Culture, direct mail, Fundraising, Marketing

It’s All In The Bag

A max-sized lumpy day-glo envelope from Disabled Veterans National Foundation

October comes around, and the non profits are making their first of several strong pitches for another discretionary dollar donation. I find my mailbox full, and refreshingly, with some new twists.

Kudos to the team at St. Joseph’s Indian School who have brought in some new creative to overlay their basic control kit.

St Joe’s gift vouchers go full color.

The Dream Catcher is the most unique gift of all.

As always, the Dream Catcher is a unique keeper. I have several, which make their way to the grandchildren. But the kits also deliver more colorful coupons. We’ll see if they repeat…or does the sterile, sober-looking appeal still trump happy colors?

As yet, St Joseph’s is not twigging to my male gender: I am getting stunningly beautiful foil labels with flowers and butterflies. I can’t use these, not even on my golf clubs.

The Post-It Note goes pointy for more attention.

Another St. Joseph first for me: a pointy Post-It note. It’s a little different, and catches my eye.

Certificates, suitable for framing deliver a message.

Plus, I have received a colorful, feather-imaged gold foil, embossed certificate of appreciation, on laid stock, no less!   Veterans of Foreign Wars sent me a similar recognition.

These certificates really are quite classy, as ‘thank you’s go. I am not going to frame them, but that doesn’t mean that someone somewhere else won’t frame theirs.

VFW targets the CD-player crowd with Christmas carols.

VFW also sent along a CD of Christmas carols! This may seem early to you, but actually is just in the nick of time: our new car no longer has a CD drive, but hey, it’s the thought that counts. I do have a cassette player in the basement, a.k.a., Santa’s Workshop.

Father Flanagan’s Boystown has sent me a Puzzles and Brainteasers booklet. You know, I mean to give it to the kids, but in an idle moment, I look at them too.

Beautifully designed gift bags are the pride of several organizations.

In an additional kit I was also treated to a colorful paper gift bag. These items show up across several charities, and I suspect there is a traveling paper bag sales rep who is shipping bunches of orders back to a printing plant in Shenzhen China.

The tote bag is a premium-with-donation offer from VFW.

Veterans of Foreign Wars has kicked the bag up a notch. They offer a full-sized  tote as a premium with donation.

DVNF throws in the bag and a T-shirt with their request for donation.

At the top of the pile however is Disabled Veterans National Foundation (not to be confused with Disabled American Veterans) which sent the whole bag, and a T-shirt, in a day-glo yellow max-sized envelope.

I am now thinking that there are regular flights for printing sales personnel from U.S. to Shenzhen.

St. Joseph’s vinyl totes are small, but classy.

Truly, the most impressive were printed plastic vinyl tote bags courtesy of St. Joseph’s, that aside from their modest size, sported quality designs.

Lateral Thinking

There is an artful expansion of thinking on applying postage stamps to the reply envelope.   Pasting real postage on a reply envelope is a riveting issue.   Donors shudder to waste the stamps, and I am sure the charity’s accountants aren’t thrilled about giving away postage.

But here’s the thing–you may remember in my book Many Happy Returns, the story of the fundraiser who coaxed the donor to please supply their own stamps. The reply envelope said, “Your stamp will save us money.”  In a manner of speaking, it did. Average dollar gifts rose 6%, but response rate dropped 15%. Go figure!

DAV fronts all of the postage on the reply envelope..50 cents worth.

Anyway, the pioneer in applying the full 49-cents (or so) postage was DAV. They primed the pump, and happily cashed our flood of checks. We Baby Boomer donors can’t see a stamp go to waste.

But now, there are some diversions in the path.

VFW fronts only 5 cents, but appearances count in their favor.

VFW provides 5, one-cent stamps to the postage paid BRE, and the USPS will charge the rest. The modest nickel cost looks like a lot of stamps–but it’s not 50 cents’ worth.  This effectively cuts VFW’s in-the-mail costs by $450 per thousand, while still appearing to offer the more expensive stamps.

St Joes includes a faux return address label with 3-cents postage.

St. Joseph’s sharpens their pencil a little more, and only provides 3 one-cent stamps, but adorns their BRE with a faux return address label in my name.  How can I throw this out?

