Its four main priorities are to combat poverty, reduce isolation, prevent ageism and challenge poor care standards. The charity raises more than £75 million each year to tackle those problems, and works to address issues that matter most to older people.
Like most charities, Help the Aged is finding the donations market increasingly competitive, and is under pressure to make sure that its marketing resources and budget are used as efficiently as possible. In the past, the charity has successfully worked to improve the targeting of its fundraising activity.
Help the Aged's existing system for targeting supporters for its direct mail programmes was based on the 'recency of last gift' principle. This meant that new mail shots went out to everyone who had made a donation in the past four years, irrespective of how often they gave or the value of their donations. However, the charity was sure that it could develop a more efficient system.
Aims Help the Aged wanted to develop a new, more efficient direct mail targeting strategy. The idea behind the strategy would be to cut back on the cost of sending out mail packs while still retaining the majority of donations. This would involve reducing the number of recipients of its direct mail campaigns without losing potentially high-value donors.
How it worked Help the Aged decided that the 'recency of last gift' approach was too broad a measure because it placed equal value on donors who had given low values and those who had given much larger gifts.
The charity decided that frequency and value of gifts were also important factors in assessing the potential value of donors, so decided to incorporate these variables in its donor analysis. Ideally, the new targeting system would be able to discriminate between donors so that those who gave larger gifts more frequently were favoured. For example, if two donors both last gave within the four-year period, the donor who gave a one-off gift of £5 should be removed from the active database much more quickly than the donor who gave £50 every year.
The charity decided to approach data analysis company SPSS to help it come up with a solution. A 'recency frequency value' model was then developed using SPSS software. This involved ranking Help the Aged's database of donors by recency, frequency and average gift value respectively. Each of the three lists was then split into five equal bands, and assigned a score from one to five. This meant that each supporter was left with three scores representing the recency, frequency and value of their donation history.
Over its next few direct mail campaigns, Help the Aged calculated the income for each score and compared this with the mailing costs. The charity was then able to remove any donors providing a poor return on investment or whose gift was less than the mailing costs. This dramatically improved the efficiency of future direct mail campaigns.
Results By implementing the 'recency frequency value' model and tailoring its selection criteria, Help the Aged found it could cut costs by mailing fewer people but still retain income levels from supporters. The savings that were made by pruning the database and reducing the number of mailings far outstripped the small loss in income from each campaign.
"One mailing saw a doubling of both response rate and gross contribution per person mailed when compared with a similar campaign run two years earlier," says Stuart McCoy, database marketing analyst at Help the Aged.
"Without the use of SPSS our database was not flexible enough to allow us to manipulate transactional data, so it would have been impossible to duplicate this methodology."