Monday, November 30, 2009

Dear Misguided Customer...

Dear Misguided Customer,

I know times are tough and resources are scarce. Yes, I realize that everyone is trying to come up with ideas to pinch pennies and save money.

But some ideas are just plain bad ideas.

Yes, I know that God helps those who help themselves. I’m sure the Bible and Ben Franklin would agree. Self-sufficiency is a good thing.

Yes, I know that for years your organization has used volunteers to fold, insert, seal and stamp your appeals and newsletters. So what if the news is stale by the time it gets to its destination? Your volunteers get a sense of connecting with your organization and doing something good for their community. Tradition is a good thing.

Up to a point.

Continuing to do something the “way we’ve always done it” those are your exact words!—without questioning if that way works any more isn’t just bad, it’s plain stupid.

Yes, I know you’re the newbie on staff. You don’t want to shake things up or jeopardize the job it took you 8 months to find. I got that. But blind adherence to “Tradition” is costing your organization cold, hard cash—money that could be put into services.

I bet your boss would love to simplify her life, get newsletters and appeals out faster…and save the cost of your salary in the bargain. The only thing standing in your way is “Tradition.” Show her what I’m going to show you, you will be her hero on the white horse. And that’s a lock-tight guarantee.

Hang on. Here we go…

I betcha that years ago, when a newsletter or appeal was ready to mail, someone—probably your predecessor—called for all hands on deck from the office staff. But that got old really old fast. Maybe the task built staff esprit de corps, but when assigned duties weren’t getting done, there was a lot of bad juju.

So your predecessor put out the plea for volunteers, and volunteers—God Bless ‘em—responded. For years that cadre of loyal ladies folded and stuffed, licked and sticked their way through countless thousands of envelopes.

It takes 3 weeks to get out each newsletter, but it costs your organization nothing. Right? Let’s think about it.

You have to feed the ladies milk and cookies, and you have to keep supervisory staff on hand “just in case.” But that is minimal. Right?

You have to keep recruiting volunteers, which is a constant hassle, but…

Then once a year you have to throw a big “Volunteer Appreciation Gala.” While that gala costs a lot of money, and takes a bunch of staff time to coordinate, it is the price you have to pay to compensate your volunteers.

Your organization is stuck in the past, my Friend, in “Old Think.”

Here are the facts:

1. It takes 3 weeks to assemble, address, wafer seal and mail 10,000 newsletters. The “news” in the newsletters is old by the time it hits the mail. In this day of instantaneous news, stale stuff is poison. That’s an obvious image problem for you. It makes you seem out of touch. Fuddy Duddy. No wonder new volunteers are scarce.

2. Because your appeals aren’t unique to each donor, the likelihood is that you are as asking donors who could give $100 to give $10—your “default” ask. This screams out for better data management and personalization. It’s costing your organization big moola.

If points 1 and 2 address squishy unquantifiables, here is what Blind Tradition is costing in cold, hard cash:

3. It takes a staffer 4 hours every night to supervise the volunteer crew. If that person makes $20 an hour, you’re spending $80 a night to get “Free” labor. $20,800 a year.

4. Volunteer victuals are another $20 per night. That’s $100 a week. $5200 a year.

5. What does the Volunteer Appreciation Gala and extra wear and tear on your facility cost? I can’t even hazard a guess.

Discounting the Gala, you're at $26,000 a year in expenses to compensate your “free” volunteer labor force. Not enough to convince you to rethink Old Think Tradition? Try this:

6. You’re paying 17.9 cents each in postage per newsletter. It’s better than paying First Class, but as a non-profit you should be paying about 13.2 cents! That means you’re paying an extra 4.7 cents per piece in postage because you lack the basic mailing technology that the USPS requires.

Every month your 10,000 newsletters are contributing $470 unnecessary postage to the USPS. That’s another $5640 a year.

See how you're paying your -- salary $ 31,640 -- a year in unnecessary costs? That’s a lot of money any day, but in this economy that’s an enormous waste.

Yes, waste. Stupid waste.

And it gets worse.

7. You know that many the addresses you’re mailing to are wrong and many of the people have moved. But you don’t know which are wrong, and you don’t know how to fix your list. So you keep mailing to them. Yet every one of these badly addressed pieces is costing you money: Money to print. Money to mail.

If you have money to burn—and I know you don’t—then keep on using your Old Think Traditional ways.

The solution is obvious: move your direct mail marketing into the 21st Century by working with a professional direct marketing firm.

Work with them to clean up your list. Correct bad addresses. Get rid of deadwood. Run your data against NCOA—National Change of Address software. Cost: $50-100 plus any data clean up effort.

Now turn your mailings over to that mailing professional. Your postage will plummet and you’ll be in the mail lickety split.

Cost: Roughly $500 to process your 10,000 newsletters.

Production time: 2 days

Bottom line: 2 days versus 3 weeks. Best yet, the postage you’ll save pays for the mailshop. Not bad, eh? But there’s more: because your mail will have barcodes, it will arrive faster and in better condition.

You’ll see some cost increases in your appeals, but the extra effort to personalize letters and responses will bring in far more money than the cost of the personalization.

Don't know where to turn? Call me. I'll give you recommendations.

Don’t believe me? One of our nonprofit clients brought in 35% more than they had ever raised before just by personalizing the letter and the ask. Another raised increased its average gift to almost $90 simply by upgrading ask amounts!

It isn’t magic. It’s marketing. It’s using modern mail technology to replace outmoded though well-meaning volunteers.

Now don’t get me wrong. I’m not anti-volunteer. In fact, I’m strongly pro-volunteer. I just believe in using volunteers in ways that make sense for both the volunteers and the organization and the community.

There are, after all, things that a machine just can’t do. Like being human: Manning hot lines…consoling crime victims…counseling rape victims…hugging and clothing the newly homeless…feeding the hungry…providing hope and stability for those who need it the most.

Tradition is good up to a point. And you reached that tipping point some time ago.

It’s time to put your uniquely wonderful volunteers to work doing the work they can best do: serving the community your non-profit was commissioned to serve.

Self-sufficiency is fine.

Being a hero is even better.

1 comment:

Anonymous said...

True and well said