Category Archives: Strategic Planning

Prospect Research: The Breakthrough Guide to the Basics

Prospect research can be a complex subject, but it’s vital to growing and developing your nonprofit’s donor base.

With over $373 billion donated last year, giving is on the rise, which means that prospect research is more important than ever for capitalizing on your donors’ generosity and building strong relationships with them.

In this guide, we’ll cover all of the basics, from the definition down to the nitty-gritty details of how prospect research can work for you!

Specifically, we’ll answer these questions:

Let’s get started!

What is prospect research?

Prospect research is the process of learning more about a specific donor or a group of donors so that your nonprofit can cultivate and manage them more effectively.

Prospect research is often used to identify and learn more about potential high-level donors who are giving below their true capacity. Major donors and planned gift donors, in particular, are often the subjects of this research.

To actually perform this important research, nonprofits can either:

  • Pinpoint an existing donor and fill in missing information that can give the organization a better sense of the donor’s giving capacity.
  • Screen a group of supporters, such as event attendees on an RSVP list, to identify new donors who may have high giving potential.

In both cases, the nonprofit seeks to gain a better understanding of their contributors by finding and assessing key data fields. Let’s talk about this point in more detail.

What data does prospect research target?

Nonprofit CRMs are full of data fields that compose your donors’ profiles (or those of your volunteers and board members). Some data points can be quite telling when it comes to understanding your donors.

Specifically, you’ll want to learn more about a donor’s ability and affinity for giving. That means that you need to understand how much your donors can give and their willingness to do so. Both of these factors are vital for gaining a comprehensive understanding of who your donors are.

We can break down these characteristics into specific data points.

A donor’s giving ability can be understood through:

  • Real estate ownership.
  • SEC transactions.
  • Business affiliations.
  • Political giving.

While this information could be captured in a wealth screening, it’s not enough to know how much your donors can give. It’s also important to know how invested they are in your cause, so that you can make an appropriate ask (and in the case of a new prospect, ensure that they want to give to your nonprofit in the first place!).

That’s why it’s important to analyze a donor’s giving ability in tandem with their affinity.

A donor’s affinity for giving can be understood through:

  • Past gifts to your nonprofit.
  • Past gifts to other nonprofits.
  • Philanthropic involvement.
  • Personal interests and connections.

With this data, your nonprofit can better understand your donors’ value to your organization so that you can make targeted asks that don’t leave money on the table.

Prospect research takes the fear out of fundraising; not only will your team know who to ask, but they’ll also have a better understanding of how much to ask for. This insider information can inspire confidence in your frontline fundraisers.

Now that you understand what prospect research is and what kind of information it identifies, let’s outline how a nonprofit can actually perform prospect research.

How does prospect research work?

To actually perform prospect research, your organization will need to invest time, resources, money, or a combination of the three. There are several strategies to choose from, depending on the size and stability of your organization.

To get started, let’s outline your options!

Prospect Screening Company

A prospect screening company can be ideal for larger organizations with the means to handle a lot of data.

Screening companies compare your donors against thousands of databases to fill in gaps in your prospect profiles and reveal information that you wouldn’t have known.

Then, these companies rank your prospects according to their potential, so your nonprofit can start strategizing.

This DonorSearch resource breaks down the questions you should ask before seeking out a screening company, so that your organization is as informed as possible!

Consultants

Consultants are experts who can lead prospect screenings or otherwise advise your nonprofit about all things prospect research.

Consultants are ideal for organizations who need to analyze a large batch of data all at once.

Since they’re temporary hires, your organization can save money in the long run by working with consultants only when you need them.

DIY

If you’re a small or new nonprofit, you may need to take on the task yourself. Public databases and resources can be utilized by talented team members to find out more information about important donors.

Though this method can be time-consuming, it saves funds where they’re tight.

In-House

Established organizations may have a full team assigned to prospect research that works internally.

This model is popular with universities, where donor pools fluctuate with every graduating class.

Why is prospect research important?

All of your donors are valuable, and you should be grateful for their gifts! However, developing your donor base is vital to making progress toward your mission.

