Case Study: The Home for Little Wanderers

Most larger nonprofit organizations have an aggressive major-donor program in place. Once a donor — whether connected with the organization via direct mail, the Internet, special events or other medium — reaches a certain giving level, the major-gifts folks take over and treat him very differently than other, lower-value donors. The contacts are more personal and focus on face-to-face solicitations.

But what of smaller organizations that can’t afford similar approaches? The challenge of securing major gifts is no less vital to them than to their larger counterparts.

In that case, major-donor solicitation through the mail is a terrific opportunity. It can be done, but it does have its challenges.

Here’s how Boston-based The Home for Little Wanderers, one of New England’s largest child-welfare agencies, instituted such a program.

Serving thousands of abused, neglected or at-risk children and their families each year, the organization works to ensure the healthy emotional and social development of children through an integrated system of residential group homes, special-education schools, adoption services, and counseling and advocacy programs.

The Home’s total annual operating budget is around $41 million; of that, only $4 million comes from its fundraising program and, of that, about $1.2 million is from direct mail.

Case in point
The Home relies heavily on major-donor support and was looking for ways to effectively cultivate these donors. Its development team had multiple sources for acquiring major donors and potential donors, including fundraising galas, an annual golf tournament, cultivation events and through its board of directors. Many of these supporters previously had given just one major gift of $1,000 or more, but most were not direct-mail donors. The organization also developed a list of prospects that had been identified as having the capacity and propensity to make gifts of $1,000 or more.

Demographically, this audience differed significantly from The Home’s usual direct-mail donors, who are women over 55 years old. By comparison, its major donors were males with higher incomes.

The Home’s development staffers knew that reaching out to their best donors and top prospects through the mail could be a cost-effective way to raise significant funds for new initiatives or special appeals. They decided to mail to them during the holiday season, including about 900 of the top-ranked donors and prospects in this mailing.

Objectives and challenges
The Home had several objectives for its Major Donor Holiday Campaign:

• Renew donors who had given $1,000 or more in the past.

• Upgrade gifts from existing donors.

• Convert prospects into direct-mail donors.

• Offer a minimum ask of $1,000 to encourage recipients to be as generous as possible.

• Create a campaign that was easy to execute and cost-effective to maximize net income.

The key challenges were that many of these donors had little prior giving history and were not direct-mail responsive. Also, asking them to give $1,000 — through the mail — was potentially risky. Would donors feel comfortable giving this way? And what about prospects who had never given at all? How would they respond?

The strategy
The Home created a high-end, branded mailing that looked like it was personally created by and sent from The Home’s president to increase its open and response rates.

An “Office of the President” overbrand on ivory linen, stationery-style paper was used throughout the piece. Every effort was made to avoid “direct mail” graphics, treatments or other clues that would make it look like a mass-produced package.

The outer envelope was closed-faced and used a First Class stamp for postage. A personalized, one-page letter from the president praised donors for their “outstanding generosity” and “extraordinary, heartfelt commitment” to The Home’s children, and asked them to “please consider making a special donation this holiday season.” Each letter was hand-signed to increase the intimacy of the correspondence.

The reply device, on a heavier card stock, was very simple, with no scan lines or other codes. The offer was stated simply, without a headline, and continued in the voice of the president, rather than the donor-voice copy that typically appears on reply slips.

The results
The response was outstanding. In the first year of this campaign, the response rate was more than 26 percent, with an average gift of more than $1,100 and gross revenue of more than $280,000. The cost per dollar raised was an incredible $0.01.

In the second year of the campaign, the response rate increased to more than 35 percent, despite a smaller target audience, with an average gift of more than $1,200 and similar gross revenue levels.

Direct-mail campaigns allow smaller nonprofits to reach out to many more major donors and high-value prospects than is practical by traditional face-to-face methods, at a much lower cost.

Major donors do have different needs and expectations compared to regular donors, and they also might be very different people in terms of age, gender and financial status. But they will support your organization through the mail, if treated appropriately.

A highly personalized, intimate approach will enhance response. Use closed-face envelopes and First Class postage, messaging that references the donor’s special giving level, and other subtle techniques that simulate true, personal correspondence. These are all simple, cost-effective tactics that even the smallest nonprofit organizations can implement in their fundraising programs.

Lynn S. Edmonds is president of L.W. Robbins Associates. She can be reached at ledmonds@lwra.com.