Spending $1 to raise $1html

Spending $1 to Raise $1

Building a profitable direct mail fundraising program for a non-profit organization is like
constructing a skyscraper; it takes an investment of time and resources to go from foundation to
final, but once the building is complete, it is an asset that provides sustainable funding for the
organization

For many nonprofit organizations, direct mail has proven to be the only effective and reliable
mode of raising money. To be a successful program, charities need to build a donor base, which
can cost more than $1 to raise $1. While this strategy has been debated for years – within the
nonprofit and association communities, in Congress, and even before the Supreme Court, it has
been a proven model for more than 50 years

For nearly 70 years, Quadriga Art has helped nonprofit organizations raise money in order to
meet their mission goals and objectives. At the core of our company’s values is a focus on
innovation, entrepreneurship, creativity and a deep and abiding sense of responsibility to the
charities and communities we serve. We are committed to thinking big and making a difference, as
well as offering our clients the lowest cost mailing solutions possible. That means working with
organizations to determine what type of direct mail program is right for them

Direct mail donor files can be built gradually, where investment and growth are steady and
conservative, or rapidly, where investment levels are accelerated and the overall profitability is
higher

Gradual Donor Development Lifecycle

In a gradual growth scenario, the investment levels and cost of fundraising are lower, allowing
the organization to generate positive net income 2-3 years before an organization on the rapid
growth plan. However, since the ultimate donor file size is smaller and grows slowly, the long-term
positive net income and philanthropic potential is also on a smaller scale. The market average for
the response rate in a gradual growth scenario is 2%, and the cost to acquire a new donor is on
average $15 per individual

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Rapid Donor Development Lifecycle

In a rapid growth scenario, the initial cost of fundraising is more than the revenue generated in
the early years, since significant funds are invested to acquire new donors and quickly build a large
donor file. However, this accelerated strategy allows the organization to ultimately raise
significantly more revenue over the same time span. Through an accelerated strategy, Quadriga
Art has seen nonprofit organizations reach average response rates of 9%, with the cost to acquire
a new donor at less than $7 per individual. Because a rapid growth scenario can delay the
immediate return on the investment, Quadriga Art works with organizations to find solutions that
will allow them to provide more program services as early as possible

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Here’s our roadmap for success:

Year 1 à Create (draft the blueprint & break ground):

Regardless of whether the growth plan is rapid or gradual, the first year of a brand new direct
mail program is almost always a net investment on the part of the organization. Net income is
entirely dependent on the size of the donor file; the more donors an organization has, the more
revenue it will generate. Acquiring a new donor file is like building a foundation – it costs more than
it initially generates, but it is an asset for the future.

Year 2 à Validate (build the foundation)

In the first two years of a new direct mail program, the organization typically does extensive
testing to ensure the long-term viability of the program. While the program is typically still running
at a financial deficit at this point, it is starting to build the critical renewal donor file that will lead to
significant net profit for program services in the coming years.

Year 3 à Rollout (extensive building)

In year three, the organization will continue to rollout the strategies that were validated in the
early years of the program. In a gradual growth scenario, the organization could be generating
positive net income at this point. In a rapid growth scenario, the benefits of the new donor
acquisition program launched in year one will be apparent as the spending gap will start to close.

Year 4 à Cultivate (complete the build)

The fourth year is generally the turning point for most organizations in a rapid growth scenario;
the annual new donor acquisition loss will be offset by the renewal donor base income and the
program will generate positive net revenue. For organizations on the gradual growth plan, this step
can happen as early as year two, and as late as year six

Year 5 à Sustain (fill units & generate profit)

For either growth plan, most direct mail programs should start to show significant positive net
income by year five, even while they continue to acquire new donors. The amount of net revenue
available for program services is dictated by the growth plan; those with the largest donor files will
have the most revenue for programs and outreach.

