Tag: donor management

This article was originally published by Mighty Citizen. An edited version is republished here with permission.

One of my first questions for any new nonprofit client is: How good is your data?

I’m not asking if they have data, but how good is it? As a marketer, I want to build communication strategies that are founded on research and real insights from everyday donors. I want to know what your donors care about, how they want to be communicated with, and what kind of content resonates with them. This information allows your nonprofit to better engage your donors and leads to long-term benefits like increased and repeat donations.

Without data, your communication strategies are likely to be built on gut feelings and opinions. The beauty of data is that it negates opinions. Data can guide us; it can be a beacon of truth in a sea of opinion.

If you’re like most nonprofits, you have data available, but it’s either 1) housed in many different tools, rendering it cumbersome and useless, or 2) limited to basic insights like “total lifetime giving amount.”

Sound familiar?

If so, let’s take a gander at how to collect useful donor data without being annoying. Why do I say “without being annoying?” Because most donors view survey questions as a nuisance, in the way of a task they’re trying to complete, like filling out your donation form.

Option 1: use your thank you page as a data collection point

On your website, your thank you page can be an unbelievably valuable asset if used correctly. After all, your donor feels great about the commitment they’ve just made and is more likely to continue giving—this time, in the form of information.

Often, nonprofits use their thank you pages to say nothing more than “thanks for the donation.” But what if you popped a couple of questions around donor motivation onto your thank you page? For example, you could ask “What motivated your donation today?” and offer up three to five optional answers. You could also offer a text field if they wanted to provide additional info.

Or you could ask “What’s the best way to communicate with you?” Or, if your marketing strategy benefits from it, you could ask their age, what part of town they’re in, or which of your programs they care about most.

There’s a plethora of questions you might ask to help you segment your donors for future campaigns. The thank you page is a great place to get answers.

Option 2: send a quick donor survey

Has your organization conducted a donor survey? Was it short? Probably not short enough.

The inclination is to create a donor survey that allows you to find out anything you could ever possibly want to know about your donors. (Favorite color, everyone?!) You must resist this inclination!

Instead, put a survey link in your donor’s email receipt. Remember, they’re feeling good about that donation they just made. They’re looking for a receipt in their inbox to confirm the donation went through successfully. And now, within that same email, you’re simply asking them to tell you how you might serve them best by answering a short 3-5 question survey that takes less than 2 minutes to complete. Emphasize how quick and easy this survey will be, and make sure it is!

Using this strategy, the survey is not a cumbersome initiative for your nonprofit. It simply rolls out on a continual basis whenever a donation is made. And with a seamless integration of your donor database, you can ask different questions each time the donor gives.

Option 3: ask them during the donation process

I’ll be honest, I don’t like this option as much. That’s why it’s down here at the bottom! This option requires that you include a couple of questions for donors to answer as they’re filling out your donation form (online and off).

I’m hesitant to recommend this to our clients because I never want donors to fill out more than they have to in the process of donating. The less friction in the donation experience, the better. We don’t want them having to think too much. But sometimes—depending on your donation form software and internal IT resources—this is the fastest and easiest route.

If you take this approach, ask questions that might enhance the donor’s experience, like “Which of our programs most interest you?” or “How best should we communicate with you?” This is not the time to ask age or income or any other question that might give potential donors pause. My recommendation is to ask no more than 2 of these questions in your donation form.

Ask questions that might enhance the donor’s experience.

Test, and test again

I’m admittedly biased toward some of these options over others but you should test all of the options to see what works best for you. Test all of the options and see what gains the most traction with your particular donors.

Keep in mind that if you don’t receive a large quantity of online donations, you’ll want to test over a longer period of time to make sure you’ve got enough data to accurately compare your options.

Now, go get your data!

I hope you’re now primed and ready to learn valuable information about your donors so you can serve them better. Not only does this require some forethought, but you’ll likely also need to tap into your IT pro or an outside consultant to set your systems up properly so this doesn’t become a manual burden for your team. But once you’ve got the machine running, you’ll never look back!

