Internet start-up Shop2u.com, Fairfax, VA, has taken the model of cooperative donor agreements between online retailers and nonprofits a step further by sending personalized e-mail messages — in the form of online catalogs — to the donor file of participating nonprofit organizations.
Unlike most online arrangements — where consumers must start off at a particular hub, choose the retailer they want to visit and then decide to which nonprofit they want to donate — the information is now e-mailed directly to them by Shop2u.com (www.shop2u.com). The e-mails are marked as coming from the nonprofit group. Shop2u.com is provided with the donor lists from the nonprofit groups it works with, which include the American Diabetes Association, the Children's National Medical Center and the Manhattan Society, the New York City Chapter of the Multiple Sclerosis Society. It is also in talks with the Arthritis Foundation and Prevent Child Abuse America.
“All of the addresses are of people who have opted in,” said Carol Folsom, vice president of member acquisition at Shop2u.com. “We make sure there is a prior relationship between the people receiving the e-mail and the organization that is sending it to them. The ultimate objective of this program is to use the e-mail channel to create a sincere relationship between the nonprofits and the constituents who want that type of relationship.”
Among the catalogs participating are Omaha Steaks, Faith Mountain, Dun Craft, Flower USA and Sportif. Shop2u.com is currently in negotiations with 25 other catalogs.
People can browse and make purchases directly from the e-mail message. Only certain sections of the catalog will be sent, but a “full catalog” button will enable them to take a look at the entire catalog.
Shop2u.com sends between two and three different catalogs a month to nonprofits' constituents. It can handle campaigns in the range of hundreds of thousands of e-mails.
“We don't want to inundate people with the catalogs,” Folsom said. “But we want to keep the information in front of them as much as possible without harassing them.”
Some of the early results from campaigns include a 30 percent open rate; an open rate between 20 percent and 30 percent of e-mails when the recipient needed to open an attachment to see the catalog; a 10 percent to 20 percent open rate for e-mails when consumers needed to access a hot-link to view the catalog; and a purchase rate of 1.5 percent to 2.5 percent for those who receive HTML-enabled e-mails. The opt-out rate for people not wanting to take part in the program has been less than 1 percent.
Surveys will be conducted to see what types of information people want to receive in the e-mails and how many catalogs they would like to receive per month.
Folsom said with each e-mail campaign, Shop2u.com hopes to satisfy one of four elements for the nonprofit organization: acquisition, retention, cultivation or recognition.
Twenty percent of every sale is taken by Shop2u.com, half of which (the minimum it will give to nonprofits) goes to the organization, and the other half goes to Shop2u.com.
“There are cases where we are only getting 15 percent from catalogers in which case we take 5 percent and the organization gets 10,” Folsom said.
In order to ensure that the program will be beneficial for the nonprofit organizations, Shop2u.com conducts a 90-day test period with them, during which time a $5,000 minimum in donations for the organization must be raised. If the test period proves to be a success, the two parties sign an annual agreement.
As part of the annual agreement, Shop2u.com will work with the nonprofit to outline a campaign strategy.
“We will determine the number of catalogs that will be sent and to which portion of their files we will mail them,” Folsom said. “As far as tracking goes, we keep tabs on the amount of revenue generated and also look to see what people are interested in and purchasing in order to create a better profile on them, allowing us to mail a more personalized message.”
Folsom said Shop2u.com tries to acquire as much information about the buyers as possible by also tracking the number of people who opened the file, who made purchases and the dollar amount of each purchase. It then provides that information to the catalogers and nonprofits.
Prior to sending any e-mail messages, Shop2u.com sends out a message to consumers asking whether they have the ability to receive images in their e-mail or only text.
“We are currently doing a test to see what is providing better results the text-based messages or the images,” Folsom said.
