What is it with all these charity gifts in the post?They can’t be getting loyal donors…

Why do they exist?‘Premium’ mailings are delivering extraordinary results - and valuable new donors - for Australian charities right now. In some cases, they’re getting five times their typical response rate from a direct mail rollout.

Why now?These types of mailings have existed for decades. Charities have reconsidered then recently because of cheaper manufacturing costs and declining results from other acquisition methods.

But do the donors give again?About half the donors acquired from non-premium direct mail appeals never give again. We thought that donors acquired with premiums might be even less likely to give again. We were right – but the difference was minimal.

Do you have to send more premiums to these donors?

There’s some evidence that premium recruited donors respond better to appeals if they are also premiums. But Andy, our top data guru, had a profound idea.

Andy Tidy has a profound idea “We were worried about how these donors would respond to subsequent appeals. But I realised we were looking at this wrong. What if a premium acquisition appeal acquired ‘normal’ donors within the total response. Would they respond in the same way as non-premium donors?”

Premium cold appeals appear to acquire ‘normal’ donors as well

On investigation, Andy found that premium cold mailings acquire two types of donor: premium donors, and normal donors.

The incredibly high response rates effectively subsidise the acquisition costs of donors who can turn out to be very valuable indeed. These ‘normal’ donors should be just as likely to consider regular giving, have similar bequest potential and be just as likely to give again as those recruited with ‘ordinary’ cold mail packs. A bonus is that lower value donors respond to ‘normal’ appeals too, though not quite as well as normal donors.

Why do premiums work so well?Premiums are hard to resist. Here in Australia their unusual look and feel makes them a novelty in the mail box. Even in the USA where they’ve been used for three decades, they still stand out from ‘normal’ mail, though not as much as they used to in the 80’s.

Test and Roll Out While premium mailings are achieving fantastic results for many charities, they should still be tested and developed. The right lists, creative, story and of course premium will make a difference to results. Ask amounts and propositions are also crucial.

Once the initial tests are completed, charities can gear up to rolling out. Some already are - expect to see a lot more premium mailings in 2012.One charity which conducted tests in 2010 rolled out to recruit over 20,000 new donors in 2011 – at no net cost! They actually made a profit before even sending their new donors a second appeal.

Sounds too good to be truePremium mailings don’t come without their downsides, but these are mostly about mechanics - not donor behaviour. . The main challenge is that to get good prices, mail packs need to be manufactured off shore. This creates much longer lead times and more room for delays outside your control. Storms, strikes, shipping traffic jams and - extraordinarily - even pirates could come between donor and delivery.

Would it work for you?The only way to find out is to test. Don’t expect immediate success and do make sure you have enough budget to roll the pack out if it works. The results

- and the value to your charity - could be substantial.

- Sean Triner, Pareto Fundraising

For more information and a copy of our whitepaper on premium mailings in Australia, email premiuminfo@paretofundraising.com

If you’d like to chat about your donor acquisition, call Sean on 0437 015 333 or Clarke on 07 3015 4021. You can also email clarke.vincent@paretofundraising.com

Assistance Dogs premium acquisition appeal. It achieved over 7% response rate from cold, rented lists

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