Two weeks ago I used my blog, Twitter, LinkedIn and even my colleagues at The Agitator blog to get as many nonprofits as possible to take a 10-minute survey. Why? Well, in early April I had a two-part blog on modeling that was the outcome of me asking experts in the industry four questions about modeling and how it can help those in the nonprofit industry be better fundraisers and marketers.
The reaction to the blog was great! How do I define great? I got lots of e-mails asking for additional thoughts and dialogue. And guess what … many of those e-mails were from nonprofits that all seem to be worried about their internal data — the amount, the quality and, yes, even some worry about the value of the data.
So I created this survey to get a better understanding about data straight from the nonprofits!
And boy did I hear from nonprofits. More than 500 organizations took the time to give me their thoughts on what they capture and how they use it. To set the landscape, let me go ahead and give you some stats on who those 500 organizations were. I did not ask organizations to tell me their names, but I did ask them to identify several things about themselves.
Type of organization responding
Environmental/Animals …… 10.6%
International Affairs …… 2.7%
Arts/Culture …… 10.3%
Health …… 12.5%
Human Services …… 29.2%
Public Society Benefit …… 6.9%
Education …… 18.3%
Religion …… 7.2%
Foundation …… 2.4%
Coverage of organization
Regional …… 65.3%
National …… 20.7%
Global …… 14.1%
Annual revenue
Less than $100,000 …… 5.8%
$100,000 - $249,999 …… 6.4%
$250,000 - $499,999 …… 7.4%
$500,000 - $999,999 …… 8.5%
$1 million - $4.99 million …… 29.7%
$5 million - $9.99 million …… 11.7%
$10 million - $49.99 million …… 17.8%
$50 million - $99.99 million …… 4.8%
$100 million - $499.99 million …… 4.5%
More than $500 million …… 3.4%
Based on the above information, I feel good that I have a good cross-section of the nonprofit world. Since many charitable organizations are regional and not national, it was not a surprise to see that 65 percent of the organizations responding were in that category. There are a larger percentage of organizations in the human services category, yet there is a solid representation of the other types of organizations except for foundations and international affairs.
All this to say I think the information gleaned from this quick study of organizations is good enough to give us an idea of what is really happening in the world of nonprofit data. I asked only 10 questions, and of course three of those were to help define who was completing the survey. So in the remaining seven questions here's what I found:
The great news
Of 528 organizations, 92 percent indicated that they have databases (internally or hosted by a third party) that hold their constituent data. This is great news, and my guess is that five years ago that number was very, very different. This tells me that organizations of all sizes and types have really learned the value of capturing information on nonprofit constituents.
I also asked how many had business rules or processes in place that made it mandatory to capture specific constituent information. This is something we have seen across the industry become more and more common. Organizations have learned that what gets measured or tracked … gets done. By implying something is mandatory further emphasizes the organization's priority.
Across this survey group, 74 percent of the organizations have identified specific data elements that are mandatory to be captured on constituents. This is a great start. I know many of you reading this will have the same thought I do — it's probably contact information or the donation information that is mandatory. True, but a mandate can easily become expanded into other data elements that get identified as being critical for marketing and fundraising.
The detail matters
Now the real questions come in to play: What is being captured, and what are they doing with it?
I eased in to a simple YES or NO question about whether they capture specific types of information. As you can imagine, fundraising transactions (96.5 percent capture) and basic contact Information (99.7 percent capture) popped to the top as being captured across the board. This did not come as a surprise.
On the other end of the spectrum, I was surprised to see that only 30 percent of the organizations capture website interactions. For the purposes of this study, please note an answer of NO implies the transactions are present in the organization yet are not captured in the database. For example, if an organization does not have a website, it would answer N/A relative to the capture of website interactions. Only 8 percent of the survey respondents fell into the N/A category. In other words, it's not that they don't have websites; it's that 62 percent of the organizations are simply not capturing any of their website engagement with their constituents.
This was a tough number to see as we think of the rising influence of digital marketing and engagement opportunities. In fact, in one of my earlier blogs I shared information from a recent study that many constituents do their information-gathering online yet use another channel (direct mail commonly) to make a donation or take action. That is proof enough that website and other digital engagement is a critical part of marketing and fundraising.
There were other examples of organizations that do not have specific types of transactions.
- 46 percent of the organizations do not have any product sales — therefore, no interactions to capture
- 20 percent do not have any type of call center or donor services function — therefore, no interactions
- 29 percent do not have any type of advocacy program — therefore, no interactions to capture
As you continue to read, I believe you will agree there is an enormous opportunity to capture more interactions. Why? Because every interaction a constituent has with your brand is an expression of his or her interest in your brand. By viewing these interactions, you can better understand the depth of a relationship. To only capture or prioritize fundraising information is to only understand part of what makes someone drawn to your mission and your organization.