With the light still with us to mid-evening and the pumpkin spice barely dusted, it’s hard to think about the negative wind chill and frantic fundraising that is coming in December. But as one of Big Duck’s resident fundraising mavens, year-end campaign season–often dubbed “a nonprofit’s most financially rewarding time of the year”–is always on my mind. So why do I want it on yours? Well, it’s really never too early to get started, and I want to help make it easy—so let’s focus on the tools you already have: your brand and your donors.

Use your brand strategy to guide your fundraising

If you’ve read Brandraising, or attended one of our sessions at the NTC, you know that the heart of your brand strategy is positioning and personality. Positioning is the big idea that you hope supporters associate with your organization. It’s also what sets you apart. Personality is the set of attributes or feelings you want people to associate with your organization. With your organization’s positioning and personality in hand, you can develop or judge different creative themes for your fundraising campaign.

Farra Trompeter quote: By tailoring your approach to the people who already know you, you celebrate how they have helped you accomplish your victories and invite them to continue partnering with you.Because your year-end fundraising should be an extension of your work year-round, these communications should feel like an extension of your usual communications. Yes, your year-end campaign should be special, and this may be a time of year where you invest more time and money into what you send out. But if your year-end fundraising does not sound, look, and feel like you, your current donors may be confused and less likely to give. Use year-end fundraising to accentuate your incredible work and reinforce what they already know– and love– about you.

As you develop the campaign theme and roadmap to connect all campaign elements, don’t forget to start by breaking down your fundraising goals into SMART (Specific, Measurable, Achievable, Relevant, and Time-bound) objectives. Once you have crafted those objectives (download this handy worksheet), it’s easier to hone in on the strategies and tactics that will achieve them.

Appeal to your core donors – and acknowledge them too

Fundraising campaigns typically focus on renewing or appealing to existing donors, reinstating lapsed donors, and/or acquiring new donors. For year-end fundraising campaigns, we often recommend organizations focus first on renewing past supporters, either recent or lapsed, rather than running a major acquisition campaign to get new supporters. That’s because less than one of out of every three new donors renew their support (based on the latest data from Fundraising Effectiveness Project summarized by Bloomerang)–but when they do, they are 15% more likely to keep on giving–so the value of a donor retained can be far greater than that of one acquired.

By tailoring your approach to year-end fundraising to the people who already know you, you celebrate how they have helped you accomplish your victories and invite them to continue partnering with you into the future.

As we enter the season of giving, be sure to give donors other actions to take beyond giving and remember to say ‘thank you’ to all of your supporters. This can be a great time to make phone calls, send handwritten notes, post a video message or thanks, and let donors know that you love them. Not sure what to say on a thank you call? Try this thank you call guide so that staff, board members, and volunteers go into each call with a game plan.

If you do want to acquire new donors through your year-end appeals, consider running a mini-campaign for #GivingTuesday. While some organizations just send out one email on #GivingTuesday, many nonprofits find success sending out multiple emails before, during, and after that day, as well as posting on social media channels and their website. If you acquire new donors on #GivingTuesday be sure to engage them once they give via a welcome series or a more segmented approach in your follow-up communications.

Still hungry for more tips?

My colleague, Ally Dommu, Big Duck’s director of strategy, shares these five high-value tips that you can put in place now and test before year-end season.

(This article was originally published on Nonprofit Tech for Good and is reprinted here with permission.)

Currently only nonprofits in the United States can take advantage of Facebook Fundraisers. This is frustrating to many NGOs, charities, and nonprofits located outside of the United States, but it’s due to the fact that the United States has a database of nonprofits called GuideStar USA that Facebook can sync with theirs to easily verify a nonprofit’s legal status. Facebook is likely working on expanding their fundraising tools to the United Kingdom and Canada where other such databases exist and eventually (hopefully, finally) a similar database will exist on a global scale (perhaps the BRIDGE Registry or the OnGood Global NGO Directory).

All that said, any Facebook user can now create Facebook Fundraisers for nonprofits listed in the GuideStar/Facebook database which currently numbers around 750,000. For details about Facebook Fundraising Tools and for information about how donations are distributed to your nonprofit, please see: nonprofits.fb.com/topic/fundraising-tools.

Facebook currently has 1.94 billion monthly users. Empowering your supporters to fundraise for your nonprofit inside an online community where they already connected to their friends and family is smart strategy. At the very least, the tools are worth experimenting with.

