Three ways to leverage your data and increase fundraising revenue in 2021
12 November 2020 at 7:00 am
With data now more valuable than oil, it’s time not for profits turned to a data-driven fundraising approach to increase both revenue and impact.
What if you knew exactly how much a donor would be willing to give, which campaigns they would resonate with, how they would like to be contacted with your solicitation, and how their donation would shape the next three, six, or 12 months of your fundraising?
As more not for profits are coming under significant financial threat, this knowledge isn’t a “good to know” for fundraisers, it’s a “need to know”.
In 2020 thus far, approximately 35 per cent of Australian charities have already reduced their staff, with another 40 per cent unsure if further reductions will be needed. And while JobKeeper was extended until January 2021, avoiding the anticipated funding cliff in October, there is still a gap in staffing resources as everyone rushes to pivot their fundraising efforts to more digital environments.
Slipping through the cracks is donor cultivation at a time when it should be at the forefront of our priorities. Yet with 85 per cent of charities reporting that physical distance laws have affected or hindered their ability to perform fundraising activities, it is easy to see how stewardship has stalled.
To rectify this, we need to turn to a data-driven fundraising approach. And as data is now a more valuable asset than oil, it’s time not for profits began compiling data to create donor personas, analysing it with artificial intelligence, and tracking results to increase both fundraising revenue and social impact in an otherwise uncertain 2021.
1) Build donor personas to identify your target audience
A donor persona is a hypothetical profile of your ideal donor. It’s a powerful tool to help you better understand your donor pool, create relevant content, and build authentic relationships. This leads to a more engaged donor base and more donations down the line.
Often the profile will be written as if describing an actual person. While semi-fictional, they’re built in the image of real-world donors combined with imagined detail. For example:
Donor personas are a boon to overburdened teams. They’re a shortcut to understanding your supporters better, and can help compensate for fewer cultivation meetings even amidst rising workloads. More importantly they will help develop personalised communication strategies and digitally steward new and existing supporters more effectively.
With so many charities looking for support from a finite number of donors, it’s especially important now to make sure your staff and resources are being used efficiently.
You should aim to build three to five profiles to better understand the nuances of each corner of your database.
Pay attention to defining information like age, political affiliations, household income, education, religion, social media, and online behaviours, and anything else relevant to your organisation.
To build them, start by segmenting donors using combinations of your key data points listed above. This could include donor type (subcategories: first time, repeat, etc.) and age group (subcategories: baby boomer, millennial, etc.) Keep the categories relatively high-level.
Then analyse your data, looking for patterns or useful correlations that will help you craft your personas. For example, if you see a correlation between major donors who live in populated areas outside of cities with populations greater than 700,000 and who aren’t on social media, it’s time to call your printer and start organising a flyer drop.
Ready to build your donor profiles? You can use this free template.
2) Use artificial intelligence to improve stewardship
Rather than rely on accrued napkin notes from coffee dates or text reminders to self after extended in-person chats, not for profit professionals are turning to artificial intelligence and other relationship-building tools in order to meet donors where they are.
A series of sector-specific AI-tools is changing the way organisations can think about fundraising. Not for profit professionals have insight into valuable information such as how much to ask from a donor, when to solicit a donation, and what campaigns a donor might be interested in based on both predictive and trend-based algorithms.
Amidst layoffs, pivots, and a reallocation of resources, implementing AI is like unleashing your fundraising secret weapon in a time you need it most. And as your AI spends more and more time with your donor data, it will learn and improve, making this an asset to your team in 2021 and beyond.
3) Track KPIs to monitor success
KPIs, or key performance indicators, are the final piece to the fundraising puzzle.
How do you know the campaign you ran was successful? Should you run it again as is or tweak it? How did it compare to similar campaigns from the past? You can understand the answers to these questions by developing and measuring KPI data.
KPIs are broken down into two categories, leading and lagging indicators. Leading indicators measure the likelihood you’re going to succeed, and lagging indicators are the metrics you track to determine success after the fact. So, the more you focus on metrics, the more you’ll be able to see what worked, what didn’t, and begin to create accurate forecasts by leaning into your leading indicators.
There are countless KPIs you could choose to measure the many facets of your organisation, from metrics on fundraising data, like accrued donations per month and email marketing open rates, to metrics specific to your organisation’s programs and services. Choose which are important to you then create a KPI dashboard to monitor successes and areas of improvements over time.
Strategic, data-driven processes will ensure that every dollar you’re spending is being used to its full effectiveness, something to keep in mind when JobKeeper does end. Investing in innovative technology that makes your data easy to interpret will reap great returns on your fundraising.
Donors are interacting with your organisation in increasingly digital ways, and without a firm handle on your data to drive your decision-making, you may be losing out on increasingly important opportunities.
If you’d like to learn how your not for profit data can work harder for you, you can test out Keela’s digital fundraising tools free for 15 days.