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Get to Know Your Donors: 4 Tips

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A guest post from Sarah Tedesco of DonorSearch

donors at the center

Donors at the heart

Each year, you and your fundraising team work hard to raise money for your cause and make a meaningful impact on your mission.

In the center of all your hard work are your donors, the people who genuinely believe in your cause and take the time and action to support your nonprofit.

It’s more cost-effective and beneficial to retain donors than acquire new donors, so focus your efforts on developing those current donor relationships. And the right tools can help.

Even though fundraisers are now equipped with amazing tools, you still have to learn the best ways to use these modern solutions to build truly authentic relationships. The better you know your donors, the stronger your relationships will be.

In this guide, you’ll be learning about the best ways to get to know your donors and the tools you can use to truly understand why donors give to your organization. Consider these top tips:

  1. Ask donors for their preferences.
  2. Record all donor data.
  3. Invest in a prospect research tool.
  4. Incorporate donor data into marketing initiatives.

1. Ask donors for their preferences.

In order to foster relationships with donors who continuously support your cause, it’s good practice to determine their engagement preferences at the start. This can be as simple as asking them to check off a box in your donation forms!

The more personal and targeted your fundraising engagements are, the better your donors will respond to your outreach efforts. For instance, say a donor doesn’t want any direct mail sent to their home address. Once you know this preference, the worst thing that you can do is to continue sending materials and physical letters. They’ll just get annoyed with the barrage of mail and start to ignore your engagements.

Ask your donors’ preferences on your online donation form. This way, you can record these preferences in their donor profiles right off the bat. It’s also a good idea to let them change their preference as your engagement continues. You can include a link in your email signatures for easy access.

Make sure you keep track of these preferences:

  • Do your donors want to receive email communications, direct mail, mobile text messaging, or all?
  • How often do your donors want updates? Do they want to subscribe to your newsletter?
  • What kind of communications do they want to receive? Event invitations, volunteer opportunities, or donation request letters?
  • If they opted to give a recurring donation, what is their preferred payment preference?

Once you actively make an effort to meet your donors’ preferences, it’s more likely that they’ll stick around and your retention rates won’t stagger. The best place to keep track of all these preferences is your donor database.

2. Record all donor data.

To truly reach your donors and build life-long bonds, ensure that you’re recording all the important donor data. This will depend on your constituent relationship management (CRM) system, also known as your donor database. 

Your CRM system should be recording every donor engagement and all key donor metrics in relation to your nonprofit organization. This means every email sent, every donation given, and each fundraising event ticket sold.

Investing in a capable CRM system is crucial in order to get a comprehensive view of your donors. Once you know their current relationship with your nonprofit, you can better ascertain the ways to improve your future engagement strategies. For example, if you notice that a lot of your donors are active on social media, maybe consider investing more time in that engagement channel.

How do you know if your CRM is doing the best it can for your nonprofit fundraising? Consider its integration capabilities. When the tools within your entire fundraising system are integrated with your CRM, you ensure that your donor data is centralized and accurate. Even as actions and engagements are happening in real-time, the information seamlessly flows into your CRM.

Make sure you’re receiving data from these key fundraising tools:

  • Online donation tool. Ensure your CRM captures the donor name, key financial information, donation amount, and any other information that was required in your form.
  • Event registration tool. If your nonprofit often hosts events, ensure that your CRM records data regarding event attendance, registration level, payment preference, and more.
  • Email marketing tool. Make sure you have all the essential information to communicate effectively with your donors. For example, as soon as a donor makes a gift, your CRM should keep track of their email and send them an appreciation email thanking them for their contribution with that donor’s name and donation amount. Additionally, track which emails are opened and which are ignored to know which engagements are working.

3. Invest in a prospect research tool.

Prospect research is a fundraising strategy that involves screening your donor database to identify high-impact donors. 

While it’s possible that prospect research can be done manually and in-house, the efforts and resources your staff will use up might not be worth it. Many modern fundraisers turn to a digital solution to help. With a capable prospect research tool, you can effectively screen your donors against the nation’s largest philanthropic databases.

To determine which of your supporters are likely to be high impact donors, your prospect research tool is looking out for wealth markers and philanthropic indicators:

  • Wealth markers provide a clue about your donors’ capacity to give. Your prospect research tool is looking at your donors’ real estate ownerships, stock ownerships, and business affiliations.
  • Philanthropic indicators help determine how charitable your donors are and their affinity to give. Your prospect research tool is looking at your donors’ past giving, political giving, and other nonprofit involvement.

Your prospect research tool is great at highlighting donor metrics that you can incorporate into targeted and high-impact marketing initiatives. Donors with both wealth markers and philanthropic indicators are likely to want to give and have the means to give. Read on to learn how you can leverage this information to increase fundraising.

4. Incorporate donor data into marketing initiatives.

Major gifts make up a large percentage of your revenue, with 76% of yearly giving coming from only 4% of donors. Because your prospect research tool is screening for both a donor’s affinity to give and capacity to give, this tool can accurately highlight those who might become major donors.

