Another topic that needs to be settled between vendor and client is ownership of the list—and here there is a clear dividing line between the campaign world and the charity or nonprofit world. A Politics review of more than a dozen contracts between direct mail fundraising firms and their clients shows that some firms mandate a permanent ownership interest in the lists they build, while others allow their ownership of the list to vest once the client is no longer employing the firm and all the bills are paid.
Roger Craver says co-ownership of the list is an arrangement that makes sense for firms that do political fundraising, and it’s standard practice as far as he’s concerned. “Congressional campaigns, particularly challenger campaigns, tend to go out of business if they lose,” he says. “That means those lists are lost, too. There’s an immense investment made by the firm in building that list. So a firm that’s putting up that kind of money and taking that risk will want a property interest in that list.”
To Victoria Lester, president of Huntsinger-Jeffer, which works for a range of nonprofits including The Red Cross, co-ownership of donor lists and no-risk prospecting translates to a bum deal for the clients and the donors. For a firm with a permanent ownership interest in the list, it means a continual ability to earn income from that list by renting it to other campaigns for prospecting purposes. In the nonprofit world, she says, it’s generally an arrangement that’s frowned upon.
“In the Viguerie days, that’s how it worked,” says Lester. “I call it the golden handcuffs. The firm invests all the money upfront and it’s tough for the client to leave because they own the list.”
Can It Work for You?
Way back in 1985, Roger Craver penned a series of articles in this magazine detailing the elements of a successful direct mail fundraising effort. Under the heading ‘Is direct mail for me?’ Craver wrote, “Probably not!” That’s something that hasn’t really changed. For most campaigns direct mail fundraising isn’t the most efficient way to raise money. And for many, it may not work at all.
First and foremost, the creative potential has to be there. Without an opponent to demonize, a wedge issue to exploit or a campaign that can be successfully nationalized, the average Senate or congressional race won’t be able to agitate enough activists to justify the cost of a direct mail fundraising effort. The scores of donor lists direct mail consultants rely on are mostly national lists of what you might call activist-donors. They are proven givers to conservative or liberal interests, usually segmented by issue or cause.
A conservative donor in South Dakota, for example, couldn’t care less about the parochial issues that may motivate voters in Pennsylvania’s 12th Congressional District. But paint a picture of a Pelosi-led effort, backed by the country’s villainous liberal establishment, to discredit a war hero and prevent him from capturing the late John Murtha’s congressional seat and you could have that conservative donor thinking about writing a check.
That was exactly the fundraising pitch for William Russell, a 28-year Army veteran who was gearing up for his second campaign for Murtha’s seat. If the ideal direct mail fundraising campaign needs a villain to demonize and a hero with a story to tell, PA-12 was the picture perfect district. A look at some of those mailers offers a pretty good window into what direct mail fundraising is all about. One mailer was structured as an appeal from the candidate’s wife. The outside of the envelope read, “My husband is running to replace the recently deceased John Murtha. A few hours ago I spoke to his campaign manager. I was shocked at what the liberals are planning.” Another mailer to support Russell, sent on behalf of the political action committee Freedom’s Defense Fund, came with a priority mail envelope to reinforce the urgency of the fundraising need in an attempt to up the response rate.
The reality is that the average campaign can’t make those types of appeals to donors. For your run of the mill Congressional campaign, says former DCCC Executive Director Brian Wolff, a direct mail fundraising effort is something he cautions against. “Unless you have some unique appeal, it’s very risky,” says Wolff. “Maybe if you’re running against Michele Bachmann and she says something really stupid again, it works. Or you’re an Al Franken. In that case, sure.”
It’s a different story for the national parties and committees for which direct mail is a major source of recurring cash. The advantage there is that the committees have years to test and develop their programs, which are large in scope. And with that time they’re able to get the full benefit of direct mail fundraising. A typical test mailer from a major party committee is in the 75,000 to 100,000-piece range and direct mail costs, particularly among Republican Party committees, are typically the largest single expenditure in a given year. The various party committees also have the resources and know-how to handle much of the interaction with vendors on their own, something most congressional campaigns lack. Rather than having their direct mail firm bid to printers, the committees pre-bid the process themselves.
“The real problem I found is that too many of the firms seem to take a cookie-cutter approach to every client,” Wolff says. “We wanted to be able to model our database, rather than just send more and more mail.”
To Wolff, that’s the single biggest mistake campaigns make with direct mail fundraising: thinking that a higher volume of mail is the best way to net more. When he came to the DCCC as finance director, Wolff was unhappy with the committee’s direct mail fundraising effort. He wanted a more targeted approach—one that was capable of making accurate projections of direct mail fundraising revenue. In short, Wolff wanted more science behind the program and less blind prospecting. “I went through two direct mail vendors—fired them,” he says. “The technique just wasn’t there. I said, ‘If we’re going to spend all this money on direct mail, we have to net more.’”
So back to Base Connect, the company at the center of what they call a completely manufactured storm and the impetus for this article. Despite insinuations to the contrary, there’s no evidence the firm has engaged in any wrongdoing. Base Connect forcefully defends all of its business practices and the company maintains a healthy roster of clients who say they are satisfied with its services. In Florida, Tea Party favorite and Base Connect client Allen West raised some $843,000 in the first quarter of this year. So far he has spent more than $500,000 on direct mail expenses, but told The Palm Beach Post last month that he’s confident the fundraising strategy will net big dividends in the long run. What is clear is that the no risk model employed by Base Connect and some other firms, is one many people in the business object to, insisting that it doesn’t have the best interests of the client at heart.
“Sometimes folks say, ‘You take all these candidates in races where they have no real shot at winning,’” Centanni says. “Well, this is America. I don’t like when Democrats don’t have challengers and I don’t like when Republicans don’t have challengers.” Enter candidates like Brian Chavez-Ochoa whose 2006 campaign against House Speaker Nancy Pelosi Base Connect raised money for, and Chuck Morse, the Massachusetts talk radio host whose campaign against Barney Frank began much of the criticism heaped on the firm.
“It’s not that we thought he could beat Frank,” explains Centanni. “But Frank should have a challenger and he spends a lot of money around the country helping other Democrats.” In other words: forcing Frank to spend some of that money defending his own seat might help other Republicans.
In the end, there’s a certain sense of buyer-beware that consumers of direct mail services, or any campaign service for that matter, have to possess. The campaign itself has to take some level of responsibility when it comes to understanding the arrangements it enters into. The reality, says Victoria Lester, is that it’s nearly impossible to tell if firms or associated vendors are marking up certain services. When it comes to postage, for instance, she offers this warning: If a firm is fronting the costs for postage, the campaign should ask for a postal receipt from the company so they know the precise postal cost.
On the part of the consultants, says Roger Craver, it’s about openness and transparency. He warns firms to take it upon themselves to avoid even the appearance of conflict of interest. “There are certain things that just create a very clouded appearance,” says Craver. “And politics having the reputation it does, we should be avoiding that where we can.”
Shane D’Aprile is the senior editor of Politics magazine.