Response Rates to Expect in Direct Mail Fundraising with Acquisition and Renewal Appeal Letters
That's the most common question I'm asked by potential clients. And it's a good question, since non-profit organizations need the highest response rates they can get in today's competitive environment. Direct mail is an expensive way to raise funds if your response rates are low and your average gift is small.
So what's an acceptable response rate? That depends on the kind of mailing we're talking about.
Acquisition mailings (designed to acquire new donors) typically generate low response rates. An acceptable response rate with an acquisition mailing is somewhere between 0.5 percent and 2.5 percent. A response rate of only half of one percent might not sound adequate to you, but it's acceptable if your costs are low or your average gift is high.
Remember that generating a high response rate in an acquisition mailing is more important than receiving a high average gift, since the whole point of an acquisition mailing is to acquire donors. The higher your response rate, the more donors you acquire. And the more donors you acquire, the more donors you can appeal to in coming months, leading to higher revenue over time.
Renewal mailings (designed to obtain gifts from existing donors) typically generate higher response rates. An acceptable response rate with a renewal mailing is somewhere between 5 percent and 35 percent. Response rates for renewal mailings are higher than rates for acquisition mailings because the recipients already know you, trust you and have given to you before.
Remember that your response rate does not tell you enough. It only tells you the percentage of people who responded to your mailing. Your response rate, even if it's remarkably high, can't tell you if you made money, lost money or broke even. It can't tell you how much you spent to raise a dollar (or pound or yen). It can't tell you how much you spent per donation. Or your return on investment.
If you'd like to boost your response rates, work on your envelope. Learn how with Boost Your Response Rates and Income with Simply Irresistible Fundraising Letter Envelopes, Handbook 18 in the Hands-on Fundraising Series from Andrew Spencer Publishing.
Related Tags: acquisition, renewal, response rates, appeal letters, direct mail fundraising
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About the author
Alan Sharpe is president of Raiser Sharpe, a full-service direct mail fundraising agency that helps non-profit organizations raise funds, build relationships and retain loyal donors. Sign up for free weekly tips like this, and discover other helpful resources, at http://www.RaiserSharpe.com.
© 2007 Sharpe Copy Inc. You may reprint this article online and in print provided the links remain live and the content remains unaltered (including the "About the author" message).
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