1. Verify your nonprofit is in the Facebook Fundraiser database.

Go to facebook.com/fundraisers and search for your nonprofit. If listed, your supporters can create Facebook Fundraisers for your nonprofit. Sign up for Facebook’s Fundraising Tools if you want access to daily fundraising reports.

2. Update your Facebook Page Cover Photo.

Your cover photo will be the default photo for the Facebook Fundraisers created by your supporters.

3. Create a “Day of Giving” Facebook Event.

Give your nonprofit four to six weeks to promote your Facebook “Day of Giving” campaign. In the Facebook Event, list the ways that your Facebook Followers can give to you on this day and how they can create a Facebook Fundraiser for your campaign. Then, post your event to Facebook and pin it to the top of your page.

4. Promote your Facebook Event on your website, in your email campaigns, and on social media.

The Humane Society of the United States is an organization regularly in the habit of early adoption of new social media tools and trends. They created a landing page on their website for their “Day of Giving” campaign that is easy to promote online. Study and learn from HSUS: humanesociety.org/dayofgiving

5. Thank your Facebook Fundraisers and donors.

You can’t post a “Thank you” comment as your page on Facebook Fundraisers. If you have a staff person willing to use their personal profile, then your fundraisers would appreciate the acknowledgement. You could also post a link in your Facebook Event where they could sign up for an email list so you can thank and engage them via email. Also, if your nonprofit has signed up for Facebook Fundraising Tools, in daily transaction reports you will receive the email addresses of your donors if they have opt-ed in. Create a system to email and thank them immediately!

It took me three months into my social media dream job to realize why the word “online” was part of my job title. It was 2010, and I had finally found a job that had social media marketing at its heart, at a small AIDS nonprofit that planned to use Facebook, Twitter and dating apps to connect with people living with and at risk for HIV.

Even before my first day, I’d had a run-in with our horrible, outdated and very difficult website, but I knew there was a web developer on retainer and I figured it was his problem. Or maybe it was the Executive Director’s problem. Or perhaps the office administrator. I don’t suppose there was someone on the board who could help? A volunteer? Bueller?

As anyone who works in digital marketing or fundraising knows, your organization’s website is at the crux of how people relate to your organization and its work. When something is wrong, it hurts your ability to attract, engage, and convert the people you need to make your work a success. As it turned out, our website was my problem, and to solve it, we needed to build a working digital strategy.

What is a digital strategy?

For many nonprofits, technology adoption isn’t hard. We’re smart people, and we’re perfectly capable of finding the tools we need to help us perform particular tasks. But what often happens is that an organization will accrue a slew of tools, all of which maybe do what they should perfectly, but still aren’t getting the results that you need them to. Perhaps your content strategy is bringing scores of people to your website but you aren’t capturing them in your email list for fundraising campaigns, or you’re gaining lots of Instagram followers but none of them know about your online forum. A good digital strategy will knit your tools and aspirations together into a cohesive plan to meet your goals.

We’re here to help. NTEN is producing two conferences this fall—in New Mexico and Oregon—and both are designed to help you develop and refresh your digital strategy. The program includes case studies, workshops, panels, presentations, and tactical sessions, to help you formulate the best strategy for your organization, and show you how other nonprofits have done it.

That seems like a big task. Where do I even start?

I am a people person and NTEN relies on members to survive, so I like to start with personas. What are the groups of people that want to engage with your organization, how did they find you, what do they want to know, how do they want to engage, and what do you most want them to do? Plot their journey from an unconnected community member to engaged part of your inner circle, donor or member. What’s their ideal journey? What roadblocks are in the way right now? How can you clear them?

Identify the top handful of actions you really want your constituents to take—for example, donate, advocate, join or inform others—and consider the technologies they need to do that easily. Find data that can tell you how you successfully moved them to that action (or “converted” them, in marketing-speak). How many touch-points do you need? What’s the story to tell them, and where and how is it best told? Which are the channels that net you the most success, and why do you think that is?

Like me, when I finally realized the website monster was mine to tame, you will have a lot of questions. But it’s only through considering the (sometimes difficult) questions that you can build a digital strategy, pulling together your organization’s disparate parts and making them work better, for you and the communities you represent.

