One of the most important concepts in direct marketing is the Life Time Value of the donor, or how much an individual donates before they stop supporting your organization. Your goal is to increase the number of times that a donor contributes to your organization, and to build the amount that they contribute each time. “Relationship Marketing” is the process of ensuring that you can increase the Life Time Value of the donor by increasing both the number of times and the amount they contribute.

Don’t be fooled by the sound of the term: “relationship marketing”. It is simply the newest spin on a common-sense approach to fundraising. Once you understand the basic premise, what follows makes a lot of sense.

So how do you build a better relationship with your donors?

• First and foremost, treat them with respect. Make sure that your staff are well trained in customer service, and that donor inquiries – whether by mail, over the phone, or through the Internet – are handled courteously and promptly. As part of this focus on customer service, ensure that “thank you” letters and tax receipts are sent out promptly. Donors do notice!
• Differentiate your donors. Some donors give large amounts, and some small. Some support specific issues that your organization deals with; and others support the entire organization. As much as possible (and practical) deal with the individual. This one-to-one treatment may involve creating specialized paragraphs within a letter which address the donor’s standing within your organization.
• Correspond with your donors appropriately. If a donor has given $20, they’re going to realize quickly that their entire donation has been spent on the ten or twelve solicitations, and the three or four newsletters you’ve sent them.
• Look for ways to treat your best donors specially. This may involve public recognition, an invitation to your annual general meeting, or some other important event.

Our three biases

• Everything should be measurable, so that you can analyze the effectiveness of each and every initiative.
• It’s only “junk” mail if it’s an inappropriate correspondence. Our job as fundraisers and direct marketers is to ensure that as few inappropriate letters are sent as possible.
• Everything we do should ensure that our revenues from our donors increases over the course of time because we have focused on building the Life Time Value of our donor base.

We’re in it for the long-haul, and not for a quick way to get some bucks out of a presumably naïve group of donors. They are not naïve, and many of the cheesy tactics used by some organizations are transparent to and resented by our donors.

Tony Lovell is President of Lovell & Company Inc., a company helping its clients to achieve exceptional results through effective Direct Marketing programs. His company assesses programs, develops strategy, and provides a full range of creative and production services. He can be reached by calling (416) 763-7173.