)
What is direct marketing?
Today direct marketing, or in our case, direct response fundraising is a group of strategically planned tactics that are designed to build relationships with potential donors to elicit a call-to-action which most often results in a donation to a particular organization.
Examples:
Although these tactics may not elicit an immediate response, they are designed to get current and potential donors to think about the organization’s mission and how involved they are willing to get.
The Future of
Direct Marketing
Metrics build relationships with donors
Marketing and Technology go hand in hand
Nonprofits must be transparent and show vulnerability to publics

Personalized Relationship
References

The Chronicle of Philanthropy (n.d.). Direct Marketing. Retrieved March 11, 2014, from http://philanthropy.com/section/Direct-Marketing/280/

Dilworth, D. (2014, October 17). The future of marketing will rely on relationships driven by data. Direct Marketing News. Retrieved from http://www.dmnews.com/the-future-of-marketing-will-rely-on-relationships-driven-by-data/article/264087/

Kelly, K. S. (1998). Effective fund-raising management. Mahwah, N.J: Lawrence Erlbaum Associates.

THE HISTORY OF
DIRECT MARKETING

• The first direct advertisement: 1000 B.C.
Ancient Egyptian advertising for a runaway slave

Aaron Montgomery Ward
1843 - 1913
Considered the inventor of direct mail
Traveling salesman of dry goods
Realized Midwest Americans were being overcharged
Opened first "mail-order" house in 1872
One-page free catalogue:
163 products listed
Pictures of goods
Lower prices
Quality guaranteed
Expansion

Richard Warren Sears
Copied Ward's catalogue
Mailed first catalogue in early 1890s
First only sold watches, then included clothing, silverware etc.
500-page catalogue sent to 300,000 homes
Created the empire Sears is today

The Public Information Model
Purpose: disseminate needs information
Leading figures: Bishop Lawrence, Ivy Ledbetter Lee
Lawrence used techniques like direct mail
"The techniques refined by Lawrence were capable of reaching donor publics spread across the country. Many charitable organizations turned to publicity and direct mail as the mainstay of their fundraising program." - Dr. Kathleen S. Kelly

Lester Wunderman
Father of direct marketing
Copywriter for ad agency
Developed direct mail approach to build more personal connection with clients
In 1967 speech, created the term "direct marketing"
MEASURABLE AND TRACKABLE
Practitioners measure and track investments and returns to determine where resources like time and money should be used
Example: If a direct mailer is sent to 20,000 homes, how many of those recipients actually follow through with the action (donating, visiting website, attending event)?
Real World Example: Michigan Humane Society
Which of the three levels on Kelly's Hierarchy of Fundraising Tactics would direct mail fall under?

Name three direct marketing tactics used by fundraisers today.
Direct Marketing into the 1990s
New direct marketing tool - the Internet
By 1990, computers began to dominate every step of the direct mail process
From program planning to list development to order fulfillment and response tracking
Email became 99 percent cheaper than sending physical mailings
Direct mail expenditures topped $23 billion
300 percent rise since 1980
20 percent of all advertising dollars spent
In 1996, 77 percent of companies used direct mail
In 1998, direct marketing appeals generated $91.5 billion for nonprofits
An Attack on Direct Marketing
Anthrax effects on direct mailers
RESOURCES
Pidgeon, Stephen. "Direct Marketing to Your Supporters." Knowhow Nonprofit. N.p., 26 Nov. 2012. Web. 16 Mar. 2014.

Wolfe, Lahle. "Direct Marketing Basics." About.com Women in Business. N.p., 2014. Web. 17 Mar. 2014.
RESOURCES
Central Mailing Service LTD. (2013, June 29). History of direct mail part one. Retrieved from http://www.centralmailing.co.uk/blog/history-of-direct-mail-part1/

PCS Advantage. (n.d.). Direct marketing. Retrieved from http://www.pcs-advantage.com/direct_marketing.htm

Levy, A. (2011). Lester wunderman, the pioneer of direct marketing. Retrieved from http://www.blogtalkradio.com/alanlevy/2010/03/23/lester-wunderman-the-pioneer-of-direct-marketing

Photo Credit
ASFMS World History
SEARS Archives
Lesterwunderman.com
Mary Bellis
A+E Networks

brochures
personal letters
smart phone apps
magazine ads
door-to-door
videos
*Think about Grunig's Situational Theory of Publics
direct mailers, telephone calls, social media, online ads, outdoor ads, fliers, brochures, text messaging, email, interactive websites
• Advancement through the printing press
Johannes Gutenberg
1440
Began printing revolution
Allowed for quicker output
Put direct marketing on a bigger scale

Direct marketing preceded the U.S. even becoming a country!
• Garden and seed catalogs distributed to colonies before the Revolutionary War
(1916-1919)
Photo credit: spoon.tv
In 2001, in the aftermath of 9/11, anthrax spread through the U.S. postal system
1/3 of all Americans began treating mail with suspicion
Mass mailings dropped 7 percent
Response rates dopped nearly 50 percent
Marketers advised to clearly identify origin of mail
The Future of Direct Marketing
A focus on creating a personalized relationship driven by data, filling the generation gap and working on the charities' appeals.
Filling the
Generation Gap
Retail Giving

All generations donate more at supermarket and retail stores
Retail giving for 30s and 40s
Studies suggest younger generations less prone to donate than older generations

Filling the
Generation Gap
Assessing the Results

Younger generation more prone to donate when social events are involved
Younger generation donate when volunteering
Filling the
Generation Gap
Internet Activism

Social media used as a means to promote the organization
Nonprofits should entice donors to share online information with friends
Filling the
Generation Gap
Work on Charity Appeal
Text Message Giving

Text messaging is a common donation method today
Survey showed that 36 percent of people are willing to donate via text after an emergency
Retain the targeted public with a powerful image
Share the donors' contribution with their peers
Host an athletic marathon
To improve fundraising appeals:

Hint: Paid advertisements and billboards also fall under this category.
What is the goal of direct marketing in the nonprofit sector?

True or False:
Fundraisers are most successful when they focus on only one direct marketing tactic to reach donors.

Which theory discussed in this class would allow for donors to recognize their constraints in the donation process?

Questions?
SPECIFIC CALL-TO-ACTION
Actions may include visiting a website, attending an event, or following an organization on social media
The ultimate call-to-action is to donate
Example: the mailer from the MI Humane Society included a URL specific to the recipient
Your org's goal is to get the donor to act on the org's needs
DATABASE OF DONORS
Direct marketing targets specific donor publics
Mailers, emails, telephone calls, text messages, etc. require a databaseof donors
Housefiles: current/past donors of your org
Prospects: list of potential donors you purchase from an outside organization
Full transcript