Best of luck! We hope to see you in the fall.

Our giving programs are most successful when we know how and why our donors give. But what are the best ways to collect and store these data in a way that is accessible, actionable, and cost-effective?

NTEN and Idealware have partnered to produce the 2017 Consumers Guide to Donor Management Systems, which reviews a number of low-cost systems against a list of criteria.

Download the report.

Idealware is hard at work building the next edition of the Consumers Guide to Donor Management Systems. NTEN and Idealware are partnering to produce this report, which means that NTEN members will get early access to the report in February, about a month before its general release at the 2017 Nonprofit Technology Conference.

This report is free to the nonprofit technology community and offers a review of low-cost donor management systems against a list of criteria, helping readers make comparisons and investigate which system might best meet their needs.

As in past editions, the 2017 report will also include a resource directory to help readers find consultants who can help them with product selection and implementation, vendor contact information, and other fundraising-related services.

Some of the highlights from our early research:

  • More systems than ever are hosted in the cloud.
  • Subscription pricing is shifting toward the number of donors rather than the number of users. Some view this as a trend toward commoditization.
  • User interfaces are improving at all levels. Even very low-cost systems are investing in making their systems easier to use—especially on the web.
  • Low-cost systems are putting more emphasis on automated workflows and business rules that allow you to assign tasks or reminders based on donor actions.

We have a lot more to share with you when the report is complete, so stay tuned. This is our most popular report and for good reason—it helps you narrow down your choices to the handful of systems that will best meet your needs.

And if you are a vendor or consultant serving the nonprofit sector, you’ll want to be included in this directory! By purchasing a directory listing, not only are you helping to make this critical resource possible, you’re also getting your name in front of an audience that is eager to learn about what you have to offer. If you have questions, contact Eileigh at eileigh@nten.org or (503) 272-8744.

A new year presents new opportunities to assess and grow your individual fundraising program. Do you know how your nonprofit compares to similar organizations? Where do you excel or where do you hope to grow?

Focusing on nonprofits with revenues under $2 million, the Individual Donor Benchmark Report is back again with fundraising data for small and mighty nonprofits.

Among the report’s findings are:

  • Organizations raise 34% of their revenue from individuals.
  • About half of individual donor revenue comes from donors giving less than $1,000.
  • One out of every five individual donor dollars is raised online.
  • Four out of ten board members are active in fundraising in a significant way,
  • Organizations are raising about 14% of their income from recurring donations.

The report also found that the average organization’s donor retention rate is 60%, meaning that 6 out of 10 donors give again—and 4 out of 10 donors don’t.

If your organization has a donor retention rate around 60%, you may be asking yourself two questions:

  1. How can we increase retention?
  2. How can we find more new donors to replace the donors we are losing each year?

Here are a few tips to help you think about how to answer those questions:

Increase Donor Retention

If you want to increase your retention rate, the best strategy is to view your individual donor fundraising program as a relationship development program. Your goal should be to build a relationship with your donors, where part, and only part, of that relationship is about their financial support for the organization. Here are a few ways to shift your focus to your relationship:

Consider your organization from a donor’s perspective.

Even when we are doing many things to communicate with and engage donors, sometimes there are holes in our plan. One way to find these holes is to walk through the experience that different types of donors have with your organization. What happens when a new donor makes a $25 gift? $2,500 gift? What happens when someone gives online? What is the experience for a $50 a year donor? You may find that with a little intentionality you could be doing a much more effective job of engaging your donors with your work.

Remember what you learned about your donor.

As a development director, I learned to listen carefully in major donor meetings and record what I’d learned after the meeting for future cultivation and solicitation. While this kind of attention is standard procedure for major donors, there’s an opportunity to use some of the same ideas with everyday donors. As your donors click on links in your emails, respond to direct mail solicitations, or attend events, they are giving you information about what they are interested in. If you are diligent, you can capture that information and begin to develop a picture of your donors. Organizations can also survey donors to gather information about their interests and use that information to tailor solicitations.

Thank donors seven times before you ask them again.

