Is your newsletter great donor relationship-building, or an unwise self-indulgence?

We asked each protagonist to pen 800 words on the main theme before seeing what the other had said, then to write a further 200 or so words of conclusion.

Written by
Tom Ahern & Sean Triner
Added
June 26, 2012


Tom’s view – Donor newsletters, love ’em or leave ’em?

By Tom Ahern

Sean’s view – The newsletter is dead. Long live the news letter.

By Sean Triner
Were the debate merely: do charity newsletters bring in sufficient revenue to justify their continued existence? My answer would be: irrefutably yes!!! (I append three exclamation points to urge you past your skepticism.)

I know this from personal experience, with my clients; I’ve seen the cheques come in.

I know this because more than a few charities have taken a newsletter workshop and watched their fortunes soar, once they applied the few lessons learned. Gilchrist Children’s Hospital raised $5,000 per issue from their old-style newsletter. Attended my webinar. Changed about six things. Now the hospital raises $50,000 per issue, 10 times as much.

And I know this from the source of all that’s good and true regarding donor newsletters: the US agency Merkle/Domain. Many of their clients (as Jeff Brooks, senior creative director, reconfirmed to me in June 2009) raise more funds through donor newsletters than through routine direct mail appeals.
Which kind of turns the world on its head, don’t you think? Imagine if your boss came to you and claimed, ‘Appeal letters are for losers. Newsletters are where the real money is.’ You’d think he was daft. (Don’t worry, it won’t happen. Bosses seem to be the last to know such things.)

Here’s my real point: not all donor newsletters are created equal. The debate question was: should you stick a charity newsletter in with your appeal? A misguided assumption behind that question is that all charity newsletters will be pretty much alike, like newborn children.

But they are not. Many, if not most, charity newsletters (my statistical sample now stretches into the high hundreds, I’ve evaluated that many) are badly done and most likely produce little results. And a few are wonderfully done and produce extraordinary results: increased immediate income, increased future income (bequests) and improved donor retention.

Fundraiser, ask yourself: where do I rank our donor newsletter among my various tasks? If it makes your top 20 list, you’re unusual. If it makes your top three list, you’re headed for greatness.
We all avoid tasks we do not understand, or like. Too many fundraisers see donor newsletters as (at best) necessary evils or (at worst) annoying wastes of precious time and money. Ask an auditorium full of fundraisers, as I have, ‘How many of you mail your donor newsletter six times a year?’ Virtually no hands go up. Ask the same crowd, ‘How many of you mail your newsletter just once or twice a year?’ Many hands rise. A newsletter mailed just once a year isn’t a newsletter, it’s an annual report. Twice a year, it’s a bi-annual report.

Merkle/Domain’s clients, on the other hand, mail a monthly newsletter and reap the amazing rewards.
Let’s be clear regarding the purpose of a donor newsletter. It is not to sell stuff like charitable remainder trusts. It is not to ‘educate the donor’ (a cringe-inducing phrase frequently heard in the industry). It is not to brag about how great your organisation is.

The purpose of a donor newsletter is to report results, first and foremost; its other missions are secondary. Given that, how do you decide what kind of content to run in your newsletter?
Simple, fill in this blank: how have we used donor money to improve the world since our last newsletter? Merkle/Domain calls this ‘accomplishment reporting’. Others might call it ‘impact reporting’. It is a report to your philanthropic investors that answers their most basic question: what good did you do with my gift?

Renowned brand consultant Scott Bedbury observed that great brands, ‘are stories that are never completely told’. Where do you tell that kind of never-ending story? In your donor newsletter. (And on your website. And in your annual report. And in your appeals. And in your presentations. And in your case. And in your grant proposals. And in your elevator speeches.) Let’s return to the original question posed in this debate: should you stick a newsletter in with your appeals?

I think it’s the wrong question. Given my belief in the superb (and mostly unrealised) power of newsletters to raise money, I think the relevant question is: should you stick an appeal letter in with your newsletter? My answer is firmly no.

When you buddy-up a newsletter with an appeal letter (or vice versa), you diminish both. Any mailing should have just one hero, either the appeal or the newsletter. You want to ruthlessly focus on the task at hand. The task is either asking for a gift (appeal). Or reporting on the success of prior gifts (newsletter). Not both.

