Donor Database Management System Benefits

2770 words (11 pages) Essay

8th Feb 2020 Health Reference this

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Abstract

Non-Profits who utilize a Donor Database Management System (DDBMS) properly can cultivate a deeper relationship with donors and volunteers, better known as a non-profit’s constituents. According to Garecht (n.d.), a good donor database is crucial in successful donor cultivation. His list included finding the right dataset as the number two item on his list of cultivating donors.  The number one item on the list is having a plan.  DDMS allow non-profits to segment information enabling non-profit in targeted fundraising strategies.  Data about how long a donor has been giving to what the donor’s interest are can all be stored and managed in a DDMS.  DDMS or Constituent Relationship Management (CRM) software makes segmentation an attainable process. Like any other process, having a plan and workflow is the most important part.  Garecht (n.d.) was not wrong when he stated that his number one way to supersize cultivating donors is by having a plan. Having the right database for any successful non-profit is only one part of the overall best practice organizations need to stay top of mind in a very competitive industry.  Non-profits must know what data they want to collect and how that data will be utilized.   

Keywords: Database Management, Donor Cultivation, Relationship

 

Introduction

Donor Data is the life-blood of a Nonprofit.  In a GuideStar blog, contributing author C. Wells (2018), states that the collection of reliable data is crucial for nonprofits of any size. She notes that nonprofits must operate like any for-profit organization.  She asserts that data collection is essential but can be a double-edged sword. On one side, having good data can assist nonprofits to operate on reduced resources or help shape the future of nonprofit organizations. On the other side, nonprofits often don’t have adequate reporting for the data collected or data is dubious leading to missed opportunities.  She also discusses how reliable data collection is vital for nonprofit organizations of any size to view the complete representation of prospects that are created with robust and trustworthy data.  Why is a DDBMS or CRM so important to an organization? According to Author K. Alberg (2017), having a DDBMS would allow for sharing of information across the departments only strengthens the relationship of the constituent to the organization. 

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There are two points that nonprofits need to follow in delivering the industry’s best practices in handling and utilizing donor data.  First, nonprofits need to collect useful data, not just collect data for collection sake.  Experts across the industry agree that nonprofits of all sizes must know what is important to their organization and how that data will help them strategically.  Second, nonprofits need to incorporating fundraising tools in a Donor Database Management System (DDBMS) or Constituent Relationship Management (CRM) software.  This could assist nonprofits to take constituents from individuals who just donate to a cause to supporters who have real relationships and longevity with an organization. Dan Quirk (2018), a contributing author of the NonProfit Pro website, states that the use of a CRM can only help nonprofits dig deep to understand the data collected about constituents.  A CRM assist nonprofits create targeted campaigns that shows the constituents that the organization is paying attention to their interests, not just asking for a donation.  To the vast majority of nonprofit staff, these two points are obstacles in their work life.  Staff have been known to not fully understand the complexities of a database or feel that data collection is too tedious.  In both barriers, having strategies are key components to combat these obstacles and will ensure progress and proper processes.  According to Quirk (2018), “smart nonprofits would have a strategy in place for managing all of the data that comes along with donor relationships.”

Data Collection

 Nonprofits are all unique and data collection is not a one-size fits all objective.  Nonprofits must decide what is truly important to their organization and its purpose.  “If you attempt to collect too much of the wrong data, you risk alienating your donors while getting booged down with things that don’t matter” (Shattuck, 2015).  Instead of asking for a donation or pledge, nonprofits should use the opportunity to ask the constituent to answer a few simple questions about themselves.  This not only signals an interest in the donor, but will start to build the trust of constituent for future communications.  In an article by A. Franklin (2018), nonprofits should start small, inquiry about the donor and not go immediately for the big ask.  When nonprofits ask for a donation without showing interest in who is giving that donation, nonprofits risk turning off the donor to giving any information or donation. 

