Maxing Out Your Fundraising Direct Response Program

Written By Ted Grigg

Here's a question a fundraising organization asked me. "Are we maxing out our direct response program?" (“Maxing“ is not a real word as far as I know, but organizations seem to have adopted it).

This is a question both fundraisers and commercial businesses have asked for years. The answer is complex and there is no simple answer. 

So here is a check off list to help improve fundraising ROI or target universe penetration.

DMCG Results

1. Do you have a handle on the net count of your combined prospect lists?

These are your proven lists that always achieve your ROI when you solicit them. This will tell you how far is up on your new business or new donor acquisition. Without it, you do not know if you have reached your full potential. Universities and colleges already know this because their annual fund potential reflects the size of their alumni list. These counts are more difficult to calculate for more general marketing efforts.

2. Have you historically allocated a significant percentage of your budget for testing lists, offers, products, channels, multichannel integration, creative execution and direct mail formats?

If not, then you have a long way to go to maximize your financial opportunities.

3. Have you tested your internal outbound and inbound telemarketing groups against other external vendors to see if they can beat your internal team's response rates and ROI?

This also applies to outsourcing internal creative work against your internal creative team in your attempt to beat controls. Do not let a false sense of loyalty for internal or external suppliers keep you from growing your donor base.

No one supplier, internal team or creative effort owns your business. All things are challenged to improve results.

4. Is your budgeting process based on something other than ROI?

If it is, then you will never be able maximize your potential.

Investment spending for testing and the ability to rollout successful tests based on results is required to get the best return on your investment.

Marketing is not a fixed expense.

It is variable depending upon the organization's ROI and desire to expand the business for a more reliable income flow.

Marketing will never thrive when budgets are set based on any other criteria than results. You will truly reap what you sow.

Notice that the questions do not ask for lowering cost but rather improving ROI. Lowering cost is a given in this scenario. Fixating on cost cutting without considering the impact on revenue is just bad business and short sighted.

What other questions need an answer before you know that you maximized the potential of your available market?

Ted Grigg

Ted Grigg is a direct response strategist who helps growth-focused companies reduce risk by identifying weak assumptions before they become costly mistakes.

Over the course of his career, Ted has evaluated several hundred million dollars in direct response testing across direct mail, digital, print, television, telephone, and other channels. His work combines direct response strategy, acquisition economics, customer analysis, creative evaluation, offer development, and disciplined testing.

Ted has worked on both the client and agency sides of the business. That experience gives him a practical understanding of the pressures facing executives, marketing teams, agencies, and service providers—and of the problems that arise when activity, media volume, or creative preference replaces a clear economic objective.

His consulting work helps organizations examine such questions as:

  • Are acquisition goals economically realistic?

  • Is the allowable Cost Per Sale supported by customer value?

  • Are targeting, offers, creative, media, and response paths working together?

  • Are tests structured to produce reliable business decisions?

  • Are unproven assumptions being treated as facts?

  • Is the organization measuring sales outcomes rather than convenient proxies?

Ted’s experience includes the development of direct mail and multichannel acquisition programs for insurance, healthcare, financial services, technology, nonprofit, manufacturing, retail, transportation, communications, government, and business-to-business organizations.

For a national direct-to-consumer insurance company, he developed a direct mail format that defeated established controls and helped expand the productive use of compiled prospect lists from less than 10 percent to more than 30 percent of total direct mail circulation within one year. He also planned Medicare lead-generation programs for more than 60 regional and national HMO and PPO organizations, with some programs exceeding sales projections by as much as 60 percent.

Ted founded Wyse Direct, a direct marketing division of Wyse Advertising in Cleveland, where he developed acquisition programs and helped launch a new technology product for Seiko Instruments by generating a predictable flow of qualified sales leads for its national sales organization. As vice president of new business development for the Grizzard Agency, he helped broaden the agency’s strategic capabilities and pursue new commercial and fundraising opportunities.

He is the author of The HMO/PPO Marketing Plan—A Step-by-Step Guide, published by Executive Enterprises, and has written numerous articles and conducted webinars on direct response strategy, testing, creative development, and marketing economics.

Ted earned a Bachelor of Arts degree from Abilene Christian University and completed two years of graduate study at Texas Tech University. He is the founder of DMCG, LLC.

http://www.dmcgresults.com
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