This advice has been around for a long time, but I still get surprised looks and big sighs when I share it. “Seven times?! How could we possibly do that?” First of all, it’s a guideline—but the real point is that you should not treat donors like ATMs, only coming to them when you need money. You should be in touch year round to share the results of their donations (and your work) and to thank them for their support. These thank yous don’t need to generate a lot of extra work. Think about content that you are already producing that could be re-purposed as a donor thank you: annual reports, updates for the board, or grant reports.

Find New Donors

You may be able to increase your retention rate, but you will likely also need to focus on finding new contacts and developing strategies to convert them to donors. One powerful framework for thinking about cultivating new donors is the cycle of engagement. The cycle includes the following components and questions:

  1. Opening the door to potential new donors. How do you find new potential donors? How do you collect contact information from potential donors? What have been the best ways for you to find new donors in the past?
  2. Thanking and tracking new contacts. How are you communicating with donors after they first meet your organization? Do you have a welcome series to introduce your organization? What information about them are you tracking in your database or other places?
  3. Engaging supporters. How can you help people experience your work? It may be by participating in programs, volunteering, or viewing a video about your efforts. How can you increase the opportunities for supporters to engage with your work?
  4. Thanking and tracking engaged supporters. How are you communicating with supporters after their engagement with your work? What engagement data points are you tracking?
  5. Asking for a donation. How can you tie your ask into the way you first met them and/or the way they have been engaged with your organization.
  6. Thanking and tracking donors. How do you thank a donor? What information about their gift do you need to record in your database? After this step, go back to #3 and repeat indefinitely!

The best way to ensure your organization is continuing to find new donors is to involve everyone (board, staff, and volunteers) in identifying, cultivating, and asking for support.  Even for those who have an aversion to fundraising, getting involved in opening the door, engaging, and thanking donors can be a fun way to help the organization grow its donor pool.

For more donor fundraising details and data, check out the full Individual Donor Benchmark Report

Many nonprofit organizations have already caught onto the fact that implementing a membership program can incentivize more donors to give to their organization. After all, the very nature of membership programs is incentivizing. When becoming a member, donors receive certain benefits or perks in exchange for making donations in the form of membership fees or dues.

The problems lies in that fact that, instead of focusing on keeping the members they already have, many organizations turn the majority (or even entirety) of their focus onto gaining new members. However, this is a big mistake. It’s much more cost effective for your organization to put your resources toward member retention than it is to put them toward member recruitment.

Think about it: you’ve already successfully convinced your current members of the worthiness of your cause and the value of your membership program. That means it will take far fewer resources to get them to give again! Take advantage of your donor database or association management software to gain insights into what your members want (and if you want to learn more about membership and association software, check out Neon’s guide).

In this article, I’ll focus on 4 best practices that can help you win members for life.

1. Choose the most appealing benefits.

Why it works:

The reason membership programs are such an effective fundraising strategy is because they incentivize your supporters’ donations.

These types of programs are incentivizing for two main reasons:

  1. Benefits. Membership programs provide specialized benefits to the donors who join them. These benefits can range anywhere from a welcome packet that includes branded merchandise to internal influence at your nonprofit. Membership benefits provide donors with exclusive opportunities to engage with your organization in the ways that are most meaningful to them.
  2. Exclusivity. Since not all donors will receive member status or perks, donors will feel like they’re joining an exclusive club. Having exclusive access to your organization can really make members feel especially valued!

For your membership program to reach its full motivational potential, it’s important to choose the perks that will most appeal to your members. You should be offering the benefits and opportunities that meet donors where they are and best speak to how they ideally want to interact with your organization. If current members feel like they’re being understood and like they’re gaining something valuable from your program, they’ll be much more likely to renew once expiry rolls around.

How it’s done:

To figure out which membership benefits your supporter base will find irresistible, turn to your donor data. You can analyze your supporters’ past interaction history to figure out which benefits might appeal most to your base.

If your organization is notorious for its fundraising events and always sees a higher volume of donations when interacting with donors in person, you might consider offering event-related benefits through your membership program. You could give your members VIP access to your annual fundraising auction (think: better seats, free refreshments, etc.) or invite them to conferences and trade shows that non-members wouldn’t have the opportunity to attend.

All it takes is knowing a little bit about your donors’ habits and preferences and meeting them where they want to be met.