 Once the organization decides what is important and what it will be used for, standard operating procedures for data entry needs to be documented and enforced.  By documenting and adhering to one collective process it ensures data is consistently formatted and easily accessible to all staff members (Shattuck, 2015).   It is not enough to only have documentation about what data to collect and how to collect it, staff needs to have training to understand and utilize the CRM. Training should be an on-going process with regularly scheduled times.  This should be applicable for all staff, not just a select few.  A CRM will only give a nonprofit what it puts into it.  This will create actionable processes that will make data collection less tedious for all involved and provide a much smoother workflow.  By having a plan, standards, and training, nonprofits can reap the benefits of a CRM (Shattuck, 2015). 

DDBMS Utilization

 Now that nonprofits have decided what is data important and its purpose, having the right tool is another key component to DDBMS utilization. A database is only as complex as the users make it. Database management tools increase efficiency, the ability to analyze, and communicate what donors want to support. Jay Love (2018) contributing author to the Nonprofithub.org, states that nonprofits often times make the poor choice of investing in a cheaper less sustainable database.  This creates a vacuum of being stuck with a system that isn’t utilized and missed opportunities for growth.  Nonprofits need to invest in a true DDBMS that will grow with the organization and support their donor data strategies.  The management of donor data should not be heaped onto any one individual.  It needs to be the responsibility of the entire organization.  There should be subject matter expertise for the operation of the database, as well as team members who have the fundraising expertise to guide the strategic efforts of the utilizing the DDBMS (Hawthorne, 2016).  Hawthorne (2016), also recommends that data should be centralized.  When data is not kept in a central location, a complete plan can’t be executed.  A DDBMS needs to be scalable, customizable, and in today fast paced business environment, cloud based (Love, 2018). 

 Within the CRM or DDBMS the development of fundraising tools such as segmentation list and customize reports are critical for donor retention and possible increases in giving levels.   A CRM can assist nonprofits track constituents’ giving history, manage robust constituent profiles, and create customized data reports. Why are these important to a nonprofit?  According to Love (2018), having these tools can increase a constituent’s giving levels and create a donor retention when used properly.  Within a constituent’s giving history, nonprofits would be able to track what inspires an individual to give, when the donation is made, and how that constituent makes their donation.  This is known as a targeted appeal or segmentation.  For example, if a nonprofit launched a campaign to fund foodbanks within the community, it could track how many constituents gave to that campaign and how they gave.  The data collected could be used later used to either run another foodbank campaign and reach out to only those who gave previously or utilize another category for funding to those constituents who did not donate to that foodbank campaign (Quirk, 2018).

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 When there is a complete constituent profile, it becomes easier to invite the individual to support a nonprofit’s fundraising efforts.  It is no longer enough to just have a constituent’s contact information.  Nonprofits needs to have a more complete representation of who their constituents are and what they are interested in supporting.  “Having a firm grasp on who your donors are and what they bring to your nonprofit can only help you create strategies that meet supporters exactly where they are” (Quirk, 2018).  Some elements that could help build a robust profile are hobbies or interest, employer information, and social media presence. Having these types of information can tailor how a nonprofit communicates with a constituent.  For example, if a constituent is known to have a large social media presence, a nonprofit could tag that individual in its social engagement events to help promote the event.  Being aware of what is known as Major Influencers can be a goldmine for nonprofits who are just starting out in the world of social media fundraising (Quirk, 2018).   

 Analysis of donor data is often times neglected by nonprofits for a one specific reason. Data is overwhelming.  By utilizing a CRM to create customized reports nonprofits can better understand and highlight crucial metrics that are important to the organization. Reports such as constituents with high engagement, donors who have downgraded, and overdue pledges can be created for fundraisers. Why is this important? Without this data, fundraisers wouldn’t be able to reach the next level of engagement with a constituent (Love, 2018).  For example, with a customized report, nonprofits would know how many constituents have been a supporter for over ten years and have increased their donation every two years.  With that information, nonprofits could set a strategic plan to cultivate a relationship with those constituents for a legacy gift to the nonprofit.  Another example of how custom reports can assist nonprofits is by engaging those constituents who have downgraded their support.  Fundraisers could target communication with those constituents to either find out why they downgraded their support or create a new strategy to engage their support in a different way. 

