- Avalon Analytics created a League-specific zip modeling, which based its recommendations on patterns within current customer/donor demographics, including where they live. For the League, zip modeling lifted two tried-and-true lists’ performance by 44% and 54%.
- A data overlay can help determine the best prospects by using key indicators like wealth, age, transactional/giving history, etc., overlaid on your house files and purchased files or exchanges. In this case, the income data overlay did lift the average gift, but not the response rate. When Avalon overlaid age, the reverse held: a powerful increase in response, and just a small increase in average gift (up to age 65).
- Lapsed donors/purchasers are the best prospects, but that doesn’t mean they all should be mailed. A model helps figure out how deeply we can mine lapsed files. We created a linear regression model for the League, and the response proved that the modeling pulled out the best donors.
- Although this model has yet to be developed for the League, eActivists can be targeted by analyzing recency/number of actions to determine the best online prospects.
So how should you approach modeling? There are a few best practices to keep in mind:
- Your data must be clean to start with, or the results will not be successful. (Garbage in/garbage out.)
- Establish a net name agreement with your list broker – you shouldn’t have to pay for names you’re not mailing, and as this type of arrangement is becoming more the norm, it’s easier to negotiate.
- Make sure you account for all of your costs involved in modeling so that you can measure your results fairly.
- Testing, creating, and validating the right model takes time and patience. Plan on six months at a minimum.
- Test, test, and retest to find the best mix of modeling strategies.
Take the time to test models to find the best prospects in in-house and out-of-house lists. Through modeling, your organization will mail smarter, which will lower your cost to acquire a donor, while increasing that donor’s long-term value to your organization.