Lung association breathes life into DM push

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After nearly two decades of declining results, the American Lung Association centralized the mailing efforts of its 79 regional chapters in 2003. Today, the nonprofit's income is increasing, donations are on the rise and more new donors are signing up.

The ALA's revenues reached an all-time high of about $60 million in the late '80s. This was thanks in large part to its signature Christmas Seals program. However, because each regional chapter had the authority to determine its own mail strategy, the master file began shrinking once short-term goals took precedence. And it didn't stop.

"The long-term plan was gone," said Craig Finstad, assistant vice president of direct response operations at ALA.

The board centralized the databases, brought the direct mail program in-house and hired nonprofit marketing agency Thompson, Habib Denison to help manage its outreach efforts.

"The first year was a learning year as we tested against what was done before," said Jeff Habib, co-founder of Thompson, Habib Denison. In year two, the fine-tuning began.

Thompson, Habib Denison enhanced the segmentation by developing a more sophisticated recency, frequency and monetary scheme and layered on geography and models.

In addition, it increased the number of renewal mailings. Thompson, Habib Denison added multiple offers to try to get donors to give throughout the year, plus enhanced the Christmas Seals follow-ups with better packaging and deeper segmentation.

"The Christmas Seals offer currently generates 33 percent of renewal revenue," Mr. Habib said.

As a result, mailings to the ALA's renewal file were able to generate more revenue at the same time that the file was shrinking. In 2007, renewal rates are up significantly.

The ALA reduced the cost of raising a dollar from $1.86 in 2003 to $1.09 for fiscal 2007. The group mailed 12 million acquisition pieces in 2007 and got 382,000 responses.

ALA predicts revenue for fiscal year 2007 will reach $37.2 million, putting the group in a position to begin expanding its efforts.

In the coming year, Thompson, Habib Denison hopes to enlist 300,000 volunteers as part of a community campaign that typically targets donors between the ages of 50 and 70 years old. Volunteers will be asked to mail letters to people on their block requesting donations. The donations are collected by the original letter-sender and then forwarded to the ALA.

Thompson, Habib Denison will work on integrating the association's online and offline offerings.

"How to tie together the various campaigns and platforms is one of our larger tasks for 2008," Mr. Habib said.

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