In summary: Membership programs that include the benefits and perks that most appeal to supporters’ interest will foster the highest retention rates.

2. Personalize your outreach.

Why it works:

Perhaps the biggest key to member (and donor) retention is personalizing your outreach. It’s true that your members are united by your organization’s common cause and are likely motivated by similar incentives (they were all inclined to join your membership program, after all!). 

However, each member still has unique preferences, habits, and concerns. They all want to hear from your organization through different communication channels, and they all want to engage with your organization in different ways. The more you can cater your outreach to each individual donor based on their habits and preferences, the more relevant, and thus, compelling your outreach will be.

Taking a personalized approach to your outreach shows members that your organization is invested in them as individuals, not just in the funding they can bring in. When members know that you’re interested in building deeper relationships with them, they’ll feel more valued by your organization and be more inclined to stick with your program.

How it’s done:

This is where your donor database or association management software will come in handy. You can use your member profiles to start creating individualized outreach strategies for each member.

  1. Use the member’s name. While using your members’ names in the salutation of your outreach might seem obvious, you’d be surprised at how many nonprofits still use a generic greeting like “Dear member” or “Dear friend.”
  2. Pinpoint communication preferences. Looking back on past interaction history, you can get an idea of which communication channels each of your members is most responsive to.
  3. Find further opportunities for engagement. I’ll go into this more in the next point, but analyzing past interaction history can also give you insight into which additional engagement opportunities might appeal to your members.

Using any of the data fields you have listed in the platform, you can segment your list to better target your member base with individualized content.

In summary: Sending personalized communications ensures that your outreach is relevant and that your members will always feel valued as individuals, both of which lead to heightened member retention.

3. Offer plenty of engagement opportunities.

Why it works:

One of the great things about membership programs is that they provide you with a built-in structure for reaching out and engaging your supporters. After all, you’ll have to administer the benefits of your program to your members.

Some membership programs have a more hands-on structure than others. For example, an advocacy-based membership program that provides members with a guided structure for taking political action might provide plenty of active engagement opportunities (signing petitions, attending rallies, writing to legislators, etc.). However, a community-based membership program that centers on offering its members access to exclusive facilities, classes, or services would rely mainly on the member initiating interaction with the organization.

It takes frequent interaction with your members to keep them invested in your organization. And the best way to do that is by presenting further opportunities for engagement that go beyond the scope of your program.

Providing members with frequent chances to interact with your organization:

  • Can help them feel like they’re getting maximum value out of your program.
  • Always keeps your organization and the great work you’re doing fresh on their minds.
  • Makes them feel more connected to your cause and work.

All of these factors will increase the chances that current members will renew.

How it’s done:

Using the insights you’ve gleaned from studying your members’ past interaction history with your organization, you can scope out other engagement opportunities that might appeal to their interests.

Here are some of the additional opportunities you could provide:

  • Sharing exclusive news and/or content.
  • Inviting members to events, conferences, or trade shows.
  • Seeing if members would be interested in volunteering.
  • Having members take advocacy-related actions, like signing petitions or writing to local leaders.
  • Asking members to participate in peer-to-peer campaigns.

These opportunities don’t even have to be exclusive. They can certainly be opportunities you’re offering to non-members as well. The important thing here is to find the opportunities that are most likely to engage your members further and to provide them on a regular basis.

In summary: Providing members with frequent opportunities to interact with your organization outside the scope of your membership program will ensure that they always stay engaged. Engagement leads to investment, which in turn leads to renewal.

4. Make renewal easy.

Why it works:

People are increasingly motivated by convenience, especially in a day and age where depositing a check or ordering a meal can be done with the mere click of a button. To foster the highest member retention rates, your organization should aim to make membership renewal as convenient for your members as possible. The easier and shorter the process for membership renewal is, the more likely your members are to follow through.

How it’s done:

Luckily, making renewal easy on your members will be easy for your nonprofit, too.

With association management software (the type of software that was especially built to help nonprofits facilitate their membership programs) you can add the option to set up recurring renewal right on your online membership formTo renew their membership, all members will have to do is to check off this box when they’re filling out your form. You can even provide them with multiple renewal options (one year renewal, two year renewal, multiple membership tiers, etc.), so they’ll have the flexibility to choose what’s most convenient for them.

