Fundraising “freemiums”: do the math, not the anecdotes

What’s wrong with nonprofits, that they keep giving away stupid stuff like address labels?

Don’t they know that everybody hates that stuff, so it’s a dumb waste of money!

That’s the message in a recent article on Vox: Why nonprofits give away so much crap.

It’s interesting, but almost 100% useless.

Because the article contains almost no facts about what really happens when you send these things. Just a whole lot of anecdotes and opinions.

That’s the problem with a lot of discussions for freemium fundraising: It’s based on opinions, not facts.

And if you’ve paid any attention to what goes on in the fundraising world, you know that what people say about the fundraising they encounter and what they do with it are two different things!

To give you a picture how knowledge-based the article is, here’s how it starts:

As anyone who’s jammed yet another stack of return address labels into a drawer or flung a branded tote bag on a heap of other branded tote bags, both direct solicitations and the giveaways they precede or follow have spun out of control.

“Spun out of control”?

Well, if you just ask people what they think about fundraising freemiums — even if you carefully survey them — you could easily get that impression.

But if you looked at what actually happens when charities offer freemiums, you get a different picture.

(I’m calling them “freemiums” to differentiate them from “premiums,” which are items donors are offered in return for a gift, like the classic public broadcasting totebag. These are inexpensive things sent unsolicited to donors.)

Here’s what you won’t learn by just asking a bunch of people what they think about fundraising with freemiums: They work quite well for many organizations.

And they may work for you.

Or they may not.

Just make sure you aren’t making your decision based on what people believe about fundraising with freemiums.

Freemiums increase response to direct mail fundraising. Sometimes by quite a lot.

They also decrease average gift amounts.

There are a few other wildcards, like upfront cost of fundraising and subsequent retention rate, that also factor in.

That good/bad combo pencils out for some, and not for all.

Getting more donors, even at a lower average gift, means you also get more upgraders to major-status, more who convert to monthly, and more who make bequests. But in some cases, the lower average gift torpedoes the whole thing.

If you are making direct mail work without using freemiums, I’d leave well-enough alone, and not feel any urgency to test them. Why complicate your life with them if you don’t need to?

But if your direct mail program is struggling, freemiums are something you should look into!

Should you use freemiums?

The answer is maybe.

And the only way to find out is to try it and see what happens.

Anyone who already knows your answer without that is giving you bad information!


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff BrooksJeff Brooks has been serving the nonprofit community for more than 35 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com. More.


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The future of fundraising is not about social media, online video, or SEM. It’s not about any technology, medium, or technique. It’s about donors. If you need to raise funds from donors, you need to study them, respect them, and build everything you do around them. And the future? It’s already here. More.

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Jeff Brooks has been serving the nonprofit community for more than 30 years and blogging about it since 2005. He considers fundraising the most noble of pursuits and hopes you’ll join him in that opinion. You can reach him at jeff [at] jeff-brooks [dot] com.

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