1 Converting List Members into Donors Target User Forum—Boston, April 2008 Defenders of Wildlife & Defenders of Wildlife Action Fund

2 Agenda A little bit about Defenders Background: Why convert online activists/e-supporters to donors How to convert Case study Measuring ROI

3 Defenders and Online Objectives Defenders of Wildlife - founded 1947 –160 total staff –9 Online Marketing and Communications Dept. staff—websites and –Over 620,000 e-supporters –$3.2MM raised last FY –Defenders of Wildlife Action Fund – 501(c)4 sister organization Objectives of Online Dept. –Fundraising –Advocacy / Offline Activism –Education –List Growth –[Influence elections (501c4, only)]

4 Why convert online activists to donors? + * Penetrate younger, more affluent audience * Often more satisfied and engaged supporters, too!

5 Background: Online activists can become valuable donors Value from least to most: – Offline donors without – Offline donors with – Online donors [~same as offline donors with ] – Online/offline donors Online donors: younger (average age 49 vs. 62); higher avg income

6 Online gifts larger than offline; multi-channel donors are best Source: Defenders of Wildlife—Jul06-Jun07 Online avg gift size growing; offline almost constant

7 Acquisition source also a value-driver: Better to acquire online despite slightly lower retention rates Data based on Defenders of Wildlife Jul04-Jun05 donors by source

8 Defenders donors are migrating from online to offline, but not visa versa First-year donors—made only offline donations in 2006 (who gave in 2007): –97.7% gave offline only in 2007 –2.3% gave online (and in some cases offline) in 2007 –  Problem: Often no addresses for offline only donors First-year donors—made online donation in 2006 (who gave in 2007): –47% gave offline only in 2007 –53% gave online (and in some cases offline) in 2007 –  Online donors converting to offline –  Direct mail (DM)/telemarketing (TM) critical for retaining online-acquired donors

9 Question: So is it best to convert activists to donors online? Short answer: Probably “yes” because: –Lower costs to converting online –Larger gifts online –Online-acquired donors more valuable –Easier to make multi-channel if online donation first Longer answer: We don’t actually know –Anyone compared value of online activist whose initial donation is online vs. offline? –Anyone compared value of a) online activist turned donor vs. b) origin offline donor vs. c) origin online donor? [DOW done a bit] Conclusion: Most important to convert and multi-channel is most powerful so try to convert quickly online/TM/DM

10 How to convert activists to donors… Solicit –Online –TM –DM –Other channels? ;-) Insufficient testing for firm conclusions, but “general guidelines”: –Solicit promptly—”Strike while iron is hot!” –Coordinate online/TM/DM –Solicit on activist origin issue and/or recent issue took action on

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15 Time to first donation notes Don’t give up too soon (online) –EOY great time to convert Maybe give up pretty quickly offline –More rapid diminishing return on activist names offline than other NPO donor lists DM/TM revenue should come in sooner –Defenders integration improving so more front-loaded offline revenue DM/TM increasingly important over time (e.g., renewal)

16 Activists to offline donors: Segment activists for DM/TM efforts…and test packages [DM below] MailingRespAvg gift$/thousand PEN - activist %$21 $1130 PEN - activist %$20 $650 PEN - activist 0 2.5%$19 $484 Bush/Cheney – activist %$20 $975 Bush/Cheney – activist %$19 $374 Bush/Cheney – activist 0 0.8%$21 $171

17 Defenders segments activists on… # of actions Recency Interest areas Also considering segmenting on: –Time on file (shorter for given # of actions is better) –Age –Giving to other NPOs – status—valid- able, hard-bounced, unsubscribed, etc. Also test: –Different packages –One-time vs. sustainer –Etc.  Find best criteria to segment, best packages for you

18 Defenders experience Some activist segments  Top value donors –31% of new major donors originate thru online Join/Renew forms, 10% thru online issues Other activist segments are turkeys Measure each online acquisition source separately Per above, online activist lists may tire quickly in DM/TM –And DM/TM activist response rates down ;-(

19 Measuring ROI for online activists… …is fraught with pitfalls… …so a few things to consider…

20 Basics Include costs of acquiring ALL online activists from a given source (and use proxy if acquiring through website) Include acquisition costs from ALL sources Hypothetical example for 10k activists after 3 months Costs: –Online Source $2.50/name = $25k –2 DM packages = $10k –TM for targeted activists = $6/call x 500 = $3k –Premium/fulfllment costs: –Total cost = $38k Revenue: –Online: 2% $40 = $8k –DM: 3% $20 = $6k –TM: ($10 monthly x.05) + ($23 one-time x.03) = $750 + $345 = $1.1k –Total revs: $15.5k 3 month return: –5.4% (540) converted to donors including ~30 sustainers –ROI: negative 59% ROI

21 Advanced—Things to consider If already have name in online file and pay for name (again), need to include in acquisition cost If already on offline file and adding , perhaps only add value of online donations, thereafter Potential equation for ROI: Costs: Costs for ALL names including: –Acquisition for all channels –Ongoing DM, TM, premium and fulfillment costs. Proxy for eCRM costs? Revenues: –All revs for unique new names that not previously on online/offline DBs –PLUS online (only) revs for records that had DM address but no –NO revs for records with DM address and even if different Revs = All revs (new to file) + Online revs ( added to offline record)

22 Discussion and final thoughts Build a great team—Probably #1 key to effective cross-channel fundraising and cultivation… Contact info: