This article was first published as “Marianne’s Mining Minute” in the APRA Upstate New York chapter’s newsletter, 2014.
I got a little carried away in this issue thinking about prospecting overall and the ways that data mining can be blended into prospecting, management, and portfolio assessment work. I hope these ideas help you weave your new analytics program into your already successful fund-raising practice.
We are bombarded all the time with ideas for the panacea that will make our fund-raising easier. The fundraisers who manage us like to have all the bells and whistles that, say, the development office across town has. Given that, we are often pushed into adapting new technology that our organization may not be ready for, especially the newest tools. And data mining, despite that it’s been around for over 15 years, is still a new tool that takes skill and time to adapt into our routines.
But using analytics tools in any capacity is still worthwhile, and so this article covers a few case studies to help you decide at what level you want to participate, along with how to mix data mining and donor modeling into a good program. See these examples of different organizations in different fund-raising cycles, and how they might cope using a variety of tools.
A Hospital Whose Fund-Raising Staff Have Been Cut Back
We have gone through a round of hospitals merging and reconsidering staffing levels. As your hospital development office expands again, because every donated dollar comes with no obligation, you want to prove that the choice to add staff again is an excellent one – and you won’t be downsized again.
Start by Boosting the Annual Fund
Analytics has been used by annual giving programs since they were invented. They just called it reporting, analysis, or strategic planning. Using analytics to figure out who your new and loyal donors are (especially what the causes are beyond memorials and grateful patients) will help your program attract sustaining funds. How do you do that?
- Buy analytics as part of your fund-raising consultant’s contract, but only if your fund-raising consultant has an annual giving component in the firm’s offerings. Otherwise, look at the myriad tools offered by a variety of vendors, from out of-the-box visualization software to full service dashboard development.
- Run demographic reports to look closely at these two specific segments (new donors and loyal donors) and review them in private first before conducting a prospecting meeting. At your next prospecting meeting, talk about the trends you see, the outliers you’ve found, and then develop a strategy for follow up.
- Take a course (Coursera offers them all the time) on finding the characteristics of a new donor or a loyal donor. The method you want to learn is logistic regression or decision trees. If you’re brave enough to brave the statistical package R then you can start your analytics career spending only your time.
Identify Your Top Prospects
Top prospects are not entirely the same as top donors. We can often find ourselves examining our own navels when we try to name our top 1% of prospects, using giving patterns in the definition. What you are looking for are the best prospects for your small major gifts staff to visit. They may be people who have already given and are happy to give even larger gifts if they are presented with the right project, but you will also want to find new people for your gift officers to talk to. Consider these steps.
- They have enough liquid assets to give at your major gifts level. (If they don’t then they are excellent annual giving prospects.)
- They have some relationship with your healthcare organization. (If they don’t, then they are excellent prospects for you to talk to your volunteers about in peer screening sessions – who knows them and can bring them into the family?)
- They have experience as philanthropists. (If they don’t, then they are excellent prospects for your events team to cultivate.)
You do want all three to give your major gifts team a quick start on raising major gifts. How do you find them?
- Use a screening product to find wealth and philanthropy among your constituents. Review the top list with your gift officers, paying attention to the identified philanthropy and the liquidity of the identified assets.
- Hire an analytics firm to find the characteristics of those who look like your top donors.
- Learn how to model top donors using linear regression.
A Small Social Services Agency Where the Fund-Raising Staff Are Also the Public Relations Staff and a Dozen Other Things
When your workday is scattered among many types of responsibilities, focusing on analytics that may or may not lead to fund-raising activities that, in turn, can be too big to do, can be, well, a bit out of reach.
Outsource Thoughtfully
The adage goes that if you can’t do it in house, you must buy it. If you can’t buy it, you must get really creative about getting it as close to free as possible. Consider these ideas:
- Run a volunteer screening session with your community’s best volunteers, those who can suggest new prospects.
- Run a list of constituents who live in the nicer parts of town, and ask a volunteer to host a local event in her home in that part of town.
- Get a list of foundations in your state or province. Find those foundations that might fund your organization. Show the trustee lists to your board, asking if they know the donors or directors.
- Conduct a screening project on your constituency. Consider asking the trustee or top volunteer who is most enthusiastic about raising the bar on fund-raising to sponsor the project.
Analyze Thoughtfully
- If you want to do analytics, consider setting up good reporting tools so you can see trends on the fly first. Devoting a few weeks of complex analytics work leads to a result that you’ll use just once, and that won’t support your cause well. Making a dashboard that gives you trend information every day will help you spot trends and shift strategy continuously.
- Look at changes in giving rather than trying to conduct a full model. Someone whose giving doubles over last year is worth a look.
- Consider working with vendors on very specific, concrete projects to get the minimum cost for the most important answer.
Organize Well
Because your day will likely be consumed by the tyranny of the urgent, consider using good tools to do work for you. Here are some ideas:
- Set up alert systems using both Google alerts to find news of use to you and alerts through your reporting system that notify you of gifts or moments requiring good stewardship.
- Consider buying a second computer screen for your gift processor, reducing time that is spent flipping back and forth between programs.
- Develop and excellent, almost self run social media campaign that not only delivers the message, but tracks the results (look at NodeXL).
A College Where the Research Shop Consists of One Person
A lot of non-profit organizations envy the natural constituency that schools enjoy. However, colleges and independent schools with small fund-raising shops still have to be creative – not only with their time but also with their budgets. Try some of these ideas:
Focus on the Focus
Fund-raising may feel like it has yearly cycles, but actually there are many cycles that come into play. I list them from the longest cycle to the shortest:
- The maturity cycle of the organization (or the organization’s leadership)
- The campaign cycle
- The annual giving cycle
- The affinity cycle
- The event cycle
At any time, you can be part of an organization that is mid-campaign, refreshing strategy because there is a new vice president of development, mid-year in your annual giving cycle, and 2 days away from your biggest event. Paying attention to where you are in all of these programs helps direct what your work is. But remember: A researcher’s job is to be preparing for next year while everyone else is working through this year. Your job is to assure prospects for the next campaign and sometimes even help delineate the best prospects for next year’s annual giving program.
Ask for Help
We are professionals who ask each other for a lot of help and that is unusual in any competitive environment. But my statement, “Ask for Help,” is really about asking your team to help. From the gift processor through to the major gifts staff, everyone in your office can identify and point you to clues and to prospects. Reward them well when they do and cultivate them all the time to send tidbits your way.
Make Your Alert System Effective
Always make sure that you are getting alerts that are tailored to your situational need. If you are just starting a major gifts program, then you need new prospects, so getting even alerts on new books coming out by your constituents counts.
Buy Screening and Modeling on Key Prospects
Given your limited time to work through lists, consider buying screening on your non-donors and modeling on your donors. That way, you cover the waterfront and you are then:
- Finding wealth among your non-donors so your colleagues focus on cultivating top suspects
- Modeling the best donors of your donor pool to help all your offices renew and upgrade donors
Wrap Up
At any given time, there is always something you can do to add new tools to your daily routine. My habit has been to add a new tactic one at a time, let it be adapted into my standard routine, and then add another. This way of constantly modernizing is the kaizen approach, and it has worked very well for me for years, given that it does not shock the system.
You can do this, step by step.