The Chesapeake Bay Foundation’s (CBF) fundraising program had flatlined, with no growth in revenue or members. The organization had focused on quantity over quality—building a large donor base using a $12 direct mail acquisition ask, as well as conducting an extensive canvassing program—and it was finding it difficult to retain and re-engage many of these donors. CBF called on Avalon to help put its fundraising programs back on solid ground by rebuilding a more productive, valuable donor file.
Objective: Avalon’s first step was to conduct a comprehensive master file analysis to evaluate the health of CBF’s donor file and identify which donors were most likely to renew their commitment to CBF. Our analysis showed that first-year retention among low-dollar and canvass donors was very poor, and the consequences were clear: CBF was left with a file of largely uncommitted low-dollar members whose anemic lifetime value made it difficult to recoup the return on investment. Avalon’s challenge was to help CBF turn around this situation and move the program toward stability and growth.
Strategy: Obviously, a bold, multi-pronged strategy was in order, and it required CBF to make short-term sacrifices for long-term gains. CBF cancelled its canvass program and retooled its donor prospecting strategy—focusing on acquiring and engaging multi-channel donors who would be with the organization for the long haul. This strategy meant that CBF would see a sharp decline in initial revenue and donors, but would ultimately create a stronger donor file by acquiring more valuable donors. A key to this strategy was to discard the rock-bottom ask—because our analysis showed that donors acquired with the $12 direct mail ask were unlikely to give again. And a higher initial gift correlated with a more valuable long-term member.
We created a long-range forecast, with an emphasis on rebuilding a high-quality, lower-quantity donor base—putting CBF on the path to revenue stability, despite a shrinking file size. CBF didn’t have as many donors coming in, but the donors who joined were more committed and valuable.
We also analyzed the file to pinpoint existing donors who would recommit to CBF, then reached them through targeted investments in direct mail, aggressive reinstatement telemarketing, major donor upgrading, and monthly giving recruitment. In this way, we offset the cancellation of the unproductive canvass program and its high volume of low-dollar-acquired donors, and we strengthened the commitment of the donors who stayed with CBF.
Results: The results have been promising. CBF’s historically low first-year retention rate is on the rise as file composition shifts. Overall retention went from 46 percent in 2011 to 59 percent by the second quarter of FY15. Additionally, the average gift rose from $49.32 to $56.15, and the revenue per member jumped from $66.20 to $85.33. Donor-level analysis showed a clear break at new joins above $25—five-year donor value is up by 93 percent for new joins with a $25 first gift.
We continue to test and look for ways to improve, but CBF’s donor file is steadily growing in value. It’s clear that we successfully put the organization’s direct marketing fundraising program back on a stable platform, where it is poised for growth.