The When, Why, and How of Data-Driven Fundraising

2,199 views

Published on

bbcon 2013

Published in: Technology, Business
0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
2,199
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
102
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide

The When, Why, and How of Data-Driven Fundraising

  1. 1. 10/7/2013 #bbcon 1 The Why, When and How of Data Driven Fundraising Presented by: Jenny Cooke Smith Page Bullington
  2. 2. 10/7/2013 #bbcon 2 • Why Data Driven Fundraising? - Explore Macro Trends of Donors and Dollars - Review generational shifts in donors • When to Implement? - Data Points to Audit - Giving Scorecard • How to Incorporate Analytics? - Case Studies showing data driven approach • Let’s Hear from the Experts: - Panel of peers for Q&A TODAY’S AGENDA
  3. 3. 10/7/2013 #bbcon 3 • Having data and using data are two different states • Consider what should you be buying or building to better support your efforts • What should you collect to help with your analysis and segmentation • Consider which data points should act as a trigger to change cultivation efforts • Embrace the value of benchmarks – try not to fix the wrong thing POINTS TO PONDER
  4. 4. 10/7/2013 #bbcon 4 TARGET ANALYTICS Leading Provider of Supporter Insight & Analytics to the Nonprofit Sector  Division of Blackbaud, Inc.  7,000+ Customers, Across All Nonprofit Segments Key Assets:  Cooperative Database - Industry’s largest donor database; over 2B philanthropic transactions from 80M+ households  NOZA Database - Industry’s largest searchable database; over 65M uniquely identified gift records  donorCentrics – Nonprofit’s largest & most established performance benchmarking practice, with more than 530 participating organizations Key Product Lines:  Direct Marketing Solutions  Major Gift Fundraising Solutions  Data Enrichment Services  Performance Benchmarking & Reporting
  5. 5. 10/7/2013 #bbcon 5 QUOTE FROM THE COURAGE CENTER We had lots of cold prospects, so we used modeling to find out [which prospects] were warm enough to cultivate. Within five months, I identified 300 people for the major gift program and each has a target range — which allowed our officers to spend their time more productively. — KRISTEN BARLOW, PROSPECT RESEARCHER
  6. 6. 10/7/2013 #bbcon 6 TWEET ABOUT YOUR SESSION #BBCON #TAWORKSHOP
  7. 7. 10/7/2013 #bbcon 7 WHY DATA DRIVEN FUNDRAISING?
  8. 8. 10/7/2013 #bbcon 8 WHY? IT’S NOT GETTING EASIER Source: National Index for Fundraising Performance, Target Analytics
  9. 9. 10/7/2013 #bbcon 9 WHY? IT’S NOT GETTING EASIER 23% 8% 11% 21% 7% 11% 19% 7% 10% Private Public Overall 2010 2011 2012 Source: CAE, Voluntary Survey for Education Source: Higher Education Index for Fundraising Performance, Target Analytics 11.70% 10.00% 9.85% 9.50% 9.20% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 2008 2009 2010 2011 2012 Participation Rates for Higher Education
  10. 10. 10/7/2013 #bbcon 10 CHANGING DEMOGRAPHICS How they give is different too! Better Understand Your Donors by Leveraging Similarities and Managing Differences! » 52% give via the mail » 34% give in honor or tribute Matures » 40% give via the mail » 30% give in honor or tribute » 46% give via work » 21% give monthly » 42% give via organizational websites Baby Boomers » 50% give via retail transactions » 50%+ give via work » Close to 50% of Gen X and 62% of Gen Y would give via mobile » 46%+ fundraise on behalf of organizations » 40%+ give via organizational websites Generation X & Y
  11. 11. 10/7/2013 #bbcon 11 Donor Truths we have learned for ALL types of organizations WHO IS GIVING… Retention Reactivation Acquisition Donor Migration (i.e. pipeline to major giving)
  12. 12. 10/7/2013 #bbcon 12 . . . donors giving at higher levels are more likely to retain WHO RETAINS? Source: donorCentrics - two consortium groups of public and private Higher Education institutions examining Fiscal Year 12 data. 39% 60% 65% 70% 79% 80% 79% 86% 85% 86% 87% 82% 42% 51% 60% 65% 73% 74% 77% 82% 81% 77% 76% 85% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Private Public
  13. 13. 10/7/2013 #bbcon 13 . . . the longer a donor the more likely to continue giving WHO RETAINS? Source: donorCentrics – consortium group of Cultural Organizations examining Calendar Year 2012 data Donor Loyalty Median Retention Rate New 35% 2 years 62% 3 -4 years 72% 5+ years 84%
  14. 14. 10/7/2013 #bbcon 14 . . . The more frequent the gift, the more likely to retain WHO RETAINS? Source: donorCentrics – consortium group of International Relief Organizations examining Calendar Year 2012 data Gifts per Year Median Retention Rate 1 48% 2 63% 3+ 86%
  15. 15. 10/7/2013 #bbcon 15 RECURRING GIVING: THE VALUE OF SUSTAINERS $434,304 $183,662 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 1 2 3 4 5 6 CumulativeRevenue Years on File 6 Year Value of 1,000 New Donors Sustainer Revenue Single Gift Revenue Figures are based on the Calendar Year Data for organizations (not Higher Ed) participating in Sustainer benchmarking
