Take Your Major Donor Prospecting to Warp Speed with Analytics
Major donors are an imperative part of many nonprofit fundraising efforts. A single, large donation from a major donor can put a campaign over goal or close a budget gap. In many organizations, major donors are counted on to fund key initiatives or provide much needed general operating revenue.
Two key components of having a healthy major donor pipeline are to have a strong donor acquisition program and a strong prospect research program. Acquisition attracts constituents to your organization for the first time, feeding them information about the benefits that your organization provides for the community – local, national, or international – and how they can help to further that mission.
A prospect research program helps to identify individuals in your core donor program that might meet two key criteria for becoming a major giver. First, do they have the capacity to give large donations? Second, do they have the inclination, or affinity to the cause and organization to make that large donation? This is typically done through manual research or appending wealth indicators to the individuals.
This can be difficult and inefficient, as wealth indicators do not always have a high match rate to your donor file, meaning that prospective major donors are missed and treated like a core donor. On top of that, the wealth indicators are not always correct and do not indicate the affinity the individual has to the issue or the way that the organization addresses the issue.
For organizations that are looking to take the next step in automating prospect identification or optimizing the universe that a prospect researcher works within, overlaying high value data and predictive models can provide a very timely mechanism to focus your organization’s investment in identifying and researching major donor prospects.
High Value Data – Capacity Measures
A general wealth index is not always the best indicator of capacity. Although it gives you a good place to start, other data sources can help to get your organization to the point where you can pinpoint capacity.
- Discretionary Spend Index (DSI) – This index ranks the spending power of individual households on their ability to spend. For instance, two households with equivalent wealth indicators (income, real estate, life stage) may have distinctly different discretionary spending capacity. This can be due to a number of factors, including location and debt. Overlaying this score (1-1000) will help rank actual capacity vs. wealth.
- Income360 – This score provides a precise dollar value of a household’s total income, replacing a range that is available with most income measurements. In addition, this number includes investment related income, not just salary, and it gives a precise dollar value up to $2 million. Most competing measurements cap around $125,000, which limits your ability to prioritize within your file.
- Wealth Rating – This rating ranks a donor with a score (A-G) on their overall capacity to give by combining wealth and assets, including real estate, company ownership, and public holdings and options.
Any one of these measurements will help your organization be more precise with the overall capacity of each household on your file, so that you are focusing your researching time on those individuals that not only have a high income, but actual capacity to give a portion of their wealth to your organization.
High Value Data – Inclination or Propensity
So now you’ve identified who on your file are wealth and have the capacity to invest that wealth into the mission of your organization. The next step is to understand if that household has the inclination to invest that wealth to a nonprofit organization, to organizations within your sector, and to your organization specifically.
- Consumer Philanthropy – This data can be appended to your file to help understand the philanthropic interests of your constituents. This data is collected from multiple sources and can inform you on whether the philanthropic goals of your high capacity individuals are aligned with the mission of your organization.
- NOZA Philanthropic Append – This append organizes specific charitable gift data from NOZA to a specific constituent on your file. Capturing what other specific organizations that this household gives to can give you a better sense of the propensity for them to give to an organization like yours.
Capturing this high-value data lays a strong foundation to get very specific around forecasting revenue and/or predicting the conversion of a constituent to a major giver. In addition, it can give you a great sense of timing for an ask, and the right ask amount based on leveraging your prior major gift data.
Target Analytics already carries many of these high value predictive analytics, allowing an organization to gauge the likelihood of a major gift, planned gift, or principal gift, and a target gift amount .
- Major Gift, Planned Gift or Principal Gift Likelihood – These scores identify which individuals have the capacity to make a major gift as well as a propensity to give to your organization in these three different ways. High ranking individuals represent the top 15-20% of prospects and donors. Using the specific scores provided, you can easily focus your attention on pursuing the highest probability individuals first.
- Target Gift Range – This model can give you the information to understand the range that represents the optimal gift from a specific household. Although it does not give a specific dollar amount for an ask, the range will give you insight into what scale these individuals are likely to give at, ensuring that you are matching the right ask amount to the philanthropic goals of your constituents.
Use the tools at your disposal
In this post, we reviewed a variety of data sources available to append to your constituents to give you more specific insights around your top tier prospects and donors. These individuals expect that you will know how they want to be treated and the appropriate way to communicate with them.
In addition, leveraging this wealth of data and predictive analytics will help your organization to prioritize the optimal opportunities within your file, driving engagement and avoiding missed opportunity to this highly philanthropic base.
All in all, this set of tools is available to help you to identify those constituents that adore you and your mission, support the way in which you execute on that mission, and have the capacity to fund you at a high level.