Increasing Retention and Lifetime Value With Custom Acknowledgment Programs

We’ve discussed in past blogs how acknowledgments play a key role in strengthening donor relationships and obtaining subsequent gifts. They are as simple as a timely personalized thank-you letter, but depending on client goals, they can involve so much more.

Here, we highlight a couple of our clients’ specialized acknowledgment fulfillment programs and how Merkle RMG is supporting them.

Increasing Donor Lifetime Value

Operation Smile is an international medical charity that provides free surgeries for individuals who are born with cleft lip, cleft palate or other facial deformities. Under its previous program, the nonprofit saw an average of only 1.4 subsequent gifts per acknowledgment. It aimed to increase donor lifetime value by securing additional donations through messaging and coupons on acknowledgment packages.

Our Solution

In 2007, Merkle RMG partnered with Operation Smile to support the nonprofit’s “bounce-back” acknowledgement strategy. Operation Smile makes an “ask” with every acknowledgment, which we print and mail within two days of receiving the gift. These are printed on an 8.5” x 14” form with the bottom quarter designed as a tear-off coupon for giving a subsequent gift.

Each and every appeal sent to donors has unique text for the acknowledgement, which corresponds to the original appeal text.  Every acknowledgement is active for a 6-month period following the release of the appeal.  After that 6-month period, gifts to the appeal receive “evergreen” acknowledgement text.  With different text, the gratitude is more pointed and genuine, and not repetitive for donors who give frequently to cultivation appeals.

Merkle RMG improved the tracking of reply coupons using a scan line with a unique code on each form. In this way, we’re able to track how many subsequent gifts are given in response to that ask. The coding also drives personalized thank-you letters that uniquely acknowledge these donations as additional gifts. 

Results

By leveraging our capabilities for timely, customized response and automated data tracking, Operation Smile successfully increased its donor lifetime value. Since partnering with Merkle RMG, the nonprofit saw a 64 percent increase in subsequent gifts, with an average rate of 2.3 gifts per acknowledgment. 

Improving Donor Retention

Another Merkle RMG client is especially committed to improving donor satisfaction to increase retention rates and the average lifetime value of it donors. An area of focus for the organization is reducing attrition rates for first-time donors. With the increasing challenges and costs of acquiring new donors, it’s more important than ever to obtain the second gift that strongly correlates to a higher retention rate.

The Campaign

To help establish a stronger connection with first-time donors, the client launched a “Welcome Series” campaign in May 2016. The campaign specifically targets donors who give between $25 and $199.99.

The client sends an initial welcome letter to simply thank the donor for their gift. One week later, the organization mails a second letter that includes an "ask" for an additional gift along with a reply coupon. A week after that, a third letter is sent with a different message and a request for another donation. The reply coupons include unique source codes that allow the client to track responses. Letters go out on a daily basis to ensure timely acknowledgment and to keep the campaign in constant rotation.  

Our Solution

Merkle RMG was uniquely positioned to support our client’s new donor retention program due to our ability to program and manage the timely fulfillment of the letters in the series. Our high-tech/high touch approach allows us to quickly and efficiently print and mail the first personalized acknowledgment, then automatically trigger the printing and mailing of the second and third letters in the welcome series. Part of the personalization of the second and third mailings includes the printing of the source codes on the reply coupons to track the subsequent gifts that are made, and to measure the impact on revenue. Additionally, there are different envelopes with pre-printed teaser copy relating to the key message in each of the three packages.

Results

The campaign has been in effect for only a few months, so more time is needed for long-term insights to emerge. However, these added measures and capabilities are expected to pay significant dividends in improved retention.

Solutions for Any Acknowledgment Strategy

With Merkle RMG, clients get the flexible, personalized, high-tech capabilities they need to be effective in any acknowledgement program. We can deploy our capabilities to suit your specific acknowledgement requirements, giving you the freedom to customize your approach for staying connected to your donors.

What are examples of other unique acknowledgment strategies you’ve seen nonprofits employ to improve donor retention?