As more and more nonprofit management tools are introduced to the market, the processes surrounding fundraising become more streamlined. Contacting donors, collecting gifts and amassing huge amounts of data can now be done simply with the click of a button.
As data collection becomes easier than ever before, suddenly nonprofits find themselves with a unique predicament: too much data! As few nonprofits are functioning with a full-time data analyst ready to cull out the rich insights hidden within their donor database, falling into a data trap is becoming more likely with each donation received.
As a nonprofit professional, you want to do your best to understand nonprofit data management to avoid these traps. In the following sections, we’ll explore four points to help you successfully manage your organization’s donor data:
- Which data points should you gather?
- How do you collect donor data?
- How do you analyze donor data?
- What actions can you take using insights from donor data?
The following points will reference various nonprofit technology resources to help in the process. If you’re interested in learning more about nonprofit software and the other resources described throughout, check out this guide.
With that, read on to learn all about effectively gathering, managing, and learning from donor data.
1. Which data points should you gather?
The first thing to consider in this breakdown of donor data management is simply which data points you should be gathering.
You might feel the need to collect any and all data possible, plopping extraneous fields into your data collection forms to see what you can grab. However, there is definitely a danger of gathering too much data and overwhelming your donor research tools and processes, something that will be discussed in further detail later.
For long-term sustainability, only collect and store the data helpful to your organization -- something that differs from nonprofit to nonprofit.
For example, a nonprofit putting a strong focus on grantseeking may want to focus on gathering data related to success with goals, general donor demographics, and responses/acceptances/denials. However, if you’re a nonprofit professional focusing on more generalized fundraising, you’ll have an entirely different set of data needs.
Here are a few donor data points you might want to gather:
- Basic personal information such as name, age, email address, marital status, workplace and location
- Advanced personal information such as hobbies, interests and habits
- Previous engagement with your nonprofit including donations (recurring, one-time, major gift), event attendance, and participation in advocacy campaigns
- Previous involvement in other nonprofits, including volunteer involvement and donations
- Business affairs, like employment information, history, and other public affiliations
- Political giving and SEC transactions, which can be useful for prospect research
These pieces of data are fairly basic and could be helpful for any nonprofit organization. However, you should add/subtract to this list to make it best fit the information your organization will need.
2. How do you collect donor data?
Now that you’ve gotten a look at what type of data you should collect, it’s time to examine exactly how you’re supposed to collect all of this information.
Gathering donor data
There are a plethora of sources from which you can gather donor data, and a handful of them are already doing the hard work for you. If you have any sort of digital donation process in place, you’ve already completed half the battle. Check out a few of the sources from which you can start collecting data:
- Your log of previous donations.
The best place to start gathering donor data is through all of your previous donations. These hold a wealth of information on who donated, to which campaign they gave, through which method, and how much was given! You should begin your data collection efforts by simply making sure all of this previous data is logged correctly.
- Your organization’s website.
Your organization’s website can bring in a wealth of information if you include a call-to-action form for donors to request further communication from you, like an email newsletter. Make sure any website-building or form-building tools you use include plenty of customization options to request the exact data points you want without slowing down users with unnecessary steps.
- Your organization’s online donation forms.
Similar to a call-to-action on your website, your organization’s online donation forms can do much of the heavy lifting when it comes to data collection. In addition to basic details such as name and contact information, these forms can be a particularly good place to gather information on their employers or involvement with other charitable missions.
- Social media.
Once you have a donor’s email address, you can typically locate any social media accounts associated with it. This process, called social discovery, can give you information on a donor’s interests and hobbies-- but you want to make sure to use this tool ethically.
- Outside sources.
Sometimes, gathering such a large amount of data can be too difficult for your in-house nonprofit staff to handle. In these situations you might consider enlisting a data consultant or screening company to help.
Storing donor data
Once you’ve figured out which sources you can use to gather donor data and optimized them to capture the information you need, it’s time to make sure you have a robust system for organizing and storing that data. It would be an unfortunate waste of time to gather all of this information if you have no way to manage it and easily reference it later!