It’s much more cost-effective to retain your donors than it is to acquire new ones; prospect research can help you make the most of the donors you already have and reach out to only your most likely prospects, saving your resources.

Plus, major and planned gift donors really keep nonprofits afloat. Their gifts will constitute a large piece of the fundraising pie, and prospect research is key for finding these high-impact contributors in the first place.

After all, major donors may be hidden in your database. It’s not unusual for donors with high giving capacities to give smaller gifts to online fundraising campaigns, such as large scale crowdfunding initiatives. This is often the case because they’re not comfortable sending large gifts over these channels.

Without prospect research, you’ll never know which donors have more giving potential. It’s highly unlikely that they’ll reveal themselves without a direct ask. That’s why it’s important to look into your database, especially as online fundraising grows in popularity.

Most importantly, nonprofits can use prospect research to build stronger donor relationships. You need your donors to accomplish your mission; the least you can do is meet them halfway by learning about who they are.

How can I use prospect research?

Aside from identifying major donors, prospect research can also enhance your fundraising strategy on the whole. After all, the more data you have, the better you can take your donors’ preferences into account.

Let’s break down the ways in which prospect research can elevate your fundraising strategy.

Determine your campaign

Understanding your supporters can help you create engaging fundraising campaigns and events that will bring in a lot of donations.

Prospect research can reveal donors’ interests to provide these insights. For example, if you notice that donors have given substantially to charity auctions hosted by other organizations, then you might want to adopt this event into your annual campaign.

As such, prospect research can help you narrow down your fundraising ideas and determine the campaign that works best for your donors.

Maximize your communications

Part of prospect research is filling in important data fields that tell you about your donors.

These data fields include a donor’s communication and giving preferences. In other words, how do donors want to interact with your organization and how do they want to give?

You can send donors more effective communications that they’ll actually respond to if you pay attention to their preferences.

For example, donors may prefer to communicate with your organization via:

  • Email.
  • Traditional mail.
  • Phone calls.
  • Your website.
  • Text messages.
  • Social media.
  • In person conversations.

Knowing how your donors want to speak with you can help you send them the most targeted, effective appeals.

Additionally, you can also use prospect research to determine your donors’ preferred giving methods so that you can craft the most effective multichannel marketing.

If, for example, a donor prefers to send checks to your organization, but enjoys the ease of online communications, you may find that an e-check or direct debit strategy would work well for this individual. If you find these giving patterns across your donor data, then you can use what you’ve learned to appeal to your donors on a mass scale.

Build your donor network

Some of the most important data that prospect research can uncover are your donors’ personal and professional relationships.

If you learn that your donors are friends with other high-value prospects, then you can leverage those relationships to gain an “in” with a new donor.

Similarly, a donor’s business affiliations can help you identify opportunities for corporate philanthropy. Donors who work at matching gift-eligible companies can be informed of the application process, so that they can double the impact of their future gifts.

Even more so, your organization can seek out partnerships with companies who can support your future fundraising events.

If many of your donors work for a company, then the CEO may be more inclined to lend a hand with in-kind donations, event support, or traditional (but invaluable) monetary donations.

To learn more about the top matching gift companies, check out this 360MatchPro resource!

Now that you have the basics of prospect research down pat, it’s time to apply what you’ve learned so that you can develop your understanding of your donors.

Then, you can take an informed, data-driven approach to fundraising, build stronger donor relationships, and and ultimately raise more for your cause!

The Alford Group is pleased to partner with DonorSearch, a prospect research, screening, and analytics company that focuses on proven philanthropy. This article was contributed by Ryan Woroniecki, Vice President of Strategic Partnerships at DonorSearch.

One Key Practice of Today’s Leading Cause Marketers

Feature Image 5 Midway through last week’s Cause Marketing Forum (CMF), during Katrina McGhee’s great talk on personal branding, I noted that a significant number of the CMF presenters—representing both causes and companies—were explicitly emphasizing one key practice. These cause marketing leaders focus on their strengths. They understand their organizational strengths and partner with others to mitigate their organizational weaknesses. In contrast to the trends earlier this decade when it started to feel like major cause marketers were shifting to owning self-made cause platforms over building partnership portfolios, this strengths-based approach is facilitating significant creativity and impact.