Conclusion

Like any for-profit organizations, nonprofits have clients.  Who are those clients? Constituents.  A nonprofit can only thrive when constituents support its mission and strategic goals. Utilizing a DDBMS will not only assist a nonprofit to engage their supporters through unique communication, it would allow a nonprofit to stay competitive amongst similar organizations.  The most critical point that nonprofits must understand is how valuable donor data is.  Data about constituents can either do great things for a non-profit or lead the organization down the wrong path.  Not having solid constituent relationships can decrease a nonprofit’s fundraising efforts. Nonprofits of any size need to know the value data brings to an organization (Wells, 2018). 

Choosing the right donor database or CRM is another critical step for a nonprofit’s success in donor relations. Holt (2013), shares Tech Impact’s Senior Manager of Application Services, Dean Graham’s recommendations when choosing the right system for an organization.  Graham recommends organizations ask the following questions:

1. Does your nonprofit’s database facilitate workflow or create more work?

2. Can you trust the information in your CRM, and does it still ring true to your   organization’s initiatives?

3. Who manages the database?

4. Does your CRM help you build and maintain relationships?

A DDBMS should enhance an organization’s workflow not create more work.  Staff across departments should have easy access to maintain constituent profiles and shared data.  If an organization can’t trust the data that the DDBMS is storing, it becomes useless or could be detrimental to a nonprofit.  It must be able to evolve like most nonprofits do.  Nonprofits need to have a DDBMS that is up to date. Administrators can assist the entire organization manage the how the DDBMS operates (Holt, 2013).  For a smaller nonprofit who may not have the funds for a dedicated database team, creating a subject matter expert group that includes individuals from each department could have the same effect.  This would also encourage ownership of the database across the organization.  “Data can be an invaluable asset when it is accurate and you have the right tools to analyze it” (Wells, 2018).

References

Abstract

Non-Profits who utilize a Donor Database Management System (DDBMS) properly can cultivate a deeper relationship with donors and volunteers, better known as a non-profit’s constituents. According to Garecht (n.d.), a good donor database is crucial in successful donor cultivation. His list included finding the right dataset as the number two item on his list of cultivating donors.  The number one item on the list is having a plan.  DDMS allow non-profits to segment information enabling non-profit in targeted fundraising strategies.  Data about how long a donor has been giving to what the donor’s interest are can all be stored and managed in a DDMS.  DDMS or Constituent Relationship Management (CRM) software makes segmentation an attainable process. Like any other process, having a plan and workflow is the most important part.  Garecht (n.d.) was not wrong when he stated that his number one way to supersize cultivating donors is by having a plan. Having the right database for any successful non-profit is only one part of the overall best practice organizations need to stay top of mind in a very competitive industry.  Non-profits must know what data they want to collect and how that data will be utilized.   

Keywords: Database Management, Donor Cultivation, Relationship

 

Introduction

Donor Data is the life-blood of a Nonprofit.  In a GuideStar blog, contributing author C. Wells (2018), states that the collection of reliable data is crucial for nonprofits of any size. She notes that nonprofits must operate like any for-profit organization.  She asserts that data collection is essential but can be a double-edged sword. On one side, having good data can assist nonprofits to operate on reduced resources or help shape the future of nonprofit organizations. On the other side, nonprofits often don’t have adequate reporting for the data collected or data is dubious leading to missed opportunities.  She also discusses how reliable data collection is vital for nonprofit organizations of any size to view the complete representation of prospects that are created with robust and trustworthy data.  Why is a DDBMS or CRM so important to an organization? According to Author K. Alberg (2017), having a DDBMS would allow for sharing of information across the departments only strengthens the relationship of the constituent to the organization. 