Identifying your major donor prospects doesn’t mean that they’re automatically going to make large gifts. You need to cultivate this relationship and set the stage for future giving. Your best bet is to segment these potential high-impact donors for targeted communications and other meaningful engagements. For instance, segment these donors and:

  • Give them event perks like early-bird registration or a discount code.
  • Consider writing a handwritten letter instead of an email for a more personal touch. Make sure to keep in mind their communication preferences!
  • Other non-ask communications like interesting nonprofit announcements, upcoming events, and volunteer opportunities.

Not only can your prospect research tool identify potential major donors, but it can also supplement other fundraising efforts.

Increase your corporate matching gifts.

Corporate matching gift programs are great opportunities for nonprofits, but are not taken advantage of as often as they should. Eligible donors can double or even triple their donations if they just submit a matching gift request. According to one study, an estimated $4-7 billion in matching gift funds goes unclaimed per year.

Corporate matching gift programs aren’t as well known as other fundraising initiatives, so often donors don’t even know that they can increase their gift without giving any additional funds.

Using your prospect research tool and a corporate philanthropic database, screen each of your donor’s business affiliations. Then, send out specific matching gift letters to let them know of their eligibility! For a list of matching gift letter templates from a wide range of organizations, click here.

Target donor advised funds.

Another way you can leverage your prospect research data in smart ways is to look out for donor advised funds (DAFs). As stated in this DonorSearch flash class webinar, DAFs are the fastest growing form of philanthropy today.

A DAF account is a dedicated savings account for charity where an individual will deposit cash, stock, or other assets. However, the donor doesn’t choose a recipient right away and instead makes this decision later on.

Finding out one of your supporters has a DAF is an exciting opportunity for your nonprofit. The supporter has already dedicated these funds to charity, it’s just up to you to convince them that your organization is the right one.

Use your prospect research tool and highlight donors who might have DAFs by screening their wealth metrics. Segment those donors and start fostering those relationships to increase the likelihood of them choosing your nonprofit as their DAF recipient. Focus on non-ask communications so they know that this relationship isn’t purely based on them giving you money.

Getting to know your donors is one of the most important jobs for your fundraising team. After reading this guide, you now know how to effectively reach them and can genuinely develop those donor relationships for future engagement. Good luck!

Sarah TedescoSarah Tedesco is the Executive Vice President of DonorSearch, a prospect research and wealth screening company that focuses on proven philanthropy. Sarah is responsible for managing the production and customer support department concerning client contract fulfillment, increasing retention rate and customer satisfaction. She collaborates with other team members on a variety of issues including sales, marketing and product development ideas.

TY Thursday: What Your Nonprofit Can Learn from My Guest Bloggers

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How is your nonprofit like a guest blogger on Communicate?

Answer: You both have to put your audience before yourself.

How Guest Bloggers Succeed on Communicate

Amy Hufford

Amy Hufford

Laura Rhodes

Laura Rhodes

Tripp Braden

Tripp Braden

 

 

 

 

I don’t let just anybody post on the Communicate blog. It doesn’t matter how big a name they are or how long they’ve been in the field. What matters is that they serve readers like you: small- to medium-sized nonprofits that want loyal friends and donors.

Amy Hufford, Laura Rhodes, Tripp Braden, Brock Klinger, James Gilmer, Sybil Stershic, Tripp Braden, Rebecca Thompson, Lisa Dunn…all of these writers took the time and effort to do three things:

  1. Send tailored posts. Guest bloggers didn’t just grab something they’d written and chuck it my way. They came up with a topic and an approach that would interest my readers.
  2. Do the homework. They looked at other posts on the blog, figured out what you, the readers, like to see, and they wrote something like that.
  3. Be unselfish. Yes, of course we all know that the guest bloggers would like you to look at their websites too, and possibly to buy their products or services. But they thought about you first.

This Thank-You Thursday, I want to thank my guest bloggers. But more than that, I want to suggest you, the nonprofit organization, can follow their example.

Write For Your Donors, Not Just Yourself

This sounds obvious, but too often we forget: your donor has something valuable to give you.

I can only give space on this blog. Your donors give your nonprofit its lifeblood, the money it needs to keep running.

Or they don’t. Your donors can say no.

What do you need to do in order for them to say yes? The same things that bloggers do when they want me to say yes to their guest posts!

  1. Send tailored communications to your donors. Write first and most often about what they want to know–not what you want to tell them.
  2. Know your audience. Do research to find out who they are and what they care about. Segment your list so that you’re sending messages about housing to people who care about homelessness and messages about food banks to people who care about hunger.
  3. Make the donor the hero.
    • “We do great work” is selfish.
    • “We do great work with your help” is selfishness in a thin disguise.
    • “You do great work. Keep on doing it with your donation” is putting your audience before yourself–and paradoxically, that is what will benefit your nonprofit the most!

Learn from my guest bloggers: what they say, but more important, what they do. Put others first if you want them to help you.

