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Raising Planned Gifts by Mail

Excerpt from How to Raise Planned Gifts by Mail

Despite the lack of confidence we sometimes feel about direct mail's efficacy, the fact remains—it works. Maybe one day this will change—perhaps the Internet will come into its own as a fundraising medium. But for now, raising planned gifts by mail is a solid and revenue-producing strategy.

However, unlike holiday greetings and change of address notifications, your planned giving mailings can't be showered on the general population. Direct marketers often cite the 60-30-10 formula for determining a mailing's success.

Sixty percent depends on the quality of the mail list; 30 percent is based on the content of the appeal; and 10 percent can be attributed to the design or format. Since marketing dollars are precious and your board's expectations for results are high, don't dilute your efforts by mailing to anyone other than your best prospects.

Let's make it simple. Start by limiting your list to people who have met one basic criterion: Anyone who has made at least two gifts of any size to your organization (more about this in a minute).

Note some of the folks who will not make the cut:

  • Wealthy, philanthropic people in your community who have never given to your organization.
  • Everyone who attended your last auction, had a few drinks, and spent more than they intended.
  • People who have made only a single contribution of any amount.
  • Your parents, friends, or random family members who, again, fail to meet the basic criterion (OK, you can include your mom).
Once you've assembled an initial list, refine it based on the following characteristics.

  • Age

    Age 55 is a magic number in the gift planning business. It's the point, we've determined, where people seem most open to learning about and acting on philanthropic opportunities. The sight of their AARP card no longer stings, retirement is a welcome topic, their kids are leaving or already gone, they're ready to burn the mortgage papers, and a fair amount of sentimentality is setting in.

    If you're largely clueless about the age of the people in your database, consider conducting an age overlay. This involves matching your list of names and addresses against those on a list provided by a company specializing in gathering key data on households nationwide. These companies pull information from various public sources and can help you fill in the gaps without violating any privacy laws.

  • Loyalty and Affinity

    Perhaps you're wondering why it's important to mail only to people who have made a second gift. People make donations for lots of reasons: peer pressure at a golf event, as a memorial for an elderly neighbor, or because an adorable five-year-old knocked on the door asking. Typically, before donors are willing to make a planned gift, they must be connected—in most cases passionately connected—to the work and future of your organization and believe they can have a real impact on your mission. The best indicator of this is continuing support, not a one-shot gift.

    It's tempting, I know, to include the entire class of '73 or that sweet couple who have attended the annual gala for the past two years. But if they haven't made a single donation, don't waste your limited marketing dollars soliciting them for planned gifts.

  • Size of Gifts

    Note that when I suggested you mail to people who have made at least two gifts I said gifts of any amount. Yes, any amount. I've yet to find any statistical data correlating the size of a donor's annual gift to his or her potential to make a planned gift. This is true, in part, because most planned gifts are made from assets (e.g., appreciated securities, retirement plan assets, or real estate holdings) rather than yearly income.

    Further, planned gift donors come from all walks of life, not just wealthy backgrounds. We've all heard stories about the small donor who gave $25 per year for 20 years, then quietly left his or her entire multimillion-dollar estate to charity.

    I've seen both extremes when analyzing an organization's planned giving mailing list. Some are too broad in scope—including too many people without a strong connection to the organization. Others are too narrow—including only those donors who are very old or have previously given a very large gift.

    For example, I worked with a hospital that had been mailing a planned giving newsletter for several years with little response. I asked the development director who was on the mailing list. The hospital was definitely working the 55 and older crowd, but its loyalty criterion was a bit off. It had a minimum level of $2,500 in annual giving before donors were put on the mailing list!

    I explained that the profile of a planned giving donor includes more than the wealthy and suggested the hospital expand its list. About 18 months later, I bumped into the development director, who reported that responses more than doubled since dropping the $2,500 minimum.

Help! I Can't Afford My Mailing List

When money is a major constraint, narrow your list according to the following formula:

  • Pull the records for prospects aged 55 or older and look for donors who, in terms of their giving history, strike a balance between longevity and consistency. For example, pull the names of anyone who appears on your annual giving rolls for three of the last five years. Can you afford to mail to that list?
  • If the answer is no, then narrow the list further to those people aged 55 or older who have made at least four gifts at any time in the past seven years.
  • If you're still over budget, focus on those who have made gifts in five of the past eight years or mail to those who are age 60 or older instead of 55.
In short, keep experimenting until you reach a target list size that falls within your budget.

Larry Stelter
© 2008, Larry Stelter. Excerpted from How to Raise Money by Mail. Excerpted with permission of Emerson & Church, publishers.

Larry Stelter is president and CEO of The Stelter Company, a national planned giving communications firm that focuses on print and Web products. Founded in 1962, The Stelter Company and its staff of more than 80 individuals serve more than 2,500 print clients and 1,100 Web clients nationally.
Topics: Fundraising