Being a data-driven nonprofit means letting data guide your decision-making.

Steve Mclaughlin, the author of Data-Driven Nonprofits, advocates that data-driven organizations scale their impact by ensuring they’re making the best decisions for their organization based on evidence, and not just the whims of their highest-paid employees. 

So, don’t let the idea of using nonprofit data in all your decisions scare you! Your organization is likely collecting loads of donor data already, and in this article, we will explore how you can store, organize, analyze, and put that data to work. After reading, you’ll be on your way to being a data-driven nonprofit in no time.

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What is Donor Data?

Essentially, donor data is all of the information you collect on a donor.

Your organization is likely sitting on a wealth of donor data already, but are you using it to its full potential? Most organizations aren’t! In fact, 90% of nonprofits collect donor data, and only 5% use data in every decision they make. 

Some common examples of donor data points include a donor’s gift history, email, home address, and even whether or not they own a pet. More sophisticated forms of donor data, that you may be already collecting, could include email open rates, website clicks, and social media engagement

All of these data points help paint a picture of each donor’s journey within your organization. The more detailed a picture you can paint of each donor, the better you can personalize their experience and make more accurate appeals.

3 Best Practices for Managing Donor Data

Now we know what donor data is and how to collect it, it’s important to review some best practices for data management and analysis.

1. Store Donor Data in a CRM

When you’re handling mass amounts of data things can get messy very quickly. Fortunately, there are many different software solutions built specifically for nonprofits to help you manage your donors and keep data organized. 

customer relationship management tool (CRM), will allow you to store and manage any donor data you may have, such as donor contact information, alma maters, issues they’re interested in supporting and much more. 

Where donor management systems really shine is in their ability to automatically track all of your donor interactions, such as emails sent to donors or website engagement. Additionally, CRMs are able to analyze data and offer smart insights on donors, such as who would be best to reach out to next.

2. Organize Your Data

Unorganized data will make any form of data analysis frustrating. A great way to keep your data organized is by setting a spring cleaning day in your calendar. Donor databases can get messy when your team’s constantly updating them on the go, so set aside some time to clean them up. 

This is a time for you to ensure that all of your donor entries are up to date with all of the information you have on a donor. You may also want to delete duplicate entries, test email addresses and purge the ones that bounce. If you’re able to do this on a regular basis, such as every quarter, then you’re able to keep on top of it and it won’t become too overwhelming. 

Your data is what you feed into all the software that your organization uses and is the base for your decision-making. If the data is a mess, or worse- inaccurate, then your decision-making will be a mess too.

3. Choose Key Targets

Don’t let data overwhelm you. Instead, choose a few key targets to pay attention to within your data. Ask yourself “what do I really want to know about my donors?” Let the answer to this question point you towards the data you’ll pay the most attention to. 

Setting clear targets will ensure that you’re using donor data effectively, and not getting lost in a pool of numbers and figures. Some key targets you could track are donor retention rate, donor lifetime value, donor churn, and donor growth rate.

How to Put Your Data to Work

What can you learn from donor data? 

Your organization can gain valuable insights from the data you collect on donors. There are various practical applications for donor data: 

  • Measuring a donor’s engagement with your organization 
  • Evaluating a donor’s capacity to give 
  • Monitoring monthly giving trends
  • Studying your organization’s ability to retain donors
  • Segmenting your fundraising campaigns 
  • Understanding your donor demographics

These are just some of the insights you can gather from donor data. With these insights, you’re able to make more informed decisions and personalize your donors’ giving experiences. Here are some more ways you can put your data to work.

How to Make Data-Driven Predictions

Donor data can help you make predictions about donor behavior. In fact, by using the data you already have, you can make all sorts of predictions that can help you in your next appeal. 

For example, by knowing a donor’s demographic information you can assess their suitability to be a legacy donor. Specifically, legacy gifts from single, never married donors are about 13% larger than married donors. Fundraisers can use this information to prioritize their single donors as their potential legacy gifts are likely to be larger than gifts from married donors. 

Keeping data points like marital status may sound like a waste of time but it can result in more strategic campaigns and increased fundraising success.

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KIT gives fundraisers access to insights, predictions and recommendations about donors so they can fine tune their strategies and be more efficient with their work.

How to Build Personalized Fundraising Campaigns

Donor data can help you build better fundraising campaigns for your donors by keeping track of who your donors are and what they’re interested in. For example, by recording which campaigns donors have previously contributed to, fundraisers can segment donors based on what campaigns they’re most interested in. Then, donors can send out targeted communications to those donors, asking them to support their favorite initiatives. 

This process allows you to build a more targeted fundraising campaign, which will yield better results.

Improve Overall Nonprofit Growth

Studying metrics fueled by donor data will give you a better picture of your organizational health. Metrics such as donor retention rate, recurring donor growth rate, and major donor dependency rate provide fundraisers with a clear understanding of how effective, efficient, and sustainable their fundraising is. 

Further, by tracking these metrics on a regular basis you’re able to observe how different strategies impact your fundraising effectiveness.

Tools Like KIT Help Fundraisers Make Sense of Their Data

Not using a fundraising intelligence tool to help you analyze your donor data is like tying a brick to your shoe before running a race!

It’s going to make your life more difficult, slow you down and it just doesn’t make sense. Fundraising intelligence tools like KIT identify trends and patterns in your donor data and make suggestions and predictions to improve your fundraising.

There are various insights tools like KIT can generate using your donor data: 

  • What a donor’s capacity to give is
  • When the right time is to make an ask is
  • Which donor you should reach out to next 
  • Which donors are at risk of lapsing 
  • What opportunities there are to improve donor engagement 

Additionally, using technology to analyze your data means that you don’t need to hire an expensive data analyst to make sense of your data. On top of saving money, technology like KIT will allow you to make more personalized appeals and generate more revenue.

What is Fundraising KIT?

We started this article by discussing the importance of being data-driven in decision-making. Fundraising intelligence tools make this possible, even for busy fundraising teams, because these tools will analyze large amounts of data and offer you insights right when you need them, so all of your decisions are evidence-based. 

How are you using donor data at your organization? We would love to hear your learnings and top tips for data analytics at your nonprofit. Let us know below!

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