Thinking Through Segment Planning for 2022

11 Jan Thinking Through Segment Planning for 2022

11 January 2022

Last week I wrote about planning individual solicitations for your Board members and a selection of 30 or so donors: How to Make a Donor Plan.

I suggested starting with a list of everyone who gave money in 2020 before pulling your Board members and selected donors up to the top of the list. And I gave you some ideas to help you organize each person’s planned solicitation.

That work alone will help you raise more money this year.

But let’s complete the process for the rest of the 2020 donors. Conceptually, we will be grouping – or segmenting – these donors together into a manageable number of segments. And then treating everyone the same inside each segment. For example, we’ll be asking them all to give at the same level. We’ll be using the same letter or email. And we’ll be inviting them to the same engagement events. In some cases, we’ll be mailing their letters at different times of the year to better conform to their renewal date or when they like to give, but otherwise the messaging will be the same.

Here are the steps:

1. Once again, we will be populating the cells in Columns C and D with what each donor gave cumulatively in 2020 and 2021, respectively. And once again, we will be subtracting C from D in Column E to chart the differences. When the number is positive, they gave more. When it’s zero, they gave the same. And when it’s negative, they gave less.
2. So now we need to sort (or segment) this list. The presumption is that we don’t have time to treat every one of these donors individually, so we need to treat them as a group. Probably the easiest segmentation available to you is to segment by giving amount – by what they gave in 2021. Under $100, $100-249, $250-999, $1,000-2,499, and so on. But you have choices. You could segment by geography, interest affinity, giving history, age, capacity, engagement event attendance, or just about any other criteria.
3. Regardless, you’ll need to name each segment on a new row and sum the giving information in Columns C, D, and E. In this way, each segment will have its own ROW on your spreadsheet. (You still need the individual information, so keep those rows down below somewhere.)
4. Now map the segment asks into the calendar portion of the spreadsheet, treating each segment as if they it was an individual donor. Most of these asks will be conducted by mail supported by email. If you use primarily appeals, map each of the appeal months. If you use renewals, you’ll need to map each group by the month (or season) they normally renew. This means that you will need to know how many renewal asks will be made in each month: 4 renewals at @ $100 = $400 in June, and so on.

How much should we ask for? I generally recommend segmenting at least by giving level last year and whether they increased their giving from 2020 to 2021 or not. A special segment will be people who gave in 2020 and did not give at all in 2021. Doing this should give you something like 10 different segments. Regardless of the specifics of your situation, create an Ask Chart to help guide your planned ask amounts. Here’s an example:

This sounds more complicated than it is. In fact, it’s relatively straightforward if you have created the spreadsheet first. (You’ll need to get pretty good at sorting spreadsheets, but it’s not difficult.)

Note that in most cases, you can merge all of the letters for a specific segment at the same time, changing the letter date as necessary. Then, when the drop date rolls around, simply drop that month’s letters in the mail.

As you did with individual donors last week, this week we’ll ask why each donor segment will say yes to the letters and emails they will receive. I suggest you consider a specific individual you know better than others in each segment. Why will he or she say yes? Based on your answer, craft communications (newsletter articles, e-News, social media posts, and even the appeal and renewal letter language itself) that will feed that narrative.

If you do this thinking work NOW – in January – you will be less likely to send appeals that ask for help meeting a match or making an annual goal or in honor of an organizational anniversary. You are more likely to be writing about things your donors care about much more.

And if you don’t know? Figure out a way to find out. Propose a theory. Make a plan to test that theory – like a survey, perhaps. Implement the plan. For each segment if you can. Figure out what’s going on. And make sure everyone is actually asked. The more you understand about why people will say yes, the less intimidating the whole fundraising process will be.

5. Lastly, you will need to add a group of donors who gave in 2021 as new donor, or at least as recovered lapsed donors. These should be segmented out and treated differently as well.
6. Map special new-donor communications and engagement opportunities onto your planning spreadsheet.

For many organizations, the number of new donors can represent 30-40% of the entire donor group. Their so-called “first-renewal” year is super-important as donors who have made at least two gifts will have a much higher lifetime value than donors who have only made one.

Treat this group specially during the year with regular communications aimed at people who don’t know much about how land conservation works and plenty of invitations to engage with you in other ways. If you can specialize these communications even further by source code, it will help your success rate.

OK – so far, so good. But we haven’t really gotten to goals yet. You can sum across each row to see how much money you will be asking that segment to give in 2022. You can also sum down each calendar month to see how much you will be asking for by month. Either way, the chances have to be incredibly slim of getting everything you ask for.

For planning purposes, I use an automatic discount of 80%. If my column adds to $25,000, I plan on raising at least $20,000 that month. If you do that, and add all the months together, will you meet your goals?

If the answer is yes – woohoo! – you’re done.

If the answer is no, you’ve got more work to do – unfortunately.

• Can you ask the same donors for more money? How? By adding an event or an appeal letter? By asking for a larger increase the first time? You’ll need to make some calculated decisions. Make the spreadsheet adjustments and recalculate. (Make sure you revisit the questions about why they will say yes.)
• Can you bring in more donors? Tough to do with a positive net. Most new donor programs lose money the first year or two.
• Can you reduce your goals? Maybe. Better to need to do that now than wake up to a problem in November.

In my experience, too many organizations have a different problem – they haven’t figured out what their goals for the year should be, yet. They are counting on magic and fairy dust.

The point for all of this is that your work NOW, planning communications and solicitations by donor and by segment, will help you raise more money in 2022. It’s tedious, but valuable work. And this is true regardless of your organization’s fiscal year. Donors will care more about their fiscal year than yours.

Love to hear how your planning is coming this year. Are you approaching your own planning differently? Is it working? What is working?

Cheers,

-da

Photo by jeanvdmeuler courtesy of Pixabay.

PS: Your comments on these posts are welcomed and warmly requested. If you have not posted a comment before, or if you are using a new email address, please know that there may be a delay in seeing your posted comment. That’s my SPAM defense at work. I approve all comments as soon as I am able during the day.