Less is more, once again.

Now, Tom’s final words, written after he’d read what Sean had to say (He’s allowed a few more now, as his first piece was the shorter):

Tiresomely ignorant

Debate Sean? Crossed swords, scars and all? Sigh. I wish I could. But today is not going to be Pick on Sean Triner Day. Though he’s dead wrong when he asserts, ‘In tests, a good direct mail appeal beats a good newsletter in raising direct cash.’

More than a decade of rigorous testing by Merkle/Domain proved exactly the opposite: newsletters can bring in significantly more revenue than direct mail appeals. Not every time, but many times. Counterintuitive, I know; so much of the good stuff is. But Merkle/Domain has a prestigious client list for a reason: their well-tested methods produce rewards.

Mostly, though, Sean is dead right. He dismisses editorial committees. Me, too. Editorial committees are ignorance raised to a higher power.

I have a different bone to pick, actually. It’s with you, the reader.

Here’s my question: how can a profession (fundraising) so utterly dependent on effective communications be sotiresomely ignorant of the basic tools necessary for conversing with individual donors: direct mail, websites and, today's topic, newsletters.

It’s not that donor newsletters are hard to do. On the contrary. Yet most organisations give more thought to their morning coffee than they give to what their newsletter should say. ‘What do you wanna put in this issue?’ ‘I dunno, Lennie, what do you want to put in?’

I’ve looked at hundreds of donor newsletters. Ninety-seven (being generous) out of 100 just suck.

They are literally worthless: they produce relatively little donor revenue or retention.

The question to ask yourself now is this: is our donor newsletter among the three that work? A good donor newsletter operates at 70-80 percent effectiveness; it gets almost everything right. Top-producing newsletters are 100 percent effective; they know exactly what they're doing with every item.

Most charity newsletters I see, however, operate at 10 or 20 percent effectiveness. They wring nothing more than a weary moment of name recognition from their intended audience. They're almost comically boring (and don’t know it). And often, to compound the waste, they’ll drape vapid contents in conspicuous graphic design, hoping that will do the trick (sorry).

© Tom Ahern, July 2009
















There are good charity newsletters and there are bad charity newsletters. But so many are bad that a radical rethink on the approach to them is needed. I base this on my studies on newsletters in the UK, Australia, New Zealand, Canada, Hong Kong and the USA, but it surely applies equally in other countries.
Some years ago, I ran a series of workshops in Australia called ‘the newsletter is dead’. The reason for the title was simple: many charities were using newsletters as part of their donor care, as well as for appeals, corporate sponsor incentives and often just to give board members and CEOs the chance to be photographed with a big cheque.
Attendees at the workshop all agreed that newsletters are simply part of donor communications.
Then we looked at why donor communications are important and what makes good donor communications. All agreed that donor communications are valuable for raising money, keeping donors, for feedback (both ways) and to make the donor feel involved. Sometimes the actual communication is part of the charity’s remit – for example, Amnesty International telling members about human rights abuses and calling them to action.
But what are the key factors for making such communications good? We agreed that good donor communications would be:

    * Regular.
    * Honest.
    * Reliable.
    * One-to-one communication.
    * Relevant.
    * Emotional, with motivating stories.
    * Recognition of the donor’s contribution.
    * Focused on information about beneficiaries.
    * Showing the impact of donations.
Immediately after agreeing these criteria, we distributed to everyone a newsletter from one of the charities there (not their own). They then assessed these newsletters against criteria of what makes good communications. Only one newsletter ‘scored’ above 44 per cent.

Most scored badly because, whilst created with good intentions and sometimes within an overall communications strategy, newsletter design and production tended to break down within two or three issues, even if the first couple were good.
I wanted to know why. After much soul-searching and using ‘five why’* root cause analysis, we found three real problems:

    * One size fits all – newsletters tend to be produced for all everyone: activists, corporate donors, trusts, enthusiasts, casual contacts, different types of individual donors (from grandparents to younger donors, donors recruited online and through face-to-face techniques, etc).
    * Deadlines force editors to cast about for ‘stuff to fill the newsletter’.
    * Lack of control – with so many audiences, there are lots of interested parties internally and everyone wants a say in the newsletter. Editorial committees are born.

