I’m a bit of a planner. It’s a big part of why working in the direct mail industry appeals to me—we get to plan months in advance before we execute campaigns and projects.
This carries over to my personal life, where I’m constantly looking ahead. For example, I have 529 plans in place for my children. For those who are unaware, these savings plans allow you set aside funds for higher education, let the portfolio grow, and then withdraw them tax-free to pay for things like tuition and room and board.
It’s probably no surprise, then, that I’m a big fan of donor-advised funds (DAFs). They offer a tremendous opportunity for donors to set aside funds for charity and receive an immediate tax benefit.
The tricky part for nonprofit organizations is that people tend to forget they have put money in their donor-advised funds. Once it’s set aside, the funds sit there until the donor decides what to do with them.
This presents nonprofit organizations with a tremendous opportunity—to remind donors that they have a DAF and to ask for a donation from it. We shared a great blog recently that provided seven tips for nonprofits to encourage DAF gifts.
But I’d like to go one step further. I’m sharing a few examples from organizations who are really doing a great job communicating with their donors about DAFs.
DAF Opportunities in Direct Mail
First is an example of an organization that is using data to better target DAF donors in direct mail: Brigham and Women’s Hospital (BWH), based in Boston.
Starting in 2019, BWH began working with RKD Group on a data model to identify donors who were likely to give through donor-advised funds, stocks or IRAs (what we call DSI gifts). Then, we mailed postcards to educate their donors about these opportunities to donate.
In three years, we’ve seen a dramatic increase in both the frequency and the value of DAF gifts. Here’s a look at some numbers that can be attributed to direct marketing:
Repetition is key when it comes to marketing, and BWH constantly talks about DAFs. Below is some standard language used on all appeals:
DAF Opportunities in Digital
Once again, repetition is key. And St. Labre Indian School regularly features donor-advised funds across their digital channels to stay top of mind for donors.
A quick glance at the St. Labre website, and you’ll see it mentioned in a homepage banner …
On the footer of every page …
In the “Ways to Give” menu …
And on a full page dedicated to DAFs, which acts as a landing page for all DAF media campaigns and promotions.
They’ve done an excellent job bringing donor-advised funds to the forefront of the conversation with a fully integrated approach that also includes direct mail.
DAF Opportunities in Data Modeling
I mentioned data modeling with BWH, but I’d like to close with an even more impressive example. This one takes a bit more explanation, but it’s an exciting tale.
One of our national healthcare clients was looking to increase the number of DAF donors on their file. They figured there had to be plenty of DAF donors in their database that had not yet been uncovered, and they were looking for a novel way to identify these donors.
They explored using a third-party vendor that could cross-reference their donor file with a database of known DAF donors. However, the price of this method was very expensive for the large size of their donor file.
In hopes of providing more cost-efficient results, our analytics team developed a model that analyzed the organization’s current DAF donors to predict which other donors may have DAFs as well.
Using AI, the model measured more than 600 factors from the client’s first-party data to identify the key characteristics that usually lead to having a DAF. RKD’s model identified more than 12,000 individuals from their file with a “very high likelihood” of having a DAF.
To cross-reference our list, we sent the pared-down list of potential DAF donors to the third-party vendor previously mentioned for validation at a less expensive rate. From there, the organization sent a September mailing to high-value donors, segmented among three main groups:
- Donors on the organization’s file that had previously given through a DAF
- Donors identified by the third-party vendor as having a DAF
- Donors identified by RKD’s model as very likely to have a DAF
Thanks to the model, the organization was able to successfully predict individuals who had a DAF, including ones the third-party vendor did not identify, at a very high accuracy rate.
This model is already paying off—the organization has received numerous first-time gifts through DAFs from donors. That includes a $10,000 gift from a donor identified by RKD’s model. Previously, this donor had only given a single gift of $100 through a paid search ad.
It’s clear that talking more about DAFs to the right donors can provide huge benefits. So, as we close out the years and head into 2022, the planner in me has only one thing to say: What are you waiting for?