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Should Your Nonprofit Use Premiums
in Direct Mail Fundraising?

by Sandy Rees

A premium is a small gift used to encourage donations. You might think of it as a bribe to get someone to make a donation now. Some nonprofits think that a premium encourages donations. Unfortunately, premiums can have the opposite effect.

People who give to get a premium aren't really donors. They want the premium, not the warm fuzzy from making a gift.

Front-end premiums are gifts that are sent along with the appeal for money. Mailing labels are a good example of a front-end premium. When you receive the direct mail package in the mail, the labels are included.

Back-end premiums are gifts that you receive after you make a gift. Public television stations frequently use mugs and t-shirts as back-end premiums for donors.

I encourage small nonprofits not to use premiums for several reasons:

  • Premiums will cost money. You will have to come up with funding to cover the cost of the premium.

  • Some donors are offended if they think their gift is used to purchase premiums. They'd rather have their gift go toward programs that change people's lives.

  • Donors who give to regular direct mail letters typically give more (on average) than those who give in response to a direct mail package with a premium.

Good fundraising is based on relationships. Do you want to build a relationship with someone who expects to get something in return whenever they make a donation? Or would you rather have donors who give because they want to and because they believe in your mission?

While there may be a time that a premium might work, small nonprofits should not use premiums for fundraising.

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About the Author:

Sandy Rees is a nonprofit fundraising coach and speaker who shows small nonprofit organizations how to raise more money, gain more supporters, and strengthen their Boards.

Want more practical tips and ideas for successful fundraising? Get the twice-monthly "Bright Ideas for Fundraising" at

(c) Sandy Rees, CFRE

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