“Dear Anonymous Stranger”…Segmentation secrets for your nonprofit direct mail appeal

October 1, 2012

While your organization’s appeal letter might read “Dear Friend,” your donor will read it as “Dear Anonymous Stranger.”  

After all, what is more impersonal than a “Dear Friend” letter?

The sole purpose of segmentation is to help you personalize your organization’s appeal to each and every one of your donors. Even the smallest nonprofit organization with the most antiquated computer system can and should produce personalized letters to their friends and donors – no excuses.

At its most basic level, donor segmentation consists of breaking up your donor database (also called your “house list”) into the following segments:

Possible Upgrades: People you’re inviting to give at a higher level than they have in the past
Renewals: Those donors you’re asking to make a contribution equal to their last gift
Lapsed Donors:  Those donors who have given one or more gift in the past but did not give to your last appeal
Prospective Donors:  Individuals who have never contributed.  These are people who may have been referred by board members, or names from a rented or purchased list.

Additionally, depending upon your organization, you might include:

Your Vendors:  Businesses you do business with may well welcome the opportunity to contribute to your organization.
Volunteers:  Some organizations believe that their volunteers already contribute through their time, and they shy away from soliciting them.  Your volunteers have already demonstrated their commitment to your organization.  Offer them the opportunity to contribute financially as well.
Event donors:  The ideal time to connect with your event donors is within days of the event itself, however your event donors should be included in your appeal.
Local Businesses:  If your organization is regional and you have connections within the community, begin to build a business listing.  Are you connected with your local Rotary Club, Kiwanis or Chamber of Commerce?
Former Board Members:  Have you forgotten all about your former board members?  They haven’t dropped off the planet.  Now is the time to reconnect – in a very personal way.
Memorial Gift Donors:  When one of my dearest friends lost her six-year old son to a pediatric brain stem tumor, I made a gift every year in his memory to the Pediatric Brain Stem Tumor Foundation.  Yet organizations often tuck memorial donors away in their databases, never to touch them again.  Depending upon the situation, donors who contribute in memory of a friend or family member might contribute again – if your organization makes a point of handling the gift with grace.  Read What’s your strategy for “in memoriam” gifts? and spend some time on Lisa Sargent’s SOFII exhibit featuring before and after letters.
Former beneficiaries of your organization:  For example, an organization such as Teach for America might track and target their former students or student teachers, a university’s former students are their biggest supporters.

You might also segment your donor base by venue:  online vs direct mail.  Think about your purpose for segmentation:  recruiting new donors?  Increase the gift size or frequency of the gift?

Use your imagination when you’re thinking in terms of segmenting your own database!  In one development director position I had years ago, our organization sold donated items via eBay.     Several of our “buyers” ended up as donors.  I urge you most importantly to think beyond amounts and think of your donors as people not ATM machines.

Reprinted from Direct Mail Fundraising | The Basics and More!

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