There are two points that nonprofits need to follow in delivering the industry’s best practices in handling and utilizing donor data.  First, nonprofits need to collect useful data, not just collect data for collection sake.  Experts across the industry agree that nonprofits of all sizes must know what is important to their organization and how that data will help them strategically.  Second, nonprofits need to incorporating fundraising tools in a Donor Database Management System (DDBMS) or Constituent Relationship Management (CRM) software.  This could assist nonprofits to take constituents from individuals who just donate to a cause to supporters who have real relationships and longevity with an organization. Dan Quirk (2018), a contributing author of the NonProfit Pro website, states that the use of a CRM can only help nonprofits dig deep to understand the data collected about constituents.  A CRM assist nonprofits create targeted campaigns that shows the constituents that the organization is paying attention to their interests, not just asking for a donation.  To the vast majority of nonprofit staff, these two points are obstacles in their work life.  Staff have been known to not fully understand the complexities of a database or feel that data collection is too tedious.  In both barriers, having strategies are key components to combat these obstacles and will ensure progress and proper processes.  According to Quirk (2018), “smart nonprofits would have a strategy in place for managing all of the data that comes along with donor relationships.”

Data Collection

 Nonprofits are all unique and data collection is not a one-size fits all objective.  Nonprofits must decide what is truly important to their organization and its purpose.  “If you attempt to collect too much of the wrong data, you risk alienating your donors while getting booged down with things that don’t matter” (Shattuck, 2015).  Instead of asking for a donation or pledge, nonprofits should use the opportunity to ask the constituent to answer a few simple questions about themselves.  This not only signals an interest in the donor, but will start to build the trust of constituent for future communications.  In an article by A. Franklin (2018), nonprofits should start small, inquiry about the donor and not go immediately for the big ask.  When nonprofits ask for a donation without showing interest in who is giving that donation, nonprofits risk turning off the donor to giving any information or donation. 

 Once the organization decides what is important and what it will be used for, standard operating procedures for data entry needs to be documented and enforced.  By documenting and adhering to one collective process it ensures data is consistently formatted and easily accessible to all staff members (Shattuck, 2015).   It is not enough to only have documentation about what data to collect and how to collect it, staff needs to have training to understand and utilize the CRM. Training should be an on-going process with regularly scheduled times.  This should be applicable for all staff, not just a select few.  A CRM will only give a nonprofit what it puts into it.  This will create actionable processes that will make data collection less tedious for all involved and provide a much smoother workflow.  By having a plan, standards, and training, nonprofits can reap the benefits of a CRM (Shattuck, 2015). 

DDBMS Utilization

 Now that nonprofits have decided what is data important and its purpose, having the right tool is another key component to DDBMS utilization. A database is only as complex as the users make it. Database management tools increase efficiency, the ability to analyze, and communicate what donors want to support. Jay Love (2018) contributing author to the Nonprofithub.org, states that nonprofits often times make the poor choice of investing in a cheaper less sustainable database.  This creates a vacuum of being stuck with a system that isn’t utilized and missed opportunities for growth.  Nonprofits need to invest in a true DDBMS that will grow with the organization and support their donor data strategies.  The management of donor data should not be heaped onto any one individual.  It needs to be the responsibility of the entire organization.  There should be subject matter expertise for the operation of the database, as well as team members who have the fundraising expertise to guide the strategic efforts of the utilizing the DDBMS (Hawthorne, 2016).  Hawthorne (2016), also recommends that data should be centralized.  When data is not kept in a central location, a complete plan can’t be executed.  A DDBMS needs to be scalable, customizable, and in today fast paced business environment, cloud based (Love, 2018). 