Boystown decorates their BRE with zero-value greeting stamps, but they look great, regardless.

Not to be outdone, Father Flanagan applies 4 Greeting Stamps of no value whatsoever to their BRE, but they look great!

Who can deny the effort?

To date we have 46 greeting cards in inventory. Production quality is high.

Throughout all of the recent spate of mailings I have received, greeting cards still predominate. I counted 46, all high production quality, and which are now stored in one of those pretty paper gift bags.

We have a bucket of pens, but St Joe’s are the classiest.

As well, I have been issued with numerous writing pens…lots of them, and some very tastefully designed, courtesy of St. Joseph.

And speaking of writing, I have a mountain of note pads, some die-cut, none of which can be discarded.

A pencil case for the pens. A lunch box may be next.

They get used.  And when not, where do they go?  Into a pen and pencil bag, supplied by St. Joseph’s!  Wow, what’s next…a lunchbox?

There is an ongoing debate, stirred up by loyal donors about the exorbitant expense taken in these mailing pieces.  How can a charitable organization spend this much, and then ask for more money?

The fact is, the gift strategy works.  Especially if the gifts are exclusive and high quality.  When they are accompanied by personal, expressive letters, the efforts are rewarded by donors who are sitting on, or searching, for the summit of Maslow’s pyramid: self actualization.

Thanks for reading, and sharing.  If you wish to check on these charitable organizations, you can visit Charity Navigator, or the organization’s websites to see their financial disclosures and especially their direct mail fundraising performance.

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Beans, Trees, Socks, Calculators: All Into The Funnel

DAV has granted me membership to the Commanders Club.

The fundamental logic of customer acquisition mail is like starting my snowblower this morning. Gas up, pull out the choke, prime the cylinder and yank the cord. After a moment’s belch of smoke, I can turn off the choke, and the machine settles into a nice, steady RPM.

In direct mail, the sales funnel is a similar process: first overwhelm your prospect, at some expense, then convert them to a repeat with a follow up, and then funnel them into a steady revenue stream.

So I have kept track of my personal response funnel with a few regulars.

Arbor Day will reforest my yard, many times over.

Arbor Day
They are looking for a conversion. Last time I wrote, I reported to you that I had giddily responded to their acquisition piece, ordering 10 spruce trees, and 2 lilacs, with the hope of getting a year’s supply of coffee beans. Well, the coffee beans got me, but I didn’t get them. However, I did get a follow-up mailing, profusely thanking me for the spruce and lilac order. In this mailing they furnish a colorful mail order tree catalog, a newsletter, member card and a free red maple tree with my order.
The tree is 3-4 feet high.
I haven’t the heart to explain I have 17 trees on the lot now. I am still wondering where to put the spruces and lilacs.

Paralyzed Vets sees me bagging my groceries at attention.

Paralyzed Veterans of America
This should be a win back. I haven’t responded to them in the last few years, so they are gracing me with a patriotic tote bag. Actually, they have forgotten who I am, or was, and are introducing themselves. This is a gap in their database. The tote is enclosed, shrink-wrapped.

American Legion’s zip strip. A lesson here: it tears best when with, not across the grain of the paper envelope.

American Legion
This is a win back, delivered as a questionnaire. It comes in a large orange flat, 10″ x 13″, opens with a ‘zip strip’ and presents a set of rhetorical opinion questions which are, as designed, hard to say ‘no’ to. I haven’t given to the Legion in a couple of years. The labels they offer as a freemium unfortunately misspell my name.

A modest, business-like presentation from the VFW. The solar calculator works to 7 decimal places.

Veterans of Foreign Wars
This is a conversion kit, and I am flattered that they have already made me a Gold Circle member. I don’t think I quite deserve that. However, they do, and have sent me a 12″ x 14-1/2″ flat containing a monogrammed desktop calculator, pen and notepad. The calculator works, and my traditional test is ‘PI‘, 22/7 = 3.1428571 which goes to the 7th decimal place. With PI, that’s far enough. They optimistically ask our mailman to deliver to our front door. Good luck with that!

