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Understanding Donor Management

Prepared by Syah Putra Shahrul Zahrin

Donor management is the process of gathering, maintaining, and tracking donor-related data, which includes their personal information, donation dates, and the details of any frequent contacts they may have with an organisation. Managing and analysing these datasets enables non-profit organisations to take the measures required to establish meaningful and mutually beneficial relationships with their donors. As a member of a non-profit organisaton, have you ever wondered about the strategies needed to implement this practice for your operations? Check out this article to learn more on how to encourage your donors to continue donating and supporting your organisation’s cause.

Table of Contents

ThunderQuote has recently published an article entitled ‘Diving into Donor Management Systems’ , which touched on donor management systems (DMSs) and the various DMS options that are currently available on the market.  This article serves to complement the one mentioned above by focusing on the practice of donor management as a whole, the benefits that this practice can bring to an organisation as well as related strategies in this area. It will also discuss some case studies around the process of donor management and how organisations have successfully implemented and made use of specific pieces of donor management software for their operations. 

In simple terms, donor management is the process of obtaining, storing and keeping track of donor-related data, which includes their personal details, donation dates, and the details of any interactions that they may have with an organisation on a regular basis. Managing and analysing these datasets allows organisations to take the necessary steps to forge meaningful and mutually beneficial relationships with their donors Having personalised relationships with donors makes them feel more appreciated and encourages them to continue donating and supporting the organisation’s cause.  

Benefits of Donor Management

Targeted Communications

Identifying the interests and demographic profiles of their donors allows organisations to effectively create personalised content that caters to the needs of each individual. This, in turn, encourages donors to watch the distributed content and engage with organisations through the various communication channels available.

Organisations may also attempt to identify their donors’ preferred channels of communication, whether it be through emails or social media channels. Categorising donors in such a way prevents unnecessary and ineffective attempts at communication and saves on time and resources.

Donor Relationship

Understanding the interests and goals of their donors allows organisations to identify the specific causes that they are most passionate about. This is important as donors are more likely to feel satisfied with their contributions when their personal goals are fully aligned with the goals of the organisation.

Keeping track of their donors also allows organisations to express their appreciation in appropriate ways, typically by following up with thank-you letters, and keeping them updated on the status of the initiatives that their donations have been used for to allow them to see the positive impacts of their contributions.

Improved Fundraising

Having sufficient amounts of donor information on hand allows organisations to analyse various trends in order to identify when and which donors are most willing to make contributions. Identifying the right times to reach out to their donors increases the chances of organisations potentially securing more donations in the long run, while proper analysis of donor profiles helps organisations identify new prospective donors.

Proper donor management also includes organisations providing comprehensive and simple-to-use platforms for donors to make their contributions through. This is because donors are more inclined to make recurring donations if these donations can be made conveniently online, through their phones, from anywhere around the world.

Strategies in Donor Management 

#1 Set Goals

Every shot at or attempt to do something is pointless if there is no end goal in mind. The same goes for volunteer efforts, where goals and the extents to which they are fulfilled serve as good indications of how fruitful an organisation’s efforts are over time. By setting and accomplishing realistic and achievable goals, organisations can clearly monitor their progress. For example, an organisation may set a goal of increasing their annual rate of donor retention by 5%, and achieving that goal would prove that their efforts are bearing fruit.

#2 Create Profiles

It is almost impossible for organisations to keep track of the personal details of many individual donors at the same time. They may therefore find it helpful to create donor personas that outline the traits and preferences of specific groups of donors. These profiles can be generated based on various data points such as age, gender identity, education level, as well as forms and frequencies of social media usage. Doing this also makes it easier for organisations to detect patterns in their data, and draw on those patterns to better engage with donors in the long run.

#3 Document Donor Journey

Most donors go through a ‘donor journey’, which may be defined as a range of predictable actions that they take both before and after making their donations. Keeping track of donor data allows organisations to record and classify these donor journeys into various categories, which allows them to predict when and how donors will make their next contributions. This technique allows organisations to ask for donations at moments when donors are most willing to provide them, which is beneficial for both parties as organisations are able to successfully secure more donations while keeping their donors happy.

#4 Classify Donors

As previously mentioned, organisations would benefit from creating profiles of their donors and grouping them into specific categories based on common data points within those profiles, such as donation amounts and frequency of donations. NGOs may even choose to take this process one step further by incorporating donor journey data in order to classify donors based on when they are most likely to donate, allowing for organisations to streamline their efforts at communication and ensure that maximum donation potential is reached through minimal use of resources.

#5 Build Plan

The next step after setting goals, creating donor profiles, documenting donor journeys, and grouping or classifying donors is to reach out and begin interacting with them through various communication channels. However, organisations should not simply start communicating with their donors without setting up a plan beforehand as it is important to keep the amount of financial and non-financial resources that an organisation has in mind to prevent unnecessary wastage and to ensure that an organisation doesn’t exceed their budget during this process. Elements of a good plan include: A timeline, a resource allocation plan, descriptions of communication topics during stakeholder interactions, and a list of goals that have been previously set.

Case Studies 

The following case studies show how donor management processes were used by various organisations to effectively engage with and obtain buy-in from their donors. 

  • In 2020, a case study was conducted to examine the donor management practices of Mercy Malaysia and how they were used to engage with its donors. The study found that Mercy employed good donor management practices such as monitoring the contributions of their donors and organising discussions and/or consultations with them to effectively obtain pieces of feedback, which lead to the donors not only supporting Mercy, financially but also through their participation in the humanitarian missions conducted by the organisation. 
  • TechForce is a nonprofit organisation that focuses on providing technical education to help fulfil the aspirations of underprivileged members of the community. According to the CEO of TechForce Jennifer Maher, the NPO was able to grant approximately USD$2 million in scholarships to eligible students, due to the multi-channel approach they took with regards to their donor management process which involved the use of DonorPerfect’s online form to allow members of the public to donate from their phones. TechForce prioritises communication with its donors and engages with them through well-produced videos on its social media channels and live conversations that are streamed online. 
  • This case study focuses on the donor management efforts of the Asheville Humane Society. The organisation was initially spending around USD$3500 a day just to run its day-to-day operations, which left it with limited amounts of funds for its other projects. With the help of donor management systems, the Asheville Humane Society was able to revamp its major donor programs and receive a donation pledge of USD$20,000 within the first four months of the DMS’s initiation. 
  • Another organisation that employed the use of good donor management practices is City Garden Montessori, a Montessori school focusing on creating safe spaces for children to learn and thrive without disparities or barriers to their success. City Garden Montessori needed a proper way to report on its constituents, which prompted the school to use Bloomerang as their donor management system of choice.. Since implementing the donor management system, City Garden Montessori was able to drastically improve the quality of its communications with donors and reduce the amounts of time taken for them to create personalised messages. The donor management system also provided City Garden Montessori with insights into key metrics such as donor retention and the amounts of money or funds that they have raised so far. 

Summary

  • Donor management is the process of collecting, keeping and monitoring donor-related data.
  • Some benefits of implementing good donor management practices include targeted communications, better donor relationships and improved fundraising.
  • Key donor management strategies include setting goals, creating profiles, documenting donor journeys, classifying donors and building donor management plans.
  • Case studies from Mercy Malaysia, TechForce, Asheville Humane Society and City Garden Montessori showed that the implementation of good donor management practices can be beneficial to organisations.
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