In his 2017 book, The Fourth Industrial Revolution, Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, offered the idea that technology empowers people rather than replaces them. What are the implications of this revolution on fundraising and engagement and what can we do to keep up with the aggregation of massive amounts of data and the insights it provides? This can be overwhelming to some and stimulating to others.
Do all fundraising professionals have to be analysts?
We don’t all have to be data scientists. However, all of us – from major gift officers to annual fund, marketing specialists to managers setting the strategic direction – do need a working knowledge of data, how to analyze it, and how to take actionable steps based on the insights gleaned from analysis. It is no longer just the responsibility of Advancement Services and Annual Giving to understand and utilize data. Senior managers, frontline fundraisers, marketing and communications, and alumni relations professionals can benefit from getting comfortable with data to help set strategy.
What stands in the way of using data analytics in our fundraising work?
The most commonly cited reason is time. In the press of the day to day, it’s hard to find the time to focus on analytics and strategy. Often medium and small organizations lack staff resources to keep up with the data analytic needs. Missing or incomplete data can be frustrating when trying to connect with prospects. Also cited is a lack of understanding of what to look for and how to set strategy against the analytic findings.
Data management and strategic planning.
1. Data audit and cleansing.
Conduct a biannual audit of the known data to determine its quality. What percentage of constituents can be reached via various marketing channels – email, mail, phone, social media? What is known about business information? What percentage of the data is updated annually, quarterly? What percentage of mail is being returned regularly? What percentage of email bounces back?
2. Data Enrichment
Outsource for cell, landline and email appends. Contract with National Change of Address (NCOA). Outsource for additional data about your constituents which will help you identify your best prospects.
3. Data Analytics
Analyze giving trends regarding donors and dollars. Look at trends among the loyal, lapsed, and leadership donors. Who is upgrading and downgrading? What are the giving trends with reunions, young alumni, and senior gift? What does your donor retention look like? What are the sources of your gifts and who is using those channels? Who is giving more than one gift a year and are you stewarding those donors well? What are your trends in engagement? What events are alumni attending and what do you know about the attendees?
4. Predictive Analytics
If you want to take your analysis to the next level, I recommend outsourcing to gain insights about strategy both from your data and third party data that enriches what you may know about your constituents. Predictive analytics can help you position your organization for future success by helping you to understand how to allocate your time and staffing resources. These predictive models will help you answer questions like who is likely to give, who is at risk of not giving, which marketing channels to use for success and where to hold events.
Setting strategy using analytics is not a luxury, it’s a necessity. The investment you make in data and analytics will pay off in terms of targeted communication to the right constituents about the things they care about, which will help them engage in your cause and inspire them to give.