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Make the call: lapsed donors responding to personal touch.

Meet the new donor, same as the old donor. Nonprofits are leaking donors these days. Finding new folks with willing checkbooks is expensive. Re-engaging donors who have lapsed is getting very fashionable, especially by using the telephone.

Nonprofits have an opening to re-engage donors by telephone because they are exempted from the national Do Not Call registry that prohibits calls to homes by for-profit companies that do not have an existing relationship with the person being called.

This is, of course, unless the boss at your charity wants to adhere to the Do Not Call rules. According to Kory Christianson, executive director of development at St. Joseph's Indian School in Chamberlain, S.D., the chief executive there has prohibited fundraisers from calf ing previous donors who are on the national Do Not Call registry. "We lose about 80 percent of our prospects because of the registry," said Christianson. He estimated that the lapsed file could be "a couple million" names. That's almost like dangling a pizza in front of a starving person and making them jump for a slice.


The organization's active file is approximately 870,000 donors, at 0-12 months.

Those donors he can call have been responding to a message that's similar to the organization's direct mail acquisition package. The script talks about an event at the school, back to school needs and support for the further education of the school's graduates, he said.

The organization's net cost per name acquired runs between $2 and $6 for its mail program. The cost to reactivate a lapsed donor by telephone has been running at approximately $2 per reactivated donor, Christianson said. The average gift, calling just donors who previously gave at least $15, has been between $25 and $26, he said.

For St. Joseph's, the net cost per reactivated name ranges from $1.20 to $10.02 for mail and via telemarketing it ranges from $1.49 to $9.93.

"Most nonprofits have more lapsed donors than current donors," said Nick Stavarz, president of Synergy Direct Marketing Solutions, Mogadore, Ohio. "About 20 percent to 40 percent of the typical lapsed donor file is willing and able to contribute. They are simply not responding to the messaging they are currently receiving. The phone is an effective tool for getting those donors back into a current relationship of support," said Stavarz.

The challenge with donors is that you have to renew them, generally, the same way that you got them, mail, mail with premium, telephone, online, etc. "If you reactivate a donor over the phone, you need to commit to using the phone as a part of the subsequent cultivation strategy," said Stavarz. "They have already proven to be phone responsive and using the phone as a part of the cultivation process will significantly increase retention rates of those donors."

Every organization has a varying definition of a lapsed donor. For St. Joseph's, it's anything older than 12 months. "Often, organizations assign an arbitrary label to lapsed donors. Most often it is 13 months+, 18 months+, or 24 months+," said Stavarz. "Really, a lapsed donor is any donor whose propensity to continue supporting the organization has significantly decreased. That depends a lot on the strength of the commitment that had previously existed. A new, one-time donor lapsed faster than a long-time donor. Even with long-time donors, someone who hasn't given in six months has a lower probability of giving again than someone who gave last week. That being the case, a strong argument can be made for calling donors after six months of inactivity at the longest," said Stavarz.

Like any good or service in a tough economy, price is negotiable. In the case of Oblate Missionary Society, Inc. (OMSI-Belleville), that cost was zero. The organization tested reactivation (13 to 24 months) and lapsed (25 to 60 months) donors during an eight-week period this past spring. The organization's vendor made 82,000 calls and received 11,400 pledges, of which 6,500 were fulfilled. It was a positive response rate of 7.9 percent.

Mark Etling, the group's donor development manager, considers the 7.9 percent response to be very good, compared to the normal 3 percent to 3.5 percent via direct mail reactivation segments.

The organization also tested making thank-you calls to those who had given by phone. Those who then received a piece of mail were more than twice as likely to give again than someone who had not received a call, Etling said.

The organization had a no-risk contract with a telefundraising firm that said it would receive anything more than cost to reactivate donors. While the calling brought in an average $22 gift, the revenue did not exceed costs. However, it cost the organization nothing and it now has put those donors into an active file for direct mail, said Etling.

Stavarz explained that benefits of using the telephone to reactivate lapsed donors are that "you can usually negotiate a breakeven guarantee with the call center. Just make sure there are no strings attached like giving the call center any rights to call the donors again in the future."

He said that in these tough times, many phone centers would rather break even and keep staff working in wait of a larger contract than to let people go and have to retrain staff.
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Article Details
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Author:Clolery, Paul
Publication:The Non-profit Times
Geographic Code:1USA
Date:Oct 15, 2009
Previous Article:Acquisition challenges: focus on audience strategy before creative.
Next Article:Nonprofit goes mainstream social entrepreneurship courses jump 470%.

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