DVNA equips my office with everything but a lawyer.

Disabled Veterans National Foundation
This 12″ x 14-1/2″ faux kraft flat is like a postal trunk sale. It is an acquisition piece. Inside I get the motherlode: a pocket calculator in its own wallet–goes to the 7th decimal place– two pens, a monogrammed 15 month calendar, with silver-edged pages, three greeting cards and envelopes, and a check made out to me drawn on the Bank of America for $2.50. I am verklempt.

DAV’s renewal kit bespeaks lower cost. They have me now.

Disabled American Veterans
This is a renewal notice to the DAV’s Commanders Club. A kraft #9 stuffed with a member card, a small note pad, some tastefully designed stickers, a prayer card, and a certificate stating I am an Illinois Silver member. The preferred ‘ask’ is $50. This kit is confidently on cruise control.

Father Flanagan’s “Acknowledgement”: I envision Spencer Tracy suggesting I try a little harder.

Father Flanagan’s Boys Home “Boystown”
This 8-1/2″ x 12″ kit is as thick as a breadboard. It is not an acquisition piece, because I am a repeat donor, so I put it up to their attempts to get a bigger gift from me, like $60. They send along a wall calendar of the cosiest Sam Trimm bird paintings I have ever witnessed, plus a 30-page puzzle book–21 games, answers on the back page–, a pocket calendar, a one-page, at-a-glance calendar, a 16-page daily planner, a Certificate of Acknowledgement–which I don’t want to over analyze, but I think it really means ‘you can do better’– a second 2018 calendar, with a personalized street sign, two sheets of address stickers, and of course, a letter displaying some gift certificates worth $60 that I should fund.

My Aunt Betty would have liked these.

Father Flanagan..Again
I did not respond quickly enough to the kit above, so Father Flanagan sent me a 6 x 9 reminder stuffed with blank greeting cards. I should point out to the folks at Boystown that these cards are pretty close to what my sadly belated great aunt would have mailed upon occasion, rest her soul. They have hearts, flowers, birds, and butterflies. Again, I should not over-think this, but it’s possible Father F believes I am my aunt.

Lakota designed hosiery. We all need socks.

St Joseph’s Indian School
I have difficulty thinking I am not a “renewal” with these folks. But darn it, they are still working me up with a shiny, red-foiled, hard sell on a ‘triple-up’ mailing. An anonymous benefactor will triple my gift. They would like $25 which will balloon to $75. While this is reminiscent of the stock market, up until last Monday, I am even more impressed by the very snazzy pair of socks which they have included for me. Many may have lost their shirt on the Dow Jones this week, but by golly, I have my socks.

I have to return to snow blowing.  My feet are warm.

Thanks for reading!  If you are interested in these organizations, especially their financial efficiency and clarity, you can check them out at Charity Navigator, Give.org or at their website:

Arbor Day, The American Legion, Disabled American Veterans, Veterans of Foreign wars, Disabled Veterans National Foundation, Father Flanagan’s, St. Joseph’s Indian School.

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Battles In The Mailbox

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The Memorial Day rush begins.

There is an ongoing, armed conquest being waged in our mailbox.

Whether it was my donation to a certain political party that flagged my name, or perhaps a popular consumer magazine subscription, the ensuing barrage of fundraising mail from veterans’ associations is non-stop in our mailbox.

Regardless, the creative pitches are stunners, and deserve a closer look.  You are hereby invited to read my mail!

Most of these charities are profiled and rated on Charity Navigator.org, which strips away the emotion to detail actual performance against their stated missions.

Turnkey Office 

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As big as a door mat, and packed, too.

The Disabled Veterans National Foundation takes overwhelming force to a new level with their glossy, Flat-sized embossed package.  Despite the red-stenciled “DO NOT FOLD” our faithful USPS carrier did just that to get it in the mailbox.   It measures 12 x 15, and according to the weigh scales at our grocer’s fish counter, weighs 13.4 ounces.  If that seems heavy to you, perhaps we have been paying too much for our halibut.

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The field ready office with solar powered personalized calculator and stationery.