 Within the CRM or DDBMS the development of fundraising tools such as segmentation list and customize reports are critical for donor retention and possible increases in giving levels.   A CRM can assist nonprofits track constituents’ giving history, manage robust constituent profiles, and create customized data reports. Why are these important to a nonprofit?  According to Love (2018), having these tools can increase a constituent’s giving levels and create a donor retention when used properly.  Within a constituent’s giving history, nonprofits would be able to track what inspires an individual to give, when the donation is made, and how that constituent makes their donation.  This is known as a targeted appeal or segmentation.  For example, if a nonprofit launched a campaign to fund foodbanks within the community, it could track how many constituents gave to that campaign and how they gave.  The data collected could be used later used to either run another foodbank campaign and reach out to only those who gave previously or utilize another category for funding to those constituents who did not donate to that foodbank campaign (Quirk, 2018).

 When there is a complete constituent profile, it becomes easier to invite the individual to support a nonprofit’s fundraising efforts.  It is no longer enough to just have a constituent’s contact information.  Nonprofits needs to have a more complete representation of who their constituents are and what they are interested in supporting.  “Having a firm grasp on who your donors are and what they bring to your nonprofit can only help you create strategies that meet supporters exactly where they are” (Quirk, 2018).  Some elements that could help build a robust profile are hobbies or interest, employer information, and social media presence. Having these types of information can tailor how a nonprofit communicates with a constituent.  For example, if a constituent is known to have a large social media presence, a nonprofit could tag that individual in its social engagement events to help promote the event.  Being aware of what is known as Major Influencers can be a goldmine for nonprofits who are just starting out in the world of social media fundraising (Quirk, 2018).   

 Analysis of donor data is often times neglected by nonprofits for a one specific reason. Data is overwhelming.  By utilizing a CRM to create customized reports nonprofits can better understand and highlight crucial metrics that are important to the organization. Reports such as constituents with high engagement, donors who have downgraded, and overdue pledges can be created for fundraisers. Why is this important? Without this data, fundraisers wouldn’t be able to reach the next level of engagement with a constituent (Love, 2018).  For example, with a customized report, nonprofits would know how many constituents have been a supporter for over ten years and have increased their donation every two years.  With that information, nonprofits could set a strategic plan to cultivate a relationship with those constituents for a legacy gift to the nonprofit.  Another example of how custom reports can assist nonprofits is by engaging those constituents who have downgraded their support.  Fundraisers could target communication with those constituents to either find out why they downgraded their support or create a new strategy to engage their support in a different way. 

Conclusion

Like any for-profit organizations, nonprofits have clients.  Who are those clients? Constituents.  A nonprofit can only thrive when constituents support its mission and strategic goals. Utilizing a DDBMS will not only assist a nonprofit to engage their supporters through unique communication, it would allow a nonprofit to stay competitive amongst similar organizations.  The most critical point that nonprofits must understand is how valuable donor data is.  Data about constituents can either do great things for a non-profit or lead the organization down the wrong path.  Not having solid constituent relationships can decrease a nonprofit’s fundraising efforts. Nonprofits of any size need to know the value data brings to an organization (Wells, 2018). 

Choosing the right donor database or CRM is another critical step for a nonprofit’s success in donor relations. Holt (2013), shares Tech Impact’s Senior Manager of Application Services, Dean Graham’s recommendations when choosing the right system for an organization.  Graham recommends organizations ask the following questions:

1. Does your nonprofit’s database facilitate workflow or create more work?

2. Can you trust the information in your CRM, and does it still ring true to your   organization’s initiatives?

3. Who manages the database?

4. Does your CRM help you build and maintain relationships?

A DDBMS should enhance an organization’s workflow not create more work.  Staff across departments should have easy access to maintain constituent profiles and shared data.  If an organization can’t trust the data that the DDBMS is storing, it becomes useless or could be detrimental to a nonprofit.  It must be able to evolve like most nonprofits do.  Nonprofits need to have a DDBMS that is up to date. Administrators can assist the entire organization manage the how the DDBMS operates (Holt, 2013).  For a smaller nonprofit who may not have the funds for a dedicated database team, creating a subject matter expert group that includes individuals from each department could have the same effect.  This would also encourage ownership of the database across the organization.  “Data can be an invaluable asset when it is accurate and you have the right tools to analyze it” (Wells, 2018).

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