  16. 16. 10/7/2013 #bbcon 16 . . . the longer a donor prior to lapsing, the more likely to reactivate WHO REACTIVATES? Figures are based on the Calendar Year Data for organizations (not Higher Ed) participating in Environmental benchmarking Donor Loyalty (before lapsing) Median Reactivation Rate New 5% 2 consecutive years 12% 3-4 consecutive years 15% 5+ consecutive years 19%
  17. 17. 10/7/2013 #bbcon 17 HOW ACQUISITIONS ARE OCCURING? Direct Mail Face to Face Online Marketing Direct TV Phone Resident Peer to Peer
  18. 18. 10/7/2013 #bbcon 18 WHY IS IT IMPORTANT TO UNDERSTAND DONOR GIVING BEHAVIOR? It is much easier and cost-effective to keep your donors on file than to acquire new donors The old standards still hold true » Recency, Frequency, and $ still drives a program » The downside of not managing these metrics closely can hurt a program through lost revenue and donors » Capitalizing on giving patterns can create new opportunities for your organization New donors are out there » We are not solely relying on a few donors who give frequently to fuel acquisition » Newly Acquired Younger donors may not be solicited as heavily as older donors who give frequently. Old assumptions on channel behavior may not hold true in all cases • Analyze before assuming 
  19. 19. 10/7/2013 #bbcon 19 I KNOW I NEED TO DO IT… WHEN DO I IMPLEMENT?
  20. 20. 10/7/2013 #bbcon 20 • Audit your data ‘warehouse’ - What data do you have? Age, Wealth, Channel behavior, etc? • Perform a file assessment - What does your donor base look like? - Where are the opportunities? - Where are the holes/risks? • Identify organizational goals - Align your data leads with organizational goals • Ask questions - What tools exist to help you achieve your goals; utilizing internal and external data DATA POINTS THAT SAY “IT’S TIME”
  21. 21. 10/7/2013 #bbcon 21 Major Gift Scorecard Leverage Your Existing Fundraising Potential Organization The Becker Institute Nonprofit Sector Higher Education Constituent Records 70,000 Major Gift Level $15,000 Model Justification The gift-level and contribution calculations identified in the prospect screening results were based on the following types of wealth and philanthropic information linked to your major gift prospects: Recommendations Based on the issues identified, Target Analytics recommends the following solutions / techniques to convert the unrecognized potential detailed above: • Principal Giving (All Prospects) • Major Gift Likelihood Modeling (All Prospects) • Target Gift Range Modeling (All Prospects) • Comprehensive Wealth Screening (Top 10%) • Echelon Power Segmentation (Top 10%) Prospect Screening We’ve screened your current supporter base to establish their giving potential, and have identified the individuals that are performing optimally, are under-performing, or are severely underperforming relative to where they should be: Data Point Count Number of $10,000 Gifts To Your Organization (Last 5 Years) 275 Number of $10,000 Gifts To Other Nonprofits (Last 5 Years) 435 Constituents With $1,000,000+ In Identified Total Assets 112 Constituents With $1,000,000+ In Non-Real Estate Assets 235 Constituents With $250K+ In Household Income 365 Constituents With $80K+ in Discretionary Spending 2,311 Optimal Gift Level Optimized Donors Under Performers Severe Under Performers $500,001 - $1,000,000 6 3 3 $200,001 - $500,000 1 2 3 $100,001 - $200,000 6 4 5 $50,001 - $100,000 14 1 1 $25,001 - $50,000 17 2 1 $10,001 - $25,000 4 1 0 $5,001 - $10,000 239 302 123 Total 53% 31% 16%
  22. 22. 10/7/2013 #bbcon 22 WHY DOES ‘WHEN’ MATTER? Knowing When- You won’t know ‘when’ unless you understand your organizational goals, areas of opportunity and risk, and have a sense where you are succeeding/failing Goals- Understanding your organizational goals and benchmarking your progress towards these goals can help guide where additional data and analysis is needed Costs- Understanding priorities can help align budgets with data and analytic needs. Sound investment can be made in a methodical yet fiscally responsible way
  23. 23. 10/7/2013 #bbcon 23 HOW DO I INFUSE ANALYTICS INTO MY PROGRAM?
  24. 24. 10/7/2013 #bbcon 24 The Challenge • Large # of low-level donors (< $1K) • Sub-optimal response rates • Upcoming budget cuts & streamlining CASE STUDY Goals & Objectives • Migrate lower-level donors to $1K+ • Increase response rates across gift levels • Grow revenue while cutting costs
  25. 25. 10/7/2013 #bbcon 25 • Pre-project estimates indicated that while the obstacles where substantial, the goals were fully attainable • Projected a 65-75% increase in known constituents likely to give between $50 - $250 • Estimated a 500% increase in known constituents that were likely to give $1000+ ANALYTICS RESULTS / STRATEGY
