Donor Management: A Guide To Effectively Managing Your Nonprofit’s Donors

I don’t know about you, but I love donor data. I’ve gotten absolutely giddy over moves management functions, cross-referencing, and year-over-year comparisons. This is all part of smart donor management.

It is possible I am a big nerd.

You may think about donor data as a necessary evil you have to track so you can get back to the human fun part of fundraising. The prospect of creating a “donor management” strategy may strike you as cold and impersonal, or just something you don’t have time for.

But friends, your database is a land of untold wonder! A magical kingdom that can help you connect with your donors, build relationships, and grow your nonprofit each time you visit it. A secret cache of knowledge that can, on occasion, make you appear to be psychic. A unifying talisman that everyone in your organization can use!

If people are the heart of fundraising, then data is the brain. In order to connect with people, fundraise effectively, and grow your nonprofit, you need a donor management strategy to record, organize, analyze and use donor data.

What Is Donor Management?

“Donor management” is simply the process of tracking the details of your donors and your interactions with them, and then using that information appropriately. We don’t call writing your friend’s birthday in your calendar or remembering that they hate olives “friendship management,” but it’s really the same principle. Whether personal or professional, relationships benefit from keeping track of the details.

Appropriate donor management can improve your fundraising. It influences the kind of experience your donors have with your organization and helps you stand out of the crowd.

With a dedicated fundraising CRM (Customer Relationship Management) you can get to know your supporters through personal profiles that centralize and track their donor activities and engagement. You can quickly see the data you need to personalize communication, identify trends and opportunities, and activate and rally your supporters. It’s pretty cool.

Donor Management Requires Good Data

Before you can start strategizing, you need some raw data. At a minimum, you should record:

• Donor contact details
• Gifts they make and when they make them
• Interactions you have with them
• Communications they receive, and if they respond to them
• Preferences they express
• Events they attend
• Your own notes
• The ability to create cross-references to other records is a very nice bonus

You may not have all of this information from the beginning of time, but continue to add to your donor records as you go, and start recording these things with new donors. If your current donor records are a mishmash of different details and formats, it’s worth it to standardize them.

What Good Data Can Help You Do

Tracking donor data is almost meaningless unless you use it. Once you have the data, it’s time to analyze it, or as I like to think of it, looking for unicorns.

Look for trends in giving, patterns of donor behavior over time, and for things your donors have in common. This information can inform your fundraising strategy, allowing you to be more targeted to your actual donors.

For example, I may examine my data, and find that a few of my donors are unicorns who give consistently in the spring, but most of the donors are pegasi (that’s the plural of pegasus, right?) who give consistently in the summer. Knowing this, I may decide to launch my peer-to-peer fundraiser, a flying horse race, in July rather than April.

Use your data to connect with donors via segmentation, targeting, moves management, and personalization.

Segmentation

Segmenting your donors into different groups based on shared characteristics is useful for several reasons:

• It allows you to only deliver messages to the people who are likely to want them.
• It avoids redundancy. For example, if you segment your volunteer-donors into their own group, you won’t send them, “Become a volunteer!” messages.
• You can target communication more specifically, adjusting your tone to appeal to different groups or donor personas.

Key Benefits Of Segmentation: Deeper Engagement, Less Tuning-Out

Targeting And Moves Management

Tracking a donor’s gifts over time helps you know what to ask them for. If they’ve given you $100 at year-end like clockwork, you know you can probably ask for $125 without alienating them. Conversely, a person who gives $10 every couple of years is probably not a good candidate to ask for $100.

Without well-kept data, it’s hard to implement any kind of moves management. Moves management is a donor cultivation process that moves key donors along a strategic path to things like major gifts, board membership, and other kinds of deep commitments to your organization. Donor management can help you identify prospects, record their progress along the path, and ensure consistency across the organization.

Key Benefits Of Targeting and Moves Management: Organizational Growth, Not Leaving Money On The Table

Personalization

Fundraising professionals meet a lot of people. It’s easy to get fuzzy on the details, but it is never good for a donor to feel forgotten. When you record your interactions with donors, they become more than just a number. You can make your relationships more human, and less transactional by checking your records to refresh your memory.

Imagine you’re a repeat donor to an organization. Consider how you’d feel if you got a fundraising appeal with, “It was so nice to see you at the Gala, hope your vacation was wonderful!” scribbled in the margin. Now think about how you’d feel if you got an appeal addressed to “Ms. Your Name Spelled Wrong.” Personalization makes a difference in whether or not someone feels valued.

Keeping good records can also help you honor your donors’ preferences. If someone takes the time to tell you that they don’t open emails, only want to give online, or only want to be solicited once a year, your records will ensure their preferences are taken into account by everyone in the organization.