Inside this doormat-sized kit is a desk pad, calculator, calendar book and ball point pen.  Along with this prefab office kit is a $2.50 check drawn on a Bank of America account.   Surely a mistake, it is signed, dated and made out to me.   In the enclosed letter, the writer, smitten with remorse, asks me to return the check.

Check mailings are iffy because in many cases the marketer needs to have funds held in escrow to honor the checks if, fates forbid, the recipients decide to take the money.

Disabled Vets FNDN182

“Made in China”–The disturbing bug that must be shown.

This kit ain’t cheap.   Postage alone is nearly a dollar, and considering the hand-applied “Philip Brown” label on the calculator, plus its die-cut and tensor-ribboned place mat, the overall cost has to be at least $4-$5 dollars each.

Which may explain why the kit was made in China– not an encouraging signal for U.S Veterans.  I wait to see if they will send me a typewriter next year.

Parade-Ready Flag

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Steel plate reveal: your own desk ready Stars & Stripes.

Wounded Warrior Project also approached us with a package, a 5 x 10 windowed boxlet   displaying a real flag inside.  This Army-green imitation steel-plated ammo box is nearly half an inch thick, so it’s non-automation all the way..40-45 cents to mail.   The flag is intricately folded into a die-cut foam holder that also holds the addressed donor form, a hand-assembled product for sure… which explains again, why it was made in China.   In the mail, $1-$1.50 each.

We’ll talk about cost/response in a minute.

Photo Wallet

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A photo wallet… a hard to discard gift.

Wounded Warrior Project also sent along a separate request which included a 4×6, 20-page photo wallet.   Inside a regular 6 x 9 envelope, this gift actually made immediate sense, and the wallet now holds images of our ridiculously  brilliant, and beautiful grandchildren.  Not being one to take anything for granted, we will reward WWP for the effort.  Still, with postage, in-the-mail cost is 40-50 cents each.

Calling Cards

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Ersatz calling cards stuck in place to get the letter opened.

Help Our Wounded, and Armed Forces Aid Campaign have learned how to affix 3 plastic phone cards to a page.   Technologically, this is pretty cool, if not done by hand.  The cards are stuck on top of each other and appear jumbled through the large glassine window….as if they were thrown in quickly, sealed and run off to catch the 3 o’clock mail.  The impact, especially for the uninitiated such as me, is strong.   Their job is to get the envelope opened, and indeed, the ploy works.   Help Our Wounded, aka Healing American Heroes is not found on Charity Navigator.   My bet is the mailing costs 50-60 cents all-in.

Going For Our Stronger Feminine Side

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A pretty package with writing in mind. This one’s for Gramma.

Disabled American Veterans is the senior classman in veteran’s charities.  Despite that, they have assigned a female status to my record, so I receive kits that reflect more genteel tastes than one might expect.   Putting the gender bias aside, especially in North Carolina, this kit is in keeping with DAV’s efforts to send along quality gifts.

I can’t use any of this one, which is resplendent in lavender-hued Forget Me Nots.   Still, if I was desperate, making a struggling attempt to write to my passed on mother, or to scratch out a hasty last will and testament, I have notepad, and mauve colored, simulated vellum sheets for assigning my debts to chosen in-laws.

The kit is tasteful, if gender specific, and is certainly an eye opener.   DAV also uses real stamps on the reply envelope.  While the accountants may come unhinged at this largesse, DAV’s frequent use of the costly stamps is proof that the presumptuous gesture works in bringing in more donations.

One wonders how many codgers will steam off the stamps, versus cross out DAV’s return address and use the envelope to pay their water bill instead.

All in, this piece must tip the scales at $2.00 in the mail.  But it works.

Subtle and Cautious

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Creative use of stamps–just enough to impress, but maybe a challenge for the USPS accountants.

The USO is the most conservative kit to ask us for a donation, and that is in return for a genuine Stars & Stripes Flag plus good feelings.   I included this under-played kit because of their creative use of postage.

Non-profit letters get a privileged postal rate, somewhere between 8-18 cents depending upon address density and automation compatibility.   USO chose to affix 5-cents worth of stamps to their outer envelope, and to use their postmark (#440) to make up the difference at the counter.

