The handy guide to DRTV metrics – part 3
Howard Lake | 16 June 2015 | Blogs
Your last section of the guide has arrived! Missed part one on How to ask and how much? or part two on Turning a prospect into a regular donor?
PART THREE: Metrics and DRTV
This section will cover insights to what specific metrics matter to DRTV and their cost.
What metrics matter for DRTV?
Typically DRTV, in common with most acquisition channels, is measured either by cost per lead or donor or 12 months return on investment (ROI). What makes DRTV different is that the upfront fixed costs can be high in comparison with variable costs such as media and telemarketing. So the question arises how to treat fixed costs? As we expect to be able to use the ad several times, we generally advise amortising the costs over the number of campaigns it is used. When reading the results, we include the variable costs only, so that campaigns can be easily compared.
So what is a reasonable ROI? Generally, depending on any payback rules applied by the charity, an ROI of 0.4 will deliver payback in under four years. So the higher the initial ROI, the quicker the payback. Get 0.6 ROI and payback should be achieved in two years.
To make this happen, an active supporter development programme needs to be in place as well.
Getting the balance right between actively engaging them and quietly leaving alone is a hard one. TV donors behave somewhere between direct mail donors and direct dialogue ones. They are not as direct mail responsive as direct mail donors but more so than direct dialogue. This does not mean never mailing or emailing them. It means choosing your moments, responsive times like Christmas or for important appeals. They do respond well on the phone, so upgrade is best achieved by phone.
Attrition levels can be around 20% in year one and then steadily improving thereafter and will be better than direct dialogue.
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Costs
As cost is always an important consideration for any charity, there are a number of ways to reduce the upfront costs of a campaign.
• Many charities now have plentiful supplies of film, often created for other events and purposes. Many successful hard working DRTV ads have been creatively put together using existing footage.
• Music is hugely important for creating an emotional back drop and enhancing the desire to respond. There are plentiful supplies of library music with no charges for copyright or licences to be paid.
• Voiceover artists. Actors are often willing to forego royalty payments and may donate their session fees too.
Summary
Running a successful DRTV campaign is a complex exercise not least because the fulfilment end of the campaign has several stages which can go wrong. Equally these many stages can with careful planning bring even better results.
Dave Brailsford, coach of the British Olympic cycling team had a philosophy of ‘the aggregation of marginal gains’. Improve everything by 1% and you have a winning formula.
Gail Cookson is Fundraising Director at WPN Chameleon, where a highly talented team of 55 people operates across all areas of digital, direct marketing and DRTV. We work with a wide range of charities and commercial organisations.
Image: As seen on TV by squarelogo on Shutterstock.com
About Howard Lake
Howard Lake is consultant editor of UK Fundraising. He founded the site in 1994 and successfully sold it in 2022. As director of Giving X Ltd he is exploring growing giving on a massive scale.
He is the founder of Fundraising Camp and co-founder of GoodJobs.