Fundraising Tuesday: Should Your Nonprofit Have Members?

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Amy Hufford

Amy Hufford

A guest post by Amy Hufford of MembershipWorks

In a time where people spend more time isolated in front of a screen than interacting with other humans, isn’t the idea of membership a more interesting and compelling proposition?

Just about every type of nonprofit can have members. Think about public radio and television stations. You might consider their contributors to be donors, but calling them members adds meaning.

Memberships add value for donors

Some public television and radio stations have made donors feel more like members by holding events.

  • KLRU, Austin’s public television station, has created premium member events such as Downton Abbey watch parties.
  • They also offer member only access to PBS’s Passport product, which is essentially Netflix for public television programming.
  • NPR affiliate KUT has created a leadership circle sustaining membership that offers members special event invitations, tours and the opportunity to meet famous personalities.

But even if a nonprofit does not host in-person gatherings of members, the suggestion of community is psychologically attractive. It’s a benefit to the member!

What’s in it for you: increased revenue, stable budget

There are real financial reasons for your nonprofit to have members. Membership is understood to be something that is renewed on a regular basis, implying more of an ongoing relationship than a donation suggests.

Consider a donor inspired by your mission who wants to donate $50. But what if you presented an ongoing option, such as a $10 per month sustaining membership that is promoted as “the cost of one lunch each month.” That offer will collect $120 over the course of a year (and even more, if the member doesn’t disable their monthly auto-recurring credit card payments the next year).

This is also a win for budgeting, as these types of memberships can help the organization better predict monthly fundraising income.

How to move toward memberships

  • Be sure your donation platform offers membership management software.
    Why do you need specific software to handle memberships? You’ll need the ability to:

      • Automatically bill members on an recurring basis
      • Classify members in different ways to keep track of their involvement
      • Set up multiple past due notices and failed payment reminders in your member CRM, to account for today’s distracted members. (The notices should mention the things that the members will miss out on if they don’t renew!)
  • Check to be sure your payment gateway is set up to accept auto-recurring payments.
    For example, PayPal Pro requires an add on to handle automated member billing. Stripe handles recurring payments by default.
  • Create membership levels or add-ons.
    You may be surprised by the number of people who pick a higher level, given the chance! Consider how you are going to create value for each level of membership. The benefits package should justify the increased cost of higher priced memberships.
  • Promote your new membership levels
    To help them feel special, your current donors and volunteers should be offered the opportunity to join as a member before you promote membership to others.

      • You can even offer a discount code to encourage them to join.
      • Spread the word about memberships on your website, enewsletter and social media.
      • Consider holding an event to either kickoff your membership drive or to reward those who join by a certain date.

The magic of membership

magicHere’s a success story that might encourage you to invite donors to become members.

One neighborhood association had a PayPal button for dues payments on their website, but no one was automatically reminded to renew. The association was running out of money. After they set up membership software with automatic recurring credit card payments, the association quickly doubled its renewal rate.

The board of directors were also shocked to see that many members opted to make significant additional recurring donations beyond their dues payment. These donations made it possible for the group to prevent commercial development from negatively impacting the neighborhood. Making the shift from single donations to membership payments with add-ons possibly saved the association from extinction.

More ways to create value for members

We’ve already talked about member events, but some donors may not enjoy the crowds. They may want another way to feel like they belong. Here are six ways you can give them that happy feeling.

  1. Member only content – Your membership plugin can help you restrict content to pages that only members have access to. For instance: create a list of businesses that offer discounts to your members–and only members get to see the list.
  2. Member directory – Offer your business members the chance to be listed in a member directory that is promoted to non-business members or available to the public on your website.
  3. Member event discounts – Tying your events calendar to your membership database through your membership software will allow you to offer special ticket prices just for members.
  4. Early event registration – Many event registration systems will allow you to have a private event page that isn’t listed on your main calendar until you activate it. Use this private link within an email message to your members. Tell them that registration is only open to them until a certain date when it becomes available to the general public.
  5. Member only emails or data – MLS systems and Realtor associations often send out or make available valuable statistics about market trends to their members. Consider if you have data that would be attractive for your members to receive regularly. If you don’t have stats to share, consider conducting a survey of members or those you serve, so that you do have information to share. Or perhaps there is a thought leader in your space who would be willing to write a guest blog post or newsletter column that is only available for your members?
  6. Member only listserves or social media groups – Popular platforms for groups include LinkedIn and Facebook. Trade associations have used listserves to share information between members about job openings and best practices. But first consider:
    • What type of information will be meaningful to share among members in this group? Will it support your mission or feel like a stretch in terms of relating to your nonprofit’s goals?
    • Are you on a solid footing with your members and donors before starting a group? (It could unintentionally become a platform for members to complain about you.)
    • How much staff time will be spent moderating such a group?

Do you have other ideas about creating value for your members or reasons to offer memberships? Let us know in the comments.

Amy Hufford is a Technologist at MembershipWorks. She has worked in membership technology for more than 20 years and has experience building membership websites with a variety of membership software platforms.

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