Years 6 & beyond à Maintain (fully leased & profitable)

For most organizations, regardless of growth plan, the sixth year and beyond is where the
program is running at a cumulative net-positive basis and generating consistent and significant net
income. The skyscraper is complete

For more Info about <a
href="http://www.quadrigaartinternational.com/">QuadrigaArt</a> visit
http://quadrigaart.blogspot.com

Spending $1 to Raise $1

Building a profitable direct mail fundraising program for a non-profit organization is like constructing
a skyscraper; it takes an investment of time and resources to go from foundation to final, but once
the building is complete, it is an asset that provides sustainable funding for the organization

For many nonprofit organizations, direct mail has proven to be the only effective and reliable mode
of raising money. To be a successful program, charities need to build a donor base, which can cost
more than $1 to raise $1. While this strategy has been debated for years – within the nonprofit and
association communities, in Congress, and even before the Supreme Court, it has been a proven
model for more than 50 years

For nearly 70 years, Quadriga Art has helped nonprofit organizations raise money in order to meet
their mission goals and objectives. At the core of our company’s values is a focus on innovation,
entrepreneurship, creativity and a deep and abiding sense of responsibility to the charities and
communities we serve. We are committed to thinking big and making a difference, as well as
offering our clients the lowest cost mailing solutions possible. That means working with
organizations to determine what type of direct mail program is right for them

Direct mail donor files can be built gradually, where investment and growth are steady and
conservative, or rapidly, where investment levels are accelerated and the overall profitability is
higher

Gradual Donor Development Lifecycle

In a gradual growth scenario, the investment levels and cost of fundraising are lower, allowing the
organization to generate positive net income 2-3 years before an organization on the rapid growth
plan. However, since the ultimate donor file size is smaller and grows slowly, the long-term positive
net income and philanthropic potential is also on a smaller scale. The market average for the
response rate in a gradual growth scenario is 2%, and the cost to acquire a new donor is on average
$15 per individual

Rapid Donor Development Lifecycle

In a rapid growth scenario, the initial cost of fundraising is more than the revenue generated in the
early years, since significant funds are invested to acquire new donors and quickly build a large
donor file. However, this accelerated strategy allows the organization to ultimately raise
significantly more revenue over the same time span. Through an accelerated strategy, Quadriga Art
has seen nonprofit organizations reach average response rates of 9%, with the cost to acquire a new
donor at less than $7 per individual. Because a rapid growth scenario can delay the immediate
return on the investment, Quadriga Art works with organizations to find solutions that will allow
them to provide more program services as early as possible

Here’s our roadmap for success:

Year 1 à Create (draft the blueprint & break ground):

Regardless of whether the growth plan is rapid or gradual, the first year of a brand new direct mail
program is almost always a net investment on the part of the organization. Net income is entirely
dependent on the size of the donor file; the more donors an organization has, the more revenue it
will generate. Acquiring a new donor file is like building a foundation – it costs more than it
initially generates, but it is an asset for the future.

Year 2 à Validate (build the foundation)

In the first two years of a new direct mail program, the organization typically does extensive testing
to ensure the long-term viability of the program. While the program is typically still running at a
financial deficit at this point, it is starting to build the critical renewal donor file that will lead to
significant net profit for program services in the coming years.

Year 3 à Rollout (extensive building)

In year three, the organization will continue to rollout the strategies that were validated in the early
years of the program. In a gradual growth scenario, the organization could be generating positive
net income at this point. In a rapid growth scenario, the benefits of the new donor acquisition
program launched in year one will be apparent as the spending gap will start to close.

Year 4 à Cultivate (complete the build)

The fourth year is generally the turning point for most organizations in a rapid growth scenario; the
annual new donor acquisition loss will be offset by the renewal donor base income and the program
will generate positive net revenue. For organizations on the gradual growth plan, this step can
happen as early as year two, and as late as year six

Year 5 à Sustain (fill units & generate profit)

For either growth plan, most direct mail programs should start to show significant positive net
income by year five, even while they continue to acquire new donors. The amount of net revenue
available for program services is dictated by the growth plan; those with the largest donor files will
have the most revenue for programs and outreach.

Years 6 & beyond à Maintain (fully leased & profitable)

For most organizations, regardless of growth plan, the sixth year and beyond is where the program
is running at a cumulative net-positive basis and generating consistent and significant net income.
The skyscraper is complete

For more Info about QuadrigaArt visit http://quadrigaart.blogspot.com

Spending $1 to raise $1html

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