News
 The Only 4 Numbers You Need for Direct Mail Fundraising
By Alan Sharpe, copywriter and president of Raiser Sharpe
A while back I realized that measuring the effectiveness of
direct mail fundraising campaigns is a lot easier than I'd
thought.
I was confused by all the formulas and ratios, and was never
sure which numbers were more important than the others. Cost
Per Piece, Cost to Raise a Dollar, Return On Investment,
Average Gift, all of these and at least six other metrics
kept me in a state of anxious ignorance. I was never sure
where I needed to start my calculations.
Now I know, and I thought I'd pass on to you what I
discovered in what I suppose I could call an epiphany.
I discovered that, to track the effectiveness of any direct
mail campaign, all you need to start with are four numbers.
Once you know what these four numbers are, you can perform
every calculation you need to measure your costs, revenue
and return.
These four numbers are the only ones you need to measure on
every campaign. They're the only four numbers you need to
obtain when comparing recent campaigns with those from long
ago.
The numbers are simply these:
1. Number of letters you mail.
2. Number of gifts you receive.
3. Amount of money you spend to mail the letters.
4. Amount of money you receive as gifts.
These numbers are known in the trade by various terms. I
refer to them as:
1. Pieces Mailed
2. Total Gifts
3. Total Cost
4. Gross Income
I recall these four numbers by remembering that two deal
with mail and two deal with money. The first two numbers
deal with what you mail and with what comes back in the
mail. And the second two numbers deal with what you spend
and with what you earn.
Only when you know these four simple numbers can you run the
calculations you need to make sense of your direct mail
fundraising results. Need to know your cost to raise a
dollar? Divide your mailing cost (number 3 above) by your
income (number 4 above). Need to know your average gift?
Divide your income (number 4 above) by the number of gifts
received (number 2 above).
---Source: Alan Sharpe, copywriter, author and workshop leader, is
president of Raiser Sharpe www.RaiserSharpe.com.
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