Converting List Members into Donors Target User Forum—Boston, April 2008

1. Converting List Members into DonorsTarget User Forum—Boston, April 2008 Defenders of Wildlife & Defenders of Wildlife Action Fund

2. Agenda • A little bit about Defenders • Background: Why convert online activists/e-supporters to donors • How to convert • Case study • Measuring ROI

3. Defenders and Online Objectives • Defenders of Wildlife - founded 1947 • 160 total staff • 9 Online Marketing and Communications Dept. staff—websites and email • Over 620,000 e-supporters • $3.2MM raised last FY • Defenders of Wildlife Action Fund – 501(c)4 sister organization • Objectives of Online Dept. • Fundraising • Advocacy / Offline Activism • Education • List Growth • [Influence elections (501c4, only)]

4. Why convert online activists to donors? + * Penetrate younger, more affluent audience * Often more satisfied and engaged supporters, too!

5. Background: Online activists can become valuable donors Value from least to most: • Offline donors without email • Offline donors with email • Online donors [~same as offline donors with email] • Online/offline donors • Online donors: younger (average age 49 vs. 62); higher avg income

6. Online gifts larger than offline; multi-channel donors are best Online avg gift size growing; offline almost constant Source: Defenders of Wildlife—Jul06-Jun07

7. Acquisition source also a value-driver: Better to acquire online despite slightly lower retention rates Data based on Defenders of Wildlife Jul04-Jun05 donors by source

8. Defenders donors are migrating from online to offline, but not visa versa • First-year donors—made only offline donations in 2006 (who gave in 2007): • 97.7% gave offline only in 2007 • 2.3% gave online (and in some cases offline) in 2007 • Problem: Often no email addresses for offline only donors • First-year donors—made online donation in 2006 (who gave in 2007): • 47% gave offline only in 2007 • 53% gave online (and in some cases offline) in 2007 • Online donors converting to offline • Direct mail (DM)/telemarketing (TM) critical for retaining online-acquired donors

9. Question: So is it best to convert activists to donors online? • Short answer: Probably “yes” because: • Lower costs to converting online • Larger gifts online • Online-acquired donors more valuable • Easier to make multi-channel if online donation first • Longer answer: We don’t actually know • Anyone compared value of online activist whose initial donation is online vs. offline? • Anyone compared value of a) online activist turned donor vs. b) origin offline donor vs. c) origin online donor? [DOW done a bit] • Conclusion: Most important to convert and multi-channel is most powerful so try to convert quickly online/TM/DM

10. How to convert activists to donors… • Solicit • Online • TM • DM • Other channels? ;-) • Insufficient testing for firm conclusions, but “general guidelines”: • Solicit promptly—”Strike while iron is hot!” • Coordinate online/TM/DM • Solicit on activist origin issue and/or recent issue took action on

15. Time to first donation notes • Don’t give up too soon (online) • EOY great time to convert • Maybe give up pretty quickly offline • More rapid diminishing return on activist names offline than other NPO donor lists • DM/TM revenue should come in sooner • Defenders integration improving so more front-loaded offline revenue • DM/TM increasingly important over time (e.g., renewal)

16. Activists to offline donors: Segment activists for DM/TM efforts…and test packages [DM below]

17. Defenders segments activists on… • # of actions • Recency • Interest areas • Also considering segmenting on: • Time on file (shorter for given # of actions is better) • Age • Giving to other NPOs • Email status—valid-emailable, hard-bounced, unsubscribed, etc. • Also test: • Different packages • One-time vs. sustainer • Etc. • Find best criteria to segment, best packages for you

18. Defenders experience • Some activist segmentsTop value donors • 31% of new major donors originate thru online Join/Renew forms, 10% thru online issues • Other activist segments are turkeys • Measure each online acquisition source separately • Per above, online activist lists may tire quickly in DM/TM • And DM/TM activist response rates down ;-(

19. Measuring ROI for online activists… …is fraught with pitfalls… …so a few things to consider…

20. Basics • Include costs of acquiring ALL online activists from a given source (and use proxy if acquiring through website) • Include acquisition costs from ALL sources • Hypothetical example for 10k activists after 3 months • Costs: • Online Source XYZ @ $2.50/name = $25k • 2 DM packages = $10k • TM for targeted activists = $6/call x 500 = $3k • Premium/fulfllment costs: • Total cost = $38k • Revenue: • Online: 2% converted @ $40 = $8k • DM: 3% converted @ $20 = $6k • TM: ($10 monthly x .05) + ($23 one-time x .03) = $750 + $345 = $1.1k • Total revs: $15.5k • 3 month return: • 5.4% (540) converted to donors including ~30 sustainers • ROI: negative 59% ROI

21. Advanced—Things to consider • If already have name in online file and pay for name (again), need to include in acquisition cost • If already on offline file and adding email, perhaps only add value of online donations, thereafter • Potential equation for ROI: Costs: Costs for ALL names including: • Acquisition for all channels • Ongoing DM, TM, premium and fulfillment costs. Proxy for eCRM costs? Revenues: • All revs for unique new names that not previously on online/offline DBs • PLUS online (only) revs for records that had DM address but no email • NO revs for records with DM address and email even if email different Revs = All revs (new to file) + Online revs (email added to offline record)

22. Discussion and final thoughts • Build a great team—Probably #1 key to effective cross-channel fundraising and cultivation… • Contact info: jregen@defenders.org