By setting up this option, renewal will be automated for both your donors and your organization. Your software will automatically charge the payment method you have listed on file once it’s time for membership to expire.

In summary: Your members will be more inclined to renew when doing so is straightforward and convenient. Set up automated renewals through your association management software to make the process easier on both you and your members.

Bonus: Convenience is key: learn more about building a successful landing page.


Increasing your membership renewal rates will take some effort, but it’s certainly not something that’s too difficult. To keep your members coming back, all it takes a thoughtful approach to structuring your membership program and reaching out to your members. Do that, and you should have a base of members who are loyal for life.

 

Image credit: paulaphotos

Most nonprofits make use of technology to manage donor information, fundraise and collect donations, and track results. However, the technology used varies dramatically, from simple spreadsheets, to robust, all-encompassing, donor management products.

According to data reported in the 2016 Lehman Reports™ study of Donor Management Systems, nonprofit organizations using custom systems and office applications are only about half as satisfied with their solutions, when compared to those using Donor Management Software (DMS) products.

Average satisfaction levels for donor management products are 6.1 on a 10-point scale, modest but unchanged from 2014. In contrast, satisfaction ratings for custom systems and office database applications are just half of that at 3.7 and 3.0, respectively.

These satisfaction ratings are reflected in success metrics. Only 48% of organizations using custom and office database solutions report year-over-year contribution increases, compared to 58% of organizations that are using a DMS product. The rate is even worse for organizations with no solution at all.

Contributions Chart

What’s Behind the Numbers
What accounts for such dramatic differences in satisfaction numbers? Several possibilities come to mind.

First, staying abreast of technological change is a challenge for everyone, but it’s nearly impossible for part-time developers to keep pace. If you’re organization is trying to cement bits and pieces of a solution together, you’re likely missing out on the latest technologies and new feature advances available in the leading software product.

Keep in mind, too, that technological change is exponential. So, “keeping up with the Joneses” is likely to get harder and harder with every passing year.

Second, the online fundraising capabilities that are in greatest demand likely are the very capabilities that are not available in an office database and that are hardest for small, or part-time custom shops to develop. It is challenging even for large product providers who can invest significantly in ongoing development. Going it alone can be a very difficult endeavor.

Finally, it is increasingly important that applications share data to support fundraising and donor engagement, and much of that takes place across online applications. Local databases and most custom systems are simply not up to the task.

What to Do
The simple answer is to consider moving from a local database application or custom system to one of the available donor management products. By doing so, you will gain immediate benefits and will be investing in your own future. Software companies have a great incentive to continue to incorporate new technologies and capabilities in order to compete successfully in the market. Additionally, advanced online capabilities give software companies the greatest competitive edge, so it’s likely that those developments are a high priority.

Plus, you’ll be in very good company.

There is a very clear trend away from home-grown systems toward DMS products, in the market today, with only about 35% of non-profits planning to stay with their home-grown systems.

DMS Retention Chart

Is it time for your organization to make the move to a DMS product? Every organization is different, of course, but it’s becoming more and more clear that if you’re still nursing along a home-grown solution, you are likely to be operating at a competitive disadvantage, and time and market trends are definitely not on your side.

We all know in this day and age that technology plays an increasingly important role in fundraising, as it does in many other aspects of our lives. As someone who works in implementing technology for nonprofits, I am passionate about the enormous benefits that the right technologies can bring to nonprofits. If chosen and implemented correctly, technology tools can make a nonprofit more efficient, effective, and increase impact.

While working with our nonprofit clients, I consistently come across some persistent traps that I see nonprofits fall into when choosing and implementing technology. These traps can be avoided.

Free Is Best

Nonprofits tend to be very price-conscious because of their budget limitations. But looking at price only ignores many important factors in making a decision about the best technology solution. Nonprofits often make do with whatever is donated or free. Free does not mean it is the right or the best technology tool for a nonprofit.

Before bringing in new free technology, a nonprofit needs to develop requirements for what is needed from the new technology and use that lens to vet available products. By bringing in free or really low cost technology, primarily for its price point, a nonprofit ends up with technology that does not meet its needs, and staff end up taking a lot of their precious time trying to make the technology work. If requirements are figured out early, followed by an assessment of available technology products, putting together a plan to raise the funds to pay for the technology will be easier. You’re a fundraiser, after all, and there are many foundations and other funders who understand the importance of the right technology and are willing to invest in technologies that produce greater results.