Instead of adopting a certain trend in structure or activation, today’s cause marketing leaders are focusing on what will work for them. For some, that is creating an owned national platform with local and agency partners providing support. For others, it is forging one or more partnerships of complementary opposites who each bring what the other needs. Through collaboration, they are then able to achieve the business and social impact results that they could not have achieved on their own.

Four Examples from Cause Marketing Forum 2016:

A few examples (of many, many more) that I found particularly instructive from last week’s event:

Youth1) Aria Finger, CEO of DoSomething.org, highlighted how they use their deep understanding of what makes young people tick to ensure that their partnerships are meaningful (and hip).

  1. 2) Ido Leffler, Co-Founder and CEO of Yoobi, spoke of Yoobi’s core competencies (product, design, and creativity) and their need to find retail and cause partners to bring their vision for business and social impact to life, saying “We do what we do best and we partner with others to do the rest.”

Uber

3) Michael Meyer, Vice President of Donated Goods Retail and Marketing at Goodwill Industries International, spoke about how the organization is using its brand strength and retail footprint to provide value for partners, in return for the new audiences and distribution channels that partners like Uber and The Container Store provide.

4) 2016 Halo Award Best Digital Campaign Gold Winners Samsung and Autism Speaks Canada provided countless examples including the profound use of Samsung’s technological strength along with Autism Speaks Canada’s expertise and credibility in serving families living with autism. Together, they created and promoted an app that uses the rear-facing camera on a mobile device to help children with autism practice working on eye contact.

Whether we are designing a platform, portfolio, or single partnership, we must first get real about the strength of the currencies, competencies and capabilities that we have in the context of what we want to accomplish. Then, we need to fill the gaps through custom alliances that both expand on others’ strengths and fill a gap for them.

Thanks and kudos to each of the phenomenal cause marketers who presented and won awards at last week’s event.

Your Strategic Plan: The Biggest Story You Can Tell in Major Gifts Fundraising

There’s a saying in fundraising that it is just as difficult to properly plan, cultivate and solicit a gift of $10,000 as it is $100,000. Often times, finalizing a major gift of any size will require the same amount of work and attention by your fundraising team. Assuming this is true, the real work for any development professional will come in the form of determining which story about the organization or impact of the gift will inspire a donor to give at their highest capacity.  That story inevitably lives in your organization’s strategic plan. Continue reading

Diversity in Fundraising: Making a Long-Term Commitment

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Growing up in Kentucky during segregation, Jimmie Alford attended an all-white school, and didn’t experience racial diversity until the age of nine when his parents moved to Chicago. The move, due to the closing of coal mines, placed Jimmie’s family in a small apartment in the Englewood community. Jimmie was one of three white students in his third grade class of 40 students.

Along with his classmates, he understood economic diversity and its impact on themselves, their families and their community while living in extreme poverty within a predominantly affluent nation. He also directly and personally saw and felt the impact of discrimination. He decided at a young age that the injustice of discrimination was something he would never allow to penetrate his life and that he would work his entire life to eradicate discrimination in all forms. Like many who grow up marginalized in one way or another, Jimmie vowed to lift himself out of his circumstances, make a better life and never forget the important life lessons learned along the way. His commitment to this goal was unwavering and steadfast.

Diversity

Diversity is one of seven core values of The Alford Group, and one of Jimmie’s enduring “fingerprints” on the consulting firm he founded in 1979. One manifestation of this commitment is our 20+-year sponsorship of the Diversity Workshop and Diversity Art Showcase at the annual AFP International Conference. While our dedication to diversity and inclusiveness has remained resolute over the decades, the demographics of America – and thus the universe of donors and prospective donors – have changed dramatically. Lessons learned from diverse communities, and the shared values of diversity, equity and inclusiveness (DEI), are more relevant and more essential today than ever before. Continue reading