Not sure how data and analytics can help your nonprofit raise more money? Let me ask you a few questions. On which day do people give the most?
What time? Desktop or mobile?
Gotcha, right? You’re probably thinking, “Well, if I knew that, it would be a lot easier to raise money for my nonprofit.”
Well, of course it would be.
And you can know that, and it will be easier to raise money. In this article, we will take a look at:
- Why the data is important
- How you can use it
- What data to track
- And the best ways to track it
Finally, we will look at some best practices for managing your donor data.
Donor Data is Key to Nonprofit Success
Your donors are critical to your success. How much they give, how often they give, the ways in which they engage, and even how much they’re able to give are all metrics that you can track that will have a direct impact on your ability to communicate with them and elicit a positive response.
When you realize that every interaction with your donors results in a data point you can use, you start to understand the impact of the sheer volume of data collected.
What are the main benefits of collecting and analyzing this data?
- You’ll know your donors. While understanding their motive to give is important, it’s also important to identify a targeted audience for campaigns or know which donors might be receptive to a peer-to-peer campaign or volunteering for your event. Even identifying a list of donors who live within 15 miles of your office can be game-changing information when you’re trying to staff a community event with volunteers.
- You’ll identify new outreach methods (and dump some that don’t work). If you launch a peer-to-peer campaign and you have great success, maybe you decide that you could leverage those social circles for a text campaign. Similarly, if you tried to be hip (because what’s old is new again) and launched a direct mail campaign that was an expensive flop, you won’t want to try it again.
- You’ll find new revenue avenues. Perhaps you add a matching gift button to your donation page and then track how many times it’s clicked and how much money is raised. Or you’ll do some A/B testing on an email campaign and find out that it’s true, people really do click on images with puppies.
Making data-driven decisions for your nonprofit outreach greatly increases your chances of success.
What Donor Data Should I Collect?
The short answer is...whatever is most important to your fundraising.
For example, if you decide that major gifts and planned giving should be the focus of an upcoming fiscal year, it’s a good idea to track wealth indicators. There will be a correlation between data like real estate ownership and the propensity to make a major gift or bequest to a charity.
If you know the business names and titles of your donors, you might decide to ask a business-owning donor to implement a matching gift program to channel his or her donations in a more tax-friendly way.
There's an objective way to evaluate your donors and their giving habits. Have you heard of the RFM model of donor screening?
- Recency refers to when a donor last made a gift
- Frequency refers to how often they give
- Monetary value gives you an idea of their giving threshold
If you want to check out the RFM of some of your donors, take a look at our Nonprofit Donor RFM Calculator. Make a copy of it before you enter any data as it’s a public document. Once it’s on your computer, it’s yours.
In this calculator, you will enter your constituents and then assign numerical values for each of the three variables. This will give you actionable insights—a 552, for example, tells you that this donor has given recently (5), gives often (5), and doesn’t give much (2). Perhaps you tell them the tangible effects of a $5 increase on their regular gift. If you have a 444, they might just get a personal thank-you note for being a core donor.
Tracking the RFM of your donors will pinpoint who to ask, for what, and when. That’s nonprofit gold!
Okay, Fine. But How Do I Track All That Data?
No big surprises here. The best way to track every donor touchpoint is with technology. To be more specific, nonprofits should invest in a CRM built for nonprofits. Most nonprofit CRMs will offer reporting and analytics, but you might want to dive a little deeper and see what functionality is off the shelf and what’s available for an added monthly cost. The differences can be significant.
Key reporting and analytic features include giving you the ability to:
- Customize your reports to slice and dice the data any way you want.
- Segment your donors according to any attribute filters you choose.
- Track and measure all engagement, whether it’s them reaching out to you or picking up the phone when you call.
- Measure the fundraising results of campaigns so that you can accurately gauge the costs and benefits to your nonprofit.
- Perform A/B testing on campaigns and have the data to decide the best language, design, or CTA for maximum engagements.
- Manage your volunteers, from knowing who signs up to how much they work and even what happened when you thanked or acknowledged them.
- Extract insights through automated business intelligence that analyzes patterns to highlight opportunities for your nonprofit to grow.
- Scale capabilities according to your growth and needs.
Bug the people in charge of your CRM. If these features aren’t there, see if they’re available for a fee. It sounds a little dramatic, but if you’re not investing in your data reporting and analytics, you don’t actually know how successful your nonprofit is—or how to grow it strategically.
Best Practices for Donor Data
So you know what data to track, why to track it, what you can learn from it, and how technology can help you. We’ve even given you some talking points (or shopping advice) that will help make sure you’re set up for success.
Let’s take a quick look at best practices for data hygiene, or keeping your data current and correct so you can use it.
- Internally, establish governance over your database. Too many hands in the data will make it hard to maintain consistency so your information is reliable and accurate. A trans-departmental committee that collaborates on business rules and policies is a great idea.
- Set a schedule (we recommend monthly) to check for hard bounces (recipients don’t exist, so delete them) and soft bounces (anything could have happened, so send an email asking if they want to remain on your list).
- Dedupe your data! You can merge or delete duplicate contacts.
- Check your data regularly and filter by date of last activity to find lapsed donors. (Hint: reach out to them. They’re easy to re-engage! If you want some ideas of how to do that, give us a call.)
- If you get a new CRM, don’t just do a mass upload of all your contacts. Take the time to do a contact audit, particularly if you haven’t been consistent in your database maintenance.
The Path to Data-Driven Success
It’s not easy to set or follow a growth strategy based on instinct, gut, tea leaves, or a Magic 8 ball (yeah, that dates me. You too if you know what it is). When you stand before your board of directors, a data-driven growth strategy will be unimpeachable. As the data changes, the plan will evolve, and you will remain in lockstep with your donors.
Collecting and analyzing your donor data is one of the most crucial tasks you can undertake, and the results can and should inform every aspect of your nonprofit. Your database is only as good as the data that goes into it, so remember that golden rule as your contacts grow.
Paying attention to the numbers will help you to become an efficient, effective fundraiser. The more effective the fundraising, the more impact you’ll have on the world. And that, of course, is what it’s all about.