The Shiny Object Syndrome

Choosing a new technology for fundraising can be overwhelming. Most development staff don’t have a degree in computer science or an understanding of inner technical workings. However, they know what needs the technology must meet. They start a search for the best system for their fundraising needs and—lo and behold!—they contact a vendor who sets them up with a slick demo of their tool and says all the right fundraising buzz words. As they quickly click from one item to the next in their cool-looking user interface, staff will likely come back enthused about the product and ready to implement it.

I’m going to let you in on a secret: It is relatively easy to do some sleight of hand modifications for a demo that makes it appear that your tool does what the customer wants. Couple that with some impressive marketing materials that mention all the key terms, and it is easy to be sucked into thinking this is the product you need. It is so much easier to go back and sell it to your Executive Director and board if you can show them a sophisticated looking presentation. You buy this amazing technology tool, implement it, and then discover it really wasn’t what you thought you were purchasing.

Do not fall into the trap of being dazzled by a slick demo! You need to do your due diligence in evaluating technology products. Ask to take the system for a test drive. Many tech products offer a free trial where you can get in and get hands-on with the product. Check references with other nonprofits using the product that have similar needs to yours to find out how it is working for them. It’s important that you do not dismiss tech products just because they don’t have a fancy demo available. The lack of a fancy demo does not mean it isn’t a solid product.

The System Won’t Run Itself

I see time and time again, nonprofit clients who make a significant investment in a new technology, but when I ask who will be their system administrator once we launch, I get a blank stare. There seems to be a perception, in many cases, that the system will run itself. While newer technology can do a lot of amazing things to free up staff time, it does still need someone whose job is focused on making sure the system is being used properly, that staff (including new hires) are well trained in the use of the system, that you’re keeping up with the newest releases coming out, and that things are working properly. Some clients just decide to give all users system administrator privileges thinking that will solve the issue. I cringe when contemplating the ensuing chaos and lack of accountability that could result from this line of thinking.

A good system administrator (who isn’t wearing another 10 hats at your organization), will ensure that you maximize your investment and get the best use of your new tool. Don’t spend a bunch of money to implement a new system only to have it fall into disuse because no one is keeping it up.

Special Snowflake-itis (We All Have It)

In working with clients, I often come across a perception that the development department’s needs are very special and therefore, they need their own technology system that only they can access. There are several dangerous assumptions packed into that belief. By having a separate database from the rest of your organization, you are not able to get a 360-degree view of your constituents. There is often an assumption that donors are a separate and distinct constituent type for your organization, but it is rarely the case that at least some of them don’t have other interactions with your organization, such as volunteering or participating in your programs. The donor doesn’t see him- or herself as only a constituent for the development department. A donor views him- or herself as a supporter of your entire organization. By segregating a donor into a separate system, your organization risks not being coordinated in your asks to them and not fully understanding their interests and motivations.

The other danger in this assumption is that the development department needs to only concern itself with knowledge of its donors. By putting all your data in one system, your development staff then has a clearer window into the work of the rest of the organization. This will strengthen their fundraising toolkit.

Sometimes this belief in the need for a separate database is born from fear that other staff may see giving data that should be private. Many databases allow you to set up architecture to prevent staff from seeing data that they should not have the access to view. There are also fears that other staff won’t enter data using the same standards as the development department, but that is easily overcome by choosing a system where you can enforce data entry standards. Properly training all staff who will be entering data also reduces data entry errors.

I believe the benefits of an integrated system for all departments far outweigh the risks. Implementation of a shared database goes a long way to getting staff out of their siloes and working with a clearer view of your constituents and the work you’re accomplishing.

 

Choosing the right technology for your organization is key to being an effective fundraiser. As technology plays a larger and larger role in our lives, ensuring that your organization prioritizes investing in and implementing the best technology is critical to a nonprofit’s success. While this can require a significant investment up front, if done correctly, it will pay dividends for your in the long run.

Photo credit: Amy Snyder