Their reply envelope reveals their cautionary approach to wasting postage money.  Rather than place the full 49 cents on the envelope, like DAV, they are willing to go for 5 cents, but left the Business Reply Mail (bill us) indicia in the corner.

We guess that this itsy-bitsy effort will drive the postal accountants nuts.

In the mail cost: 40 cents, tops.

Drop Another Nickel

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Just when you thought the nickel was yours, they want it back.

Paralyzed Veterans of America is one of several charities which has a conveyor belt from the US Mint to their mail room wherein millions of shiny new nickels are deposited on glossy label stock letters.

Just yesterday we discussed at lunch how many of us keep the nickel, which after all, adds up when everyone is mailing them, March Of Dimes excluded.

PVA’s piece is a max-sized letter, 5 x 11-1/2.   This is a smart move because the postage is the same large or small, so you might as well get the most paper into the package that you can for the same price.  However, nickel-enhanced gold foil labels are heavy, so the rule is to keep below 3.3 ounces or the rate goes through the roof.   $1.25-$1.50 in the mail.

Did You Get Our Card?

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Flowers, fuzzy puppies and kind sentiments… a happy birthday for some one.

The Veterans of Foreign Wars by comparison uses a tiny 3-3/4 x 7-1/2 envelope, aka a “Monarch” to ask the nagging question, “Did your special edition birthday cards arrive?”   Somewhat reminiscent of the neighbor’s kid who knocks on our door to sell Christmas wrap.  We still have six rolls from last year.

Well, yes, the cards did arrive.   I am sorry, but so far I have not found a suitable target for them which are best described as lovely and softly sweet.   My Mom might have liked one, but not from me.   Again, these are estrogen-energized, and if I get my hands on the person who tagged me as female, I am going to scratch their eyes out.

A simple little kit, probably 40-cents in the mail, at most.

How Do They Make Any Money?

As you can see, these kits range in cost from 40 cents to perhaps $5 each all-in.   Can a non-profit actually make a profit from these mailings?  Check the Charity Navigator for details. You will be enlightened.

But realistically, the acquisition of a brand new donor will always be at a loss.  The strategy is to keep that donor giving for a long time afterwards, hopefully with a final bequest of planned gift when they pass on.

accountant

“How the @#$%^%$$ will we ever make this work?”

For the accountancy gene in you however, rest assured that every fundraiser has a donor acquisition cost they won’t exceed.   This is the anchor point in a campaign.  To respect that restriction, a good forecast on the cost of a response is to divide the piece-cost by the expected response rate.

For instance, a piece costs $2.00 in the mail.  This is big money, and the accountants are squirming in their chairs.  But the marketing folks believe the kit will get a 7% response.

$2.00/7% = $28.57 cost per response.

If the charity can show that a new donor at that cost will stick around on average for 5  years and return $150.00 in donations, then that is a reasonable investment.

Meantime…

We are digging in for more incoming mail.   Hopefully without flowers.

Thanks for reading!   We do support our Vets and and respect all that they do.  If you are inclined to donate to a cause, check out their website for a financial report, or visit  Charity Navigator.

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Your First Impression Won’t Be Your Last

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St. Joseph’s Indian School delivers the piece de resistance.

You know it’s Fall when the big fundraising kits stuff your mailbox. This year we have a surfeit of gifts from direct mail fundraisers.

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Father Flanagan’s Boystown stickers for identifying anything that moves.

Years ago the pioneers in the business presented us with address stickers.

These we have dutifully paid for and have now labeled every moveable item in our home: CDs, iPads, iPods, iPhones, chargers, golf clubs, cassettes, Walkmen, books, staplers, rulers, vinyl… luckily we don’t own a pet.

The ante was raised by the March Of Dimes who gratuitously presented us with a small monthly stipend of ten cents: a shiny new dime pasted to a donor form.

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Food For The Poor’s coins… how can you just pocket them?

That munificence has been outpaced by Food For The Poor who made change for the dime, and sends us a penny and a shiny new Jefferson nickel. That’s a 40% cutback, but insertion is more costly, so it’s a wash.

