We recently tested changing ask formulas for one of our clients and came away with some powerful insights.
A little background…
Our client had raised their minimum acquisition ask amount in direct mail, hoping to increase the value of new donors. They thought that raising the ask amount was sure to help. While the average gift of new donors improved, response rates dropped off dramatically.
Instead of getting more donors to give at higher amounts, nearly all of the donors who would’ve made a lower-dollar gift simply didn’t respond.
Even though lower-dollar donors also have lower long-term value , the revenue generated by them in acquisition was actually helping to pay for the acquisition effort. As average gift improved, net revenue per acquire (Net CTA) declined and new donor counts dwindled.
As we looked back over the trends, it was obvious what happened…
Masterworks recommended comprehensive ask-testing strategies to address the problem. Specifically, for rented lists, we tested adding more gift amount options in the ask array. For lapsed, we asked them for less than their prior donations (relative for each individual donor).
Our client’s tests revealed that these amended strategies were hugely successful. Response, average gift and return on investment all improved by just making some simple adjustments to the ask amount strategies.
- Among rented lists, we leveraged the lower-dollar responders in the best way to optimize ROI for the mailing and increased the number of donors giving at higher amounts, especially $100!
- Lapsed donors also reacted well to the changes. Average gift improved because higher-dollar donors reactivated better when we asked them for a little less than what they used to give.
If you want to optimize your acquisition gift asks, follow these three simple philosophies:
- Don’t be afraid of starting at a low gift amount! You are probably reaching a lot of prospects who give similar small gifts to other organizations.
- Provide more gift amount choices and larger gift options. If you don’t ask for $100, people might not know you need $100, and they will simply choose one of the few options you provide.
- Ask lapsed donors for a downgrade. Your donors never retained while you were asking them for a renewing gift at their past gift level — why will it miraculously work this time? If they give something and reactivate, they’d be worth more to you as an active donor than as a lapsed donor.
These are just a few of the things you need to know to build a solid ask strategy for your acquisition program. But the most important thing to do in order to get it right is TEST!
If you want to learn more about how Masterworks can help your non-profit learn more through testing, contact me at email@example.com.