  26. 26. 10/7/2013 #bbcon 26 Recommended Strategy - Targeted investment increases in those individuals identified as “most likely to give” (largely via additional solicitations) - Reduce or eliminate interactions with those that are unlikely to contribute - Apply a data-driven ask amount based on TGR; not to exceed 25% of last gift - Implement a specialized mailing campaign specifically targeted at $1K-$5K prospects. - Solicitor assignment for individuals $5K+ or over, as defined by Target Gift Range STRATEGY / RESULTS 35% Increase in Revenue 22% Increase in Responders 50% Increase in AVG Gift Size
  27. 27. 10/7/2013 #bbcon 27 HOW: CASE STUDY- LOYALTY DATA Results Using Loyalty Insights (Client identifies wasted mailings on unprofitable & unresponsive segments) Example: National Relief Organization Solution Used: Loyalty Insights (descriptive analytics model) to leverage donor loyalty that compares donor giving behaviors to the organization with other non-profit orgs they support. • Used to communicate differently with best segments via messaging and offer treatments and identify areas of reduced investment for least loyal segments Results Using Traditional RFM Model (Recency, Frequency, Monetary Amount)
  28. 28. 10/7/2013 #bbcon 28 HOW: CASE STUDY- LOYALTY DATA Case Studies from clients and agencies identifying, developing, and finding successful strategies using Insights Case Study A: Client used Insights to target for their Sustainer Invite. They segmented out the LI codes that were part of their normal data select for the invite call (i.e. they didn’t pull in other top Insights names; only those they would have normally mailed). Results- They saw stronger gift response rate across the three most loyal donor groups and an increase in sustainer pledges as well. Client is crediting this strategy for turning around their phone invite program. The # of pledges in one campaign equated to the sum of all sustainers acquired in all 3 sustainer invite calls all year. Case Study B: Client utilized the top 3 audiences for Planned Giving mailings with success; one large gift can make all the difference! In addition to Planned Giving usage, Client B also used Insights for ask string testing: TEST: Best of the Best & New and Noteworthy- tested current membership $ (control) vs. 1.5% and 1.25% the current membership year $ Habitually Generous- tested current membership $ (control) vs. test panels of current membership $ +$10 and current membership $ +$20 Results- Best of the Best & New and Noteworthy- BOB- tests resulted in RR% lift of 17% and lift in gift of 8.9% NEW- tests resulted in RR% decrease but decrease was replaced with 18% lift in gift- net flat Habitually Generous- flat response (test vs. control) but 20% lift in gift
  29. 29. 10/7/2013 #bbcon 29 • Utilize predictive modeling to reactivate Lapsed universes. Lapsed Tags are a letter rating (A-J) assigned for lapsed donors, indicating a likelihood to reactivate via a direct marketing appeal • This predictive solution helps an organization identify the likelihood to reactivate; enabling better marketing focus, allocation of marketing budget, and suppression of low response donors HOW: REACTIVATE LAPSED DONORS
  30. 30. 10/7/2013 #bbcon 30 WELL DESIGNED AND EXECUTED ANALYTICS… • Uncover supporter insights that aren’t easily derived from wealth screening alone • Streamline the process of interacting day-to-day with supporters • Direct our investment towards the constituents & initiatives which yield the highest ROI • Produce results that far surpass past performance, in terms of revenue and efficiency
  31. 31. 10/7/2013 #bbcon 31 CLIENT PANEL
  32. 32. 10/7/2013 #bbcon 32 Kristin A. Heller • Executive Director of Prospect Development and Information Strategy at The College of William and Mary in Williamsburg, VA Jeff Lindauer • Associate Vice President for Development at the Indiana University Foundation John Perell • Director of Direct Response and Shared Services at the Smithsonian Sandra Miao • Director of Direct Response at The National Wildlife Federation PARTICIPANTS
  33. 33. 10/7/2013 #bbcon 33 AVAILABLE FREE RESOURCES FROM TARGET ANALYTICS Resource Examines . . . Updates The Blackbaud Index Overall and Online Giving that incorporates $12 Billion in US charitable giving Monthly Index of National Fundraising Performance Giving trends from Animal Welfare, Arts and Culture, Environment, Health, Human Services and International Relief Quarterly Index of Higher Education Fundraising Performance Giving trends in Higher Education with subsets for Private and Public Institutions Annually npEngage Collection of nonprofit blogs highlighting best practices and industry trends Regularly
  34. 34. 10/7/2013 #bbcon 34 Session Title Timing Presenter(s) ResearchPoint Roadmap Monday 8:30-9:45 AM Anthony Tomaino, David Lamb Annapolis 1-2 Drive Offline Response with Online Advertising Monday 10:00 – 11:15 AM Richard Becker Earning That Society-Level Gift Monday 10:00 – 11:15 AM George Durney, Page Bullington Keys to Success for Growing a Sustainer Program Monday 1:30 -2:45 PM Nicola Bach AJ. Minogue Addressing the 2nd-Level Donor Pyramid Tuesday 9:15-10:30 AM Page Bullington Lifetime Loyalty and Lasting Legacies Tuesday 10:45 AM – 12:00 PM Lawrence Henze, Katherine Swank TARGET ANALYTICS AT BB CON

×