Not to be outdone, Disabled American Vets provides a 9×12 calendar, which we can place beside the 10×20 calendar from Boys Town.

Of course, wall calendars are bulky, so we are grateful to St. Joseph’s Indian School which gave us a 4×6 calendar booklet for the purse. I am waiting for the 3×5 that fits in my shirt pocket.

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There’s no excuse for not writing….here’s a VFW pen.

The mailing industry is of a generous culture though. With all these other possessions, we have also received dozens of greeting cards: whole writing kits, with pens, to reach out and greet someone– anyone.

Oblate Missions has sent us so many Christmas cards it may be easier if we send them our Christmas mailing list instead.

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Catholic Relief Services’ prayer medallions.

You can’t blame an organization which does its part in reinforcing the goodwill that blossoms from receiving a greeting card in the mail.  I am all for it.

As a sidenote, the USPS post office in Libertyville has a well designed rack of greeting cards for sale.

This one cartoon I loved for its text:

Outer Cover: “Wow! You got a real, honest-to-goodness card! Not a text.  Not an email!”
Inside Caption: “Wow! It has an inside too! It just gets better and better!”

In one of their early bold moves, Disabled American Veterans pasted 45 cents in stamps onto their reply envelopes. Overflowing in confidence that once we saw the postage in place, we would feel obligated to fill the envelope.

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Marines Toys For Tots and Wounded Warriors provide your stamps.

Even gutsier, Wounded Warrior Project and Marine Toys For Tots are paper clipping custom 47-cent stamps to their letters.   This is very expensive, as Stamps.com provides these stamps at a hefty premium.

The strategy works though.  Can one really use the stamp for anything other than a gift without a stab of guilt?

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To avoid being pressed into service, British sailors eyed their brew from the bottom up.

The gifting brings to mind the old conscription practices of the 1700’s when British sailors were pressed into service when they drank from a tankard of ale, only to find the King’s shilling in the bottom.   By unwittingly enjoying the beverage, the sailor had been hired.

I think of that clever ploy as I pile up the loot, especially the coins and stamps.

The mailers know what they are doing. Despite all common sense, they have proven that the unsolicited gift still wrests outlandish response rates and donations. And once you are hooked, they will be back until they end up in your Will.

That’s right. Planned Giving is a part of every established fundraising strategy, and if you asked, many organizations can tell you which of their huge bequests started with a direct mail gift, years before.

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Fleece gloves… probably a postal nightmare, but still handy.

This season’s most impressive packages included one from Kids Wish Network, which sent along a pair of fleece gloves.  They arrived in a lumpy wrinkled paper envelope I am sure that the post office would rate as “baggage class”.

But how do you throw those out?   What tight fisted non-donor could wear them, especially when the writer suggests: “When you use the deluxe fleece gloves I sent you, I hope you you’ll remember Wish Kids like Tabitha…” .

The penultimate delivery however, the cream of the crop, the ne plus ultra, is the bulging envelope from St. Joseph’s Indian School.  No doubt USPS rated this one as “duffel bag class”.  Inside we found the usual and generous complement of address labels, gift stickers, 4×5 note pad, 5×7 note pad, pocket calendar, wall calendar, personalized calendar card, and 3 shrink wrapped greeting cards.

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St. Joe’s mystical Dream Catcher, not to be ignored.

In addition however there was a most unique and unusual item, a genuine facsimile of a Lakota Indian Dream Catcher.

The Dream Catcher is a little hand-made assembly of string net, naugahide, beads and feathers.  Mounted on die-cut foam core, it is shrink wrapped with colorful operating instructions ending with: “to be hung on the tipi or lodge and on a baby’s cradle board”.

I have to admit, I had to dig through pounds of newspapers and old phone bills to retrieve this package from our recycling bin.  There is something especially foreboding about disposing of the St. Joseph’s piece so casually.

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The Marines Toys For Tots medallion, struck with the USMC shield and Semper Fidelis on the other side.

Yes, in the past, I have taken all the coins, scribbled on  lots of notepads, hung countless calendars, and stuck hundreds of stickers without a moment’s guilt, or nearly so, but the Dream Catcher had me netted and nettled.  This one item–which I would never purchase on a dare–clinched the deal.  Just how unlucky could my life turn out if I didn’t give due respect?