Key Benefits Of Personalization: Retention, Loyalty

Donor Retention Is Easier With Donor Management

You’ve probably heard the dismal donor retention stats. Most first-time donors don’t give again, so it makes sense to spend the majority of your efforts on keeping the donors you already have, rather than continually seeking out new ones. New donors are good, and acquisition should be part of your strategy, but never at the expense of taking care of current donors.

The for-profit world understands this. Brands spend a lot of time, effort, and money to keep their customers coming back. They send targeted coupons based on your purchases. They send you sales emails based on things they know you like. They do this by tracking data. We nonprofit folks can follow their lead by using donor data to make donating a personal, inspiring, positive experience.

When you segment, target, and personalize information, the donor who receives it is more likely to stay engaged with your organization. Donors who know they matter to you, that you remember them from last time and pay attention to the things they tell you, will have a deeper connection to your organization. They’ll feel more positive about their involvement, and more invested in your outcomes. Ultimately, donor management is a big part of ensuring donors stick around.

Donor Management Best Practices

Whatever system you use to control your data, be it fundraising CRM or lowly Excel spreadsheet, some best practices apply for good donor management.

1. Trustworthiness: Your donors have trusted you with their personal information, and you owe it to them to be careful with it. Use a secure system to store data, and change passwords frequently. Control access to your database–not everyone in your organization should be able to edit it or see it. Be doubly careful if you are storing credit card information.On a different kind of trustworthiness, do not record anything in your database that you wouldn’t want a donor to see. While your database is not a public document, it’s wise to be discreet. “Donor X expressed his disappointment with our programming, do not solicit” is much better, if less satisfying, than, “Donor X is a jerk, don’t ask this jerkface for anything ever again.”
2. Consistency: Many nonprofit databases are like an archeological dig, in which you can trace generations of development staff, just by how the data is (or is not) entered. Without any rules for entry, you will quickly end up with a mess. Standardize the kinds of things you record, and the way you record them. Document the process, and train everyone who enters data in it. This will give you a nice, clean database that’s easy to use, and that won’t be upset by staff changes. (Bonus points if your CRM automatically tracks and updates donations).
3. Dedicated to Donors: Keeping track of your donors’ information and interactions is a big enough task for a database. Don’t try to do a bunch of wildly different things, like your organizational accounting, or selling tickets, out of the same system.
4. Update Frequently: In addition to NCOA updates (National Change of Address), and purging duplicates and long-lapsed contacts, update your interaction notes as soon as possible after they occur. If you talk on the phone with donors, I recommend opening your database and writing your basic notes directly while you’re talking, if it won’t distract you. Write yourself a brief summary after meetings, and keep a running list of donors you meet during events, so you can enter your data later.
5. Back It Up: Losing all your data is a fundraising disaster, but it’s easily avoided by backing up regularly. Whether you have cloud storage as part of your CRM, or save your Excel spreadsheet to an external drive (and then lock that drive up, data security, friends), make sure you aren’t keeping all your data eggs in one basket.

Donor Management Tools

If your spreadsheets are getting unwieldy, it’s time to consider using a donor management tool. Look for a fundraising CRM that is:

1. Easy to Use: I’m going to go out on a limb and guess that your primary job responsibility is not “Software Learner.” Choose donor management tools that make sense to you, and are simple to use. Creating records, running searches, and pulling reports shouldn’t be headache-inducing. Things don’t need to be complicated or intricate to do the job.
2. Nonprofit-Specific: Donor management software is (shocker!) better for donor management than generic database software. It already speaks your fundraising language and is designed to track the things you want to record. Since, again, I’m 99% sure your job is not “Software Adapter,” using a fundraising CRM will save you time and trouble.
3. Offers Support: Does it come with tech support? How much do you need to pay for that? How readily can you access support? If your job isn’t “IT Expert,” this is relevant information. I mean, in the world of nonprofits, it’s entirely possible that you are the official Fundraiser/IT Person/Janitor/Van Driver, but if so, you should probably outsource tech support anyway, you’re really busy.
4. Easily Integrates with Other Tools: It’s a wonderful world when your fundraising tools integrate. This saves you time by avoiding entering the same data in multiple places and makes donor communications downright breezy. If you’re going to invest in software, then make sure it plays nicely with the tools you already have.

Donor Management Is Worth It

It’s okay if the prospect of recording, organizing, updating, and using all that donor data is a little overwhelming. You can work on it bit by bit, and every improvement you make will make a difference. The benefits of donor management outweigh the tedium of data entry, enabling you to fundraise more effectively by reaching your donors personally, communicating more efficiently, and, ultimately, boosting your donor loyalty.

So tackle your data, and connect with your donors. You might even find some unicorns.

For More On Donor Loyalty And Retention, Check Out:

The Donor Engagement And Retention Playbook

The Power of Trust, Habit, & Loyalty In Donor Relationship Building