In today’s philanthropic landscape, donors are repeatedly pulled and prodded by different (and certainly worthy) causes. Philanthropic competition is fierce and persistent. At the same time, donors are more mindful of their philanthropic contributions, consolidating their giving to fewer charities.

While the number of 501(c)(3) organizations and total charitable giving continue to climb, recent reports from the Chronicle of Philanthropy indicate that the percentage of Americans giving to charity is declining. Non-profit organizations can no longer simply rely on a strong mission or a previous connection with a donor for sustainable fundraising success. Rather, non-profits must ensure that their resources and strategies are properly tailored to target their needed slice of the philanthropic pie. Enter data analytics.

Complex data analysis has long been a currency of the for-profit world, used and collected from virtually all consumer and customer interactions to ultimately leverage business decisions, achieve revenue growth, decrease expenses, and curate innovation. Yet for the non-profit fundraising world, where donors are understandably viewed as more than just a customer, data collection and analysis is often a challenge. For these non-profits, the ability to effectively utilize data can potentially

  • Locate and appropriately engage the best donors
  • Motivate fundraising staff performance
  • Improve existing donor relationships

Data can locate and appropriately engage the best donors

Non-profits can use data to determine the best prospects to engage for a philanthropic contribution. Modeling can be used to examine donor demographics, giving data, and interactions with an organization to predict future giving behaviors of potential donors. Wealth screening can then be utilized to analyze publicly available data to identify those individuals who have significant financial capacity. Top prospects from modeling and wealth screening can be segmented and prioritized for comprehensive prospect research, resulting in a robust, yet focused portfolio of the strongest candidates for activation and engagement.

Used together these tools can help an organization narrow the scope of the prospect database and identify prospects for assignment to development staff, make more informed donation requests, and identify new prospects to fill the donor pipeline.

data-blog

Used together these tools can help an organization narrow the scope of the prospect database and identify prospects for assignment to development staff, make more informed donation requests, and identify new prospects to fill the donor pipeline.

Data can motivate fundraising staff performances and efficiency

Non-profits can also use data to support efficient fundraising practices and staff productivity through the implementation of data-driven performance benchmarks. Basic activity metrics including donor visits, solicitations, gifts received, and new prospects will provide the baseline health of the donor pipeline and enable revenue forecasting.

More complex metrics such as the number of prospects in each stage of the moves management cycle, the length of time between first contact and a gift, and the delta between a donation and the amount requested can promote outcome based productivity. Data-assisted performance assessment can help an organization track progress, set goals, build accountability, and foster professional growth opportunities.

Data can improve existing relationships

Using data can also strengthen the donor relationship by confirming that the donor made a sound investment. A study of more than 10,000 donor interviews conducted by fundraising consulting firm CCS indicated that the “impact of the gift” is the greatest motivation for a donor to give. Most organizations communicate

impact through personal stories. Yet with greater access to information, showing the return on a philanthropic “investment” using both personal stories and quantitative impact data is becoming the new expectation. Organizations must not only make data measurement a priority, but also understand the various ways that impact data can be effectively communicated.

While data-driven fundraising can make a significant impact on philanthropic success, it requires a dedicated emphasis on tracking and analysis. Organizations new to detailed analytics should carefully select and prioritize data for measurement and phase in metrics over time. More advanced organizations should consider the best opportunities for actionable data implementation.

Whether through hiring specialized staff or outsourcing data needs to vendor partners, organizations can utilize data to connect with their best prospects, improve staff performance, and strengthen donor relations. In a time where complex analytics have become more affordable and more accessible, the non-profit community must make their usage more commonplace.

About the Author

Greg Hagin is a Partner and Managing Director of CCS, a leading fundraising consulting
and management firm. Greg leads the CCS Philadelphia office and teaches at The Wharton School of the University of Pennsylvania. Ian Swedish is Vice President of Analytics & Client Strategy for CCS and oversees the firm’s internal data analysis. Adam Miller is an Assistant Vice President with CCS and provides strategic guidance to the non- profit sector.