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5 Things Wrong, 5 Things Right With Direct Mail Fund Raising

Direct mail is not the perfect fund raising tool. While it has many advantages, it also has its weaknesses. You should know both the advantages and the disadvantages of direct mail before you decide to proceed.

What's Wrong?

  1. Direct Mail Fund Raising Costs Too Much. Let's face facts. It costs too darn much to raise money through the mail. The number one culprit, postage, has increased many times faster than the Consumer Price Index in the last decade. In fact, postage typically amounts to 40% or more of all direct mail expenses. This means that your cost to raise a dollar is going to be high, too high.
  2. It Takes Too Long. A typical start-up organization or campaign won't get any money out of the program for six months or more after the first mailing. You must build your donor file before you can expect to receive significant sums of net income from your direct mail program. In other words, direct mail doesn't mean instant money.
  3. The Risk Is Too Great. A new organization has no way of knowing whether or not direct mail fund raising will work. That's why a test is important. And our experience has shown that only about 40% of all tests succeed. Or to put it another way, 60% of all test mailings fail.  At Eberle Associates we aim to take the risk out of direct mail by offering our no-risk test mailing to non-profits, and our low-risk test mailing to candidates and PACs.  That way, you can find out if direct mail is right for your campaign or organization at little or no risk to your bottom line.  Click here to learn more about our test mailing offers. 
  4. You Can Never Stop Sending Out Prospect (Donor Acquisition) Appeals. No matter how successful your direct mail program is, the prospecting must continue to replenish the attrition of donors from the file. Why? Because your donors, just like donors to other groups, move, die, become uninterested, or their financial situation changes. These donors must be replaced if your direct mail fund raising program is to generate the amount of funds you need to support your cause and the only way to do that is to keep sending our prospecting appeals.
  5. Prospecting Is a Loser. That's right; while there are exceptions, almost all organizations lose money in the prospecting process. This means that the net income from house appeals goes not only to your projects and programs, but also to cover the prospecting losses. Of course, your organization or campaign may prove to be the exception to this rule, but don't count on it.

What's Right?

  1. Direct Mail Provides a Sound Financial Base. Once the direct mail program has generated your house list, you can count on a steady flow of net revenue from its direct mail program for years to come.
  2. It Provides an Opportunity. Direct mail unites average Americans into a powerful force for good. It gives donors of all sizes in all parts of America an opportunity to participate in solving problems, preserving institutions, and otherwise making America a better place to live. And when donors help, they feel better about themselves and about their country.
  3. It Demands Accountability. Organizations and campaigns that depend on direct mail for support must perform. Without performance the contributions dry up.
  4. It Provides Independence. Because direct mail donors are typically small donors, no one individual donor can dictate policy or make demands upon the organization or candidate.
  5. It Enhances Image and Visibility. When hundreds of thousands, even millions of fund appeals are sent out on behalf of a foundation, advocacy group, PAC, candidate, or legal action organization, a positive and lasting image is created in the mind of the donor. This image will help to strengthen all other projects and programs undertaken by the organization or candidate.

No matter how you slice it, direct mail fund raising is no panacea. It's not right for every group and it's not the perfect solution to funding every cause. However, direct mail is, in many eyes, the core medium for fund raising of all types. To better understand why this is true, click on Direct Mail: The Core Fund Raising Medium.