New Data Helps Nonprofits Develop Better Donor Relationships
The vast majority of nonprofits use relationship management software to create donor profiles, record information and track giving history. Relying on traditional technology for administrative support is a regular and essential practice across the industry. But as competition for charitable dollars intensifies, is this type of technology providing enough support to help development officers measurably increase donations? And are nonprofits missing the opportunity to utilize technology to its full potential to strengthen relationships before an ask is even made?
Development executives will attest modern philanthropy is more relationship-based than ever before. Nonprofit executives must take into account the varying factors that drive an individual to give, like which charities their friends and neighbors support. They also need to understand that prospective donors have much more to give than monetary contributions. Until now, nonprofits have used technology as a means to track their fundraising progress and not necessarily as a tool to expand their donor knowledge, increase the number of donors they can manage and strategically align fundraising efforts.
As the culture of fundraising has evolved, nonprofits need to update their expectations of how technology can better support them. The future of nonprofit technology lies in the combination of data with psychology, enabling nonprofit executives to gain insights to make more informed and strategic asks. If your organization has yet to tap into technology for more than its administrative needs, take these steps and reconsider how data can paint a broader picture of every donor:
- Learn from Social Media -Accessing social data allows nonprofits to get a glimpse at a more personal side of the donor, which helps relationships to form. Did they go to college in east coast? Does your donor love tennis? Taking a look at social profiles before a meeting helps to break the ice and get to know the person better. This data also gives nonprofits insights into an individual’s philanthropic goals and needs. If a donor has grandchildren, discussing legacy planning might be of interest to them. Have they recently retired? Volunteerism might be a good option.
- Know Who They Know – Relational data helps nonprofits discover connections in a donor’s family, workplace and community who may also share an interest in your cause. From this data, a development officer can gain insights to guide their next action. Perhaps timing is off to ask for a cash gift. Instead, by referencing relational data, a nonprofit will know whether to ask for an introduction within the individual’s company to inquire about developing a corporate partnership. Another option might be requesting a donor host a giving circle with friends and family. If your donor is already a strong advocate for your nonprofit, they will be a champion of your cause in their circles, which will ultimately grow your organization’s network of supporters.
- Review Financial Data – It’s difficult to know what the right ask for an individual. Development officers should be confident that their requests are not under or over a donor’s giving capacity. Accessing prospective donor’s financial information is now possible thanks to wealth data overlays. This information enables development officers to be more strategic when meeting with clients, and have a clearer understanding of what they can give. Additionally, this data assists nonprofit leaders to determine whether a monetary gift is an appropriate ask, or if hosting a fundraiser, estate planning or volunteering would be a better fit.
- Receive Predictive Analytics – Predictive analytics paint a broad picture of a donor’s giving behavior. For instance, a development officer can see patterns in giving, like a donor averaging three $1,000 gifts per year. If that suddenly dips, the executive will be flagged with an alert to get in touch with the donor by phone or email to re-establish the relationship. Data points assist nonprofits so as to also tell when it is a good time to ask for a donation of a larger size.
Data is a highly powerful reference tool that helps guide nonprofit fundraising strategy, enable executives to be more prepared when meeting with donors and take relationship building to the next level. By taking a donor’s social, relational and financial data into consideration, nonprofits can better understand a donor’s philanthropic goals and move them from first time donors to passionate advocates.
Gabe Cooper is the Founder and CEO of Virtuous, a nonprofit CRM helping charities raise more money and do more good. Prior to Virtuous, Gabe became a founding member of Brushfire and Shotzoom Software (Golfshot). He went on to build a series of highly successful digital properties in both the nonprofit and for-profit sectors. He has a true passion for creating market-defining products and helping organizations re-imagine how to reach their constituents through technology.