In the past, this might have meant a handful of manually-organized spreadsheets attempting to harness all of this information. Now, however, your nonprofit will benefit most from a constituent relationship management (CRM) system.
In general terms, a CRM system is used to organize and maintain all of the information you gather on your supporters through any of the methods mentioned previously. Because these systems manage basically all interactions with your nonprofit, you’ll want to choose a solution that either has all-in-one functionality or is able to integrate with other services that provide:
- Online fundraising
- Payment processing
- Communications management
- Major gift management
- Analysis and reporting
You’ll want to make sure you’re choosing the CRM solution that best fits your organization. For tips regarding how to do so, check out Charity Engine’s guide to choosing the best nonprofit CRM.
3. How do you analyze donor data?
There’s no reason to gather and store all of this data if you’re not going to use it to glean actionable insights about your nonprofit’s efforts, so you need to make sure you’re analyzing it properly.
At this point, you’re probably experiencing no shortage of data to examine. That’s great, except it’s almost impossible to pull anything usable out of such a huge mass of information! You’ll want to segment your data into a few groups for a more helpful, actionable view.
Segmentation is the process of identifying unique characteristics about a donor and then grouping many donors with that same characteristic together. This creates a few more easily digestible chunks of your base for you to work with when making decisions such as method of contact, initiatives to push, and more.
After segmenting your donor data, you’ll want to look for a couple of particular characteristics to determine a potential donor’s ability and likelihood to give to your organization: wealth and warmth indicators.
The first, wealth indicators, are used to determine a donor’s financial capacity to give. Generally, you would examine things like real estate ownership, business affiliations and SEC transactions to determine an accurate estimate of a donor’s financial wealth.
While particularly helpful for discovering major gift prospects within your population, you must also consider other factors in your data analysis.
Warmth indicators refer to a donor’s affinity to give, or their natural inclination toward your organization and contributing to it. It refers to a donor’s natural connection to your cause and is most easily indicated by philanthropic markers, such as:
- Past giving to causes similar to yours.
- Past interactions with your cause.
- Observable, dedicated participation with another nonprofit.
- Previous political giving.
For more information, check out DonorSearch’s guide to the concept of giving affinity.
4. What actions can you take using insights from donor data?
Once you’ve successfully gathered, stored, and analyzed your donor data, you can begin to make a few decisions based on this newfound information. There are a few specific actions you can take using what you’ve learned through data:
- Allocate your outreach resources: First and foremost, you can use what you’ve learned through data to help you allocate outreach resources. By focusing on contacting the potential donors who are most likely to actually donate, you’ll save time and money by not focusing on those unlikely to respond.
- Perfect your donor communications: No two donors are the same. Just as two donors will prefer to give in different manners, they probably will prefer to be contacted differently as well. You can use this information to perfect your outreach methods, whether that’s through social media, newsletters or another manner.
- Make the optimum ask: You can use wealth indicators to ask donors for specific, reasonable donation amounts when soliciting gifts for your cause.
- Educate about corporate matching gift programs: Information surrounding a donor’s workplace can be valuable as many corporations offer matching gift programs. Through these programs, employers pledge to make a donation matching that made by their employed-- and many employees are unaware of these opportunities!
- Consider soliciting major and planned gifts: You can begin deliberately building stronger relationships with donors who show a strong affinity toward your organization and have the financial capacity to give in that manner. You can begin the planned gifts conversation with similar donors, as well.
Analyzing your donor data will show that all of the effort you put into collecting and organizing it were well worth it. The insights you will gather on your donors will be invaluable in every fundraising initiative you hold going forward.
Advancements in technology have made it easier than ever to gather a huge amount of data on your donors, sometimes even an overwhelming amount! While this data can provide invaluable insights for your organization, it’s hard to learn anything from it when it’s unmanageable.
By keeping these four things in mind, you’ll be able to create a strong data management strategy for your nonprofit from start to finish.