Can Direct Mail be Used Effectively for State Think Tanks?

Whitney Garlinghouse

On behalf of the Yankee Institute, Whitney Garlington surveyed 14 state think tanks about their direct mail experiences. He recommended that Yankee not use direct mail "for the purpose of raising money from mail-in contributions." However, Garlington noted, the use of direct mail "to identify substantial prospects does appear to have merit."

Points Covered

  • Reasons to conduct direct mail
  • Survey conclusions
  • Suggestions for doing direct mail to identify large contributors

During the spring of this year, I carried out a study for Yankee Institute in Connecticut for the purpose of examining if and how the institute might employ direct mail (DM) strategies for fundraising.  The methodology used was quite simple - to contact other sister organizations around the nation and learn from their first hand experiences with DM.  Fourteen state think tanks were contacted.  What follows here is a summary of these findings, along with specific recommendations extrapolated from this information, which could be used by any state think tank.

Summary of Findings

Generally, direct mail, in isolation, has not proven to be a good way to raise money for support of state think tanks.  Prospecting is expensive and usually does not break even, although with most organizations it has come close.  The lifetime value of names procured through prospecting can easily be expected to be a positive contributor to the budget.  However, between the relatively small number of DM donors that can be expected from one state, the significant costs (both in dollars and administration time) involved to maintain these donors, and the modest overall return on these small DM donors in proportion to the total organization budget, one must question whether any DM is worth the effort.

Only about half of the organizations contacted are currently engaged in DM prospecting, although most have done at least some in the recent past.  Although raising money is sometimes part of the reason given for using DM, other purposes are usually driving the DM efforts, including:

  1. Education - To promote the organization's mission in their region and gain active supporters to help educate others.
  2. As a way to gain organizational credibility by building a broad support base.
  3. Branding - To raise general awareness of the organization.
  4. As a way to identify substantial donor prospects for future non-DM follow-up.

As one might guess, my recommendation to Yankee Institute was to forget about the use of DM for the purpose of raising money from mail-in contributions.  In addition, due to relative modest funding levels at this point in time, the first three alternate objectives listed above are simply unaffordable luxuries.  Raising money needs to remain the primary focus for Yankee.  Along those lines, however, use of DM to identify substantial prospects does appear to have merit.

A number of the organizations that I interviewed were very cognizant of the potential for DM to identify and occasionally bring in large donations.  However, no one seemed to consider this as a primary purpose for getting involved with DM in the first place.  My recommendation to Yankee Institute was to do just that - to use direct mail as an ongoing, long-term tool for identifying potential large donors to the institute, and to raise the visibility of the institute with this group so as to increase their propensity to contribute.

Specific Recommendations

These were my specific recommendations to Yankee Institute that grew out of my general findings, above.  Because it is, and will for the foreseeable future, always be large donors (institutional and personal) that provide major support for the work of Yankee Institute, the fundraising efforts of the institute should be singularly focused on these large donors.  Direct mail is only one piece of these efforts, which must be dominated by personal interaction and follow-up.

To be consistent with the quality of donor being solicited, it is important to always put fourth a first class image.  I suggested Yankee first make some improvements to their web site and logo.  The actual DM effort should be viewed as a multi-year effort, so as to not overly strain the institute's budget.  Lists can be procured by purchase of large donors ($500 plus) to state political campaigns of conservatives and libertarians and by exchanging lists with like-minded organizations.  As a side note, use of a political celebrity to sign the DM letter seems to be particularly effective and important when using lists of political contributors.  Sometimes, lists can be procured by the promise of a list exchange at a later date when Yankee Institute has a list that is more substantial to offer (this has been successfully done by the Capital Research Center).

My suggestion for the actual DM campaign strategy was somewhat unusual.  I recommend always sending high quality, issue oriented (tax issues seem to work best) DM packages with a budgeted cost of at least $1.50 each, asking only for large contributions of $500 and up, but with an option to receive more free information and be added to the institute's mailing list.  I expect that the number of actual contributions from these initial mailings will be small.  However, the list created from these "more information" responses should be very high quality, as these individuals will understand that they are going to be solicited for large contributions going forward.

This "high roller" prospect list should be further qualified by researching the individuals on it.  Although expensive software packages are available to do this, it probably can be more affordably accomplished through networking with friends of the institute, talking with the owner organizations that first provided the names, and using other publicly available information.  However, it is vitally important to obtain a fairly clear picture of each person's potential to contribute.

Once prospects are identified, then coherent strategies need to be implemented to convert them to financial supporters.  Generally, this necessitates frequent communication with the prospects for the purpose of educating them about the work of the institute and building their empathy and sense of involvement with the institute.  This should include phone calls, mailings (always done first class and usually personalized), and events (again, always first class).  Yankee Institute's existing lecture series could be an excellent opportunity for a special pre-event for just the large donors and large donor prospects featuring the celebrity speaker in a more intimate setting.  A comprehensive strategy for development of these large donor prospects went beyond the scope of this study.

Individuals & Organizations Contacted for this Study

My thanks to the individuals and organizations, listed below, that took the time to share their direct mail experiences with me, which I used in my study.  Anyone wishing a copy of the study itself may write or email the Yankee Institute at P.O. Box 260660, Hartford, CT 06126 or info@yankeeinstitute.org.

John Coonradt (VP Advancement)

Mackinac Center for Public Policy

John Hood (President)

John Locke Foundation

Sam Staley (President)

Buckeye Institute for Public Policy Solutions

Sally Pipes (President/CEO)

Pacific Research Institute for Public Policy

Richard Tostenson (Dir. Dev.)

Center of the American Experiment

Jennifer Gustpason (Dir. Dev.)

Capital Research Center

Lindsey Moore (former Dir. Dev.)

Goldwater Institute

Gary Palmer (President)

Alabama Policy Institute

Jake Haulk (President)

Allegheny Institute for Public Policy

Stephen Adams (President/CEO)

Pioneer Institute for Public Policy Research

Rita Thompson (Dir. Dev.)

Texas Public Policy Foundation

Tom Carroll (President)

Empire Foundation for Policy Research

Charles Arlinghaus (Chairman)

Josiah Bartlett Ctr. For Public Policy

Joseph Bast (President/CEO)

Heartland Institute


Whitney Garlinghouse is the retired owner/CEO of L.F. Garlinghouse Co., a publishing and mail order firm in Connecticut, and holds a BS in engineering from Cornell University and an MA in economics from University of Kansas.