Focus On: Database Analysis: A Closer Look at Models

Modeling for renewal
Organizations that have adopted modeling techniques during these trying times have realized significant gains relative to their peers. As many organizations were mailing deeper to preserve gross revenue at the expense of their net, one of the nation’s premier health-related fundraising organizations was able to cut renewal mail volume 20 percent and increase gross and net revenue 12 percent with the use of predictive modeling. A logistic regression model was developed to predict a donor’s likelihood to respond, and a linear regression model was built to predict gift amount. The two models combined resulted in a score that measures expected value and served as the basis for determining the best targets for renewal.