So it’s hanging over my DAV Certificate of Merit.

 

Thanks for reading!   I hope you find your charity of choice this season.  These organizations are especially effective, and they mind their pennies too.

 

 

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DAV Makes The Numbers

I just received a mailing from the Disabled American Veterans, whose organization I frequently support.

DAV's Mailing to Past Donors

DAV’s Mailing to Past Donors

The mailing piece is illustrative of the investment DAV makes to raise money for their many services provided to America’s injured war vets.  If you have never received a DAV piece, you have not seen the abundance of gift stuff frequently mailed to potential as well as loyal donors: greeting card sets, bookmarks, calendars, and beautifully crafted address labels.   There’s nothing “junky” about a DAV appeal letter.

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46 cents postage, courtesy of DAV

What struck me about this recent letter was the inclusion of a reply envelope which was already paid with 46-cents of stamps.

Claiming austerity, most fundraisers ask you to provide your own postage.  Instead, DAV pays the bill.   Does it seem contradictory to you?   Or does it make perfect sense?   My guess is that providing the postage is a tactic to increase response, not necessarily the gift amount.   In other words, if a donor normally gives $10, the prepaid return postage tactic doesn’t get more dollars per donor, but it gets more donors: those folks who won’t allow 46 cents to go to waste.  And it’s unlikely many stamps get steamed off.

But here is where it gets interesting: what direct mail manager is willing to put their job on the line by suggesting they add 46 cents to the cost of every fundraising letter they send out the door.   “Are you nuts, or just plain stupid??” suggests their boss, popping TUMS once a minute.

“Riskophilic” may be the proper term.    Daring.  Or canny.  A little bit of math may reveal the truth.

You can look at DAV’s 2012 annual report which shows some numbers worth bragging about.  They earned $97 million in direct mail donations at a cost of $32 million.   Basically, for every dollar spent in direct mail they received 3 dollars in return.   The 3:1 ratio is pretty consistent every year, and by the way, their fundraising cost is only 19% of all their expenses, which is quite acceptable.

Anyway.  The letter I received had 5 Christmas cards and envelopes, a disclosure sheet, a letter, outer envelope and reply envelope.   With outgoing postage, I figure the kit was worth 75 cents in the mail.  $750/m.    Add an additional 46 cents, and you are at $1.21 for one piece of mail.   Multiply that by 100,000 and you have college tuition at Northwestern.

However: increase your cost by 60% and you need to increase revenues by 60%, to keep that 3:1 ratio.   Sounds challenging?   Just about miraculous is how I would define it.   You don’t get swings like that.  But the beauty of direct mail is that you can test it both ways, with and without the extra stamps.   Clearly, the test proved  positive, in a good way, so the DAV is keeping the USPS afloat while making money for its vets.

There’s more at work though.   That crazy manager also has another equation in his or her head.   It answers the question: how much revenue with every piece mailed?   If each piece costs $1.21, then each piece must earn $3.63 in donations.  3:1, right?    But only if DAV gets 100% of the people to respond.   What if only 15% of the people respond?   Then a $3.63 donation won’t cover the ratio.     Now the gift changes, and here’s the revealing equation: $3.63 divided by 15% response.   $3.63/15% = $24.20.   The average donation must be $24.20.

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The “ask” starts at $7.00.

Hmmm.  Look at the donation form on the letter.   DAV is asking for “$7… $10… $15…  or more”.  Whoa!   What if everyone just gives $7 dollars?    Well, again, this is what gets tested, and DAV is pretty confident that a $7 gift is acceptable.   My hunch is that if each gift is at least $7.00, DAV just about breaks even.   How’s that figured? Well, divide the piece cost by 15% response.   $1.21/15% = $8.07 average gift required to break even.  $7.00 is close.

Fortunately, my bet is that people give a lot more.   Without having any direct knowledge of DAV’s results, I can only guess that the scenario is something like what I have described.    And if it is anywhere close, DAV has some very good writers, and some very generous donors.    And some very deserving vets.

A salute to all of them!

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