The outcome is that most charity newsletters end up being very focused on the organisation, with pictures of cheque presentations, the great and the good, platitudes to corporate donors and statistics. Beneficiary stories do appear, but are rarely the focus of the newsletter and there is no personalisation, everyone gets the same, usually dull, newsletter. These are bad newsletters.
Despite these shortcomings, we know that when a newsletter with an explicit ask is sent to donors who are responsive to direct mail it usually makes a good profit. And more frequent communications, including newsletters, are known to increase retention. When asked about newsletters, no matter how bad, donor focus groups always come back positively. So why am I so hard on newsletters?
The problem with pro-newsletter ‘data’ is that it is rarely compared with alternatives – such as my news letters suggested below, or highly personalised, detailed ‘Pareto-style’ direct marketing appeals (a link to an example of such an appeal is at the end of this article).
In tests, a good, highly personalised, direct mail appeal beats a good newsletter in raising direct cash, though I have never seen a long-term cohort test to prove the long-term pros and cons.
I am actually not against newsletters – I like good ones, like those Tom Ahern, the master of newsletters, describes (If you can, go to his presentations, they are great.) Direct mail appeals, even combined with emails, don’t satisfy all donor care needs, but a good newsletter updates donors and gets them more involved. But good newsletters are so rare – surely there’s an easier way to do this?
My answer is the ‘news letter’. A highly personalised, back-to–its-roots newsletter. A letter that tells news. Updating the donor on all the stuff that is in a newsletter, but just in letter format. Looks too boring? Pictures tell a thousand words, so put some photos in the package – separately printed photos, with a message underneath saying ‘thank you for your support’. Visiting donors’ homes I see these photos stuck up on fridges. But newsletters? No.
News letters are usually three to five pages long. They’re accompanied by a feedback form, return envelope and maybe some photos. They update the donor specifically on how their donations have been used, vary depending on the donor’s responses to previous campaigns and surveys (another great donor care device). And because it is ‘just a letter’ there are no editorial committees, it’s cheaper, easier to get out and has fewer people interfering.

* Click here for an example of a superb donor care letter – a personalised ‘news letter’.
* ‘Five why’ root cause analysis is a really useful and simple method for drilling down and finding out the root cause of a problem. For more details, check out this Wiki.
* Check out a case study for a long, personalised direct mail letter here.
Now, Sean’s final words, written after he’d read what Tom had to say:

Life in the real world

Tom says, and proves, that improving a newsletter can increase income tenfold . I concur.He also says that ‘many ... raise more funds through donor newsletters than through routine direct mail appeals’. Again, I believe him. A good newsletter will beat a ‘routine’ or poor direct mail appeal.
But testing whether putting a newsletter in with a direct mail letter or vice versa is not really the important point.
A great, personalised direct mail appeal with multiple asks, strong copy, great case study and strong single-minded proposition will hammer a non-personalised newsletter.
Tom and I agree that most newsletters are poor. In his article he says most ‘are badly done and most likely produce little results’.
My argument is simple – a good donor communications plan should include communications designed purely to make money now and others designed to retain donors and make money over the long term – including bequests. Such a plan should include direct mail letters, surveys, feedback, donor care and other specific offers.
Newsletters are often used for the feedback part, and since most, we agree, are rubbish – just send highly personalised news...letters instead. It is the easier, real world answer.
© Sean Triner, July 2009



In short, Sean thinks no, there’s a much better way to feedback to donors. Tom thinks yes, a good newsletter works wonders. You can register what you think, by casting your vote, below.

For Tom’s free e-newsletter, click here.
For Sean’s free e-news letter, click here.

Sean and Tom want to know where SOFII readers stand on this important issue. Just click on the appropriate sign below and send your email. Carolina will count the ‘no’ votes and Maxine has agreed to come out of retirement to count the ‘yeses’. Results will be published soon, on SOFII.

So please vote now and give us your views.

About the author: Tom Ahern & Sean Triner

 

Tom Ahern, of Ahern Communications Inc in the USA.

Sean Triner, co-founder and director, Pareto Fundraising in Australia

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