The “S” Word That Is Good, Not Naughty

The letter "S" for "Segmentation"

The “S” word that I’m talking about is “Segmentation.”

It’s the art and science of not treating all of the people in your database the same. Instead, you want to break them into smaller “segments.”

Here’s why this is important: good segmentation will let you save money on what you’re currently doing while raising more money. Segmentation is a 2-for-1 improvement to your organization.

Here’s what I want to provide:

A super-simple guide to segmentation for smaller nonprofits.

And here’s why I want to do it: most of the small nonprofits I get to work with don’t do enough segmentation. They tend to treat every person in their database the same. They waste money and miss opportunities.

Here’s a simple summary. It’s not perfect for everyone, but it’s a good start:

  • Send your appeal letters to all donors who have given a gift in the last 18 months. (Don’t send them to non-donors, or to volunteers, or to in-kind donors, or to donors who last gave years ago – it’s not worth the money.)
  • Send your newsletters to all donors who have given a gift in the last 18 months. (Same as above — as a rule, you will spend more money on printing and postage than you will receive in gifts.)
  • However, send your Christmas/Holiday/Year-end letters to all donors who have given a gift in the last 36 months. This is the time to include your non-donors and your volunteers.
  • Send your e-appeals to everyone on your email list.
  • Send your e-newsletters or e-updates to everyone on your email list.

That’s it. There are about 15 ways that it quickly becomes complex. But the main thing to remember is that the people most likely to give you gifts are your donors. And organizations that really analyze their results quickly figure out that it’s not worth their money to send mail to people who haven’t donated in a while.

And here’s how you can use segmentation to raise more money . . .

Identify your “segment” of major donors and send them special versions of your direct mail.

Because your major donors can give you such large gifts, it is worth spending extra money on your mailings to them. Here’s what to spend your money on:

  1. Larger envelopes
  2. Nicer paper
  3. Customized proposals in the mailing

The purpose of spending the extra money is pretty simple: it’s to increase the chance that a major donor will OPEN your mailing. And if you do that with your major donors, you will raise more money!

Leave a Reply

Your email address will not be published. Required fields are marked *