Here's what was reported on other types of engagement captured across these organizations. (Percentage reflects only those who have these interaction types — all N/A organizations have been removed in the below data.)
Type of interaction …… % of organizations that capture it
- Community/Event Participation …… 83%
- Communication Preferences …… 79%
- Demographic Information …… 69%
- Volunteer Interactions …… 67%
- Call-Center/Donor-Services Interactions …… 63%
- Mission/Cause-Specific Interactions …… 51%
- Advocacy Interactions …… 47%
Perhaps the item that raised my heart rate the most was around mission/cause-specific interactions — only 51 percent of organizations capture those interactions. Again, while fundraising interactions are very important, the engagement around the specific services the organization delivers is critical.
The issue of capturing financial vs. non-financial engagement is one of the areas I went into deeper in the survey. While I didn't want any survey responder to have to run specific reports to answer a question, I did ask responders to quantify how good they were at capturing specific types of donations as well as non-financial transactions. Respondents were given a scale of 25 percent to 100 percent, with the assumption that 25 percent means they felt one out of every four transactions was captured — compared to 100 percent meaning they are very good at capturing these transactions and very few are missed.
As indicated previously, the data below reflects only those organizations that indicate they have these specific types of transactions to capture.
- More than 90 percent of the organizations indicate they capture all (100 percent) of their direct-mail donations, Web donations and membership gifts.
- Between 80 percent and 89 percent of the organizations indicate they capture all (100 percent) of their memorial/tribute donations, telemarketing donations, local office donations and event donations.
- For those organizations that have advocacy-specific donations, 78 percent indicate they capture all (100 percent) of these donations, with the other 22 percent of the organizations split evenly between 25 percent, 50 percent and 75 percent capture rates.
- For those organizations that sell products, only 58 percent feel they capture all (100 percent), with 17 percent feeling like they capture three out of every four (75 percent), 12 percent capturing only half of the transactions, and 12 percent capturing only 25 percent of the transactions.
As we think about the financial tracking and accounting regulations required of nonprofits, it is not unusual to see high estimates for tracking donations. However, it's a very different story when looking at the non-financial interactions.
- For non-financial advocacy interactions, a third of the organizations report they capture only one in four interactions (25 percent), 22 percent of them report capturing only 50 percent of the interactions, and the balance (47 percent) report capturing 75 percent or greater.
- When it comes to capturing mission/program interactions, it is almost duplicative to non-financial advocacy interactions: 54 percent of the organizations report capturing half or less of these types of interactions.
- The pattern follows with preference/interest information, non-financial website interactions and information requests. In each of these cases, more than 50 percent of the organizations report they capture 50 percent or less of these types of interactions.
- Volunteer engagement was slightly better with 43 percent capturing less than half of these interactions, 30 percent capturing three out of four transactions (75 percent) and 27 percent indicating they miss very few of these transactions (100 percent).
While the question about non-financial transactions was only one of the 10 questions, it was perhaps the most alarming to me.
As someone who has spent years understanding what it really means to see the full relationship of a constituent, I've learned that the non-financial transactions are the lowest priority for capture yet often are some of the most valuable indicators of brand commitment and loyalty. As fundraisers of the past, we were drawn to look at donations as indications of the people most likely to stay engaged with our brand. But today's fundraisers have to think more like brand marketers — and sometimes it's simply not all about the money.
Relative to the last bullet above, many organizations would say they are successful because of their volunteers. Yet, based on this study of nonprofits, the data above suggests that only a little more than half of the organizations think just knowing that someone was a volunteer or what specific area for which he or she volunteered or even when is important enough to capture.
Capturing is different than using
The study also included a specific question related to what information was being used in direct-marketing /mass-marketing strategies. The reason I called out this specific area/program in the study is because by their nature, these mass-marketing strategies deal with larger pools of people, and any information that is available to help further segment and target the right donors with the right message is helpful.
Below are the various types of information and transactions, as well as the percentage of organizations that say they use this information in their mass-market programs.
- Donation Information (recency/frequency/monetary) …… 92%
- Community/Event Participation …… 70%
- Demographics …… 57%
- Mission/Cause-Specific …… 54%
- Volunteer Interactions …… 51%
- Call-Center/Donor-Service Interactions …… 39%
- Website Interactions …… 37%
- Product Sales …… 33%
- Advocacy Interactions …… 31%
As expected, the standard RFM has the highest representation across the organizations. But while every organization is different, I would argue that many of these data points can help unlock new ways of looking at your donors. And based on the higher percentages above, the use of event engagement, demographics, mission engagement and volunteer interactions are successful strategies for the direct-marketing programs. Yet we must be careful not to apply the same logic that lower percentages imply testing yet no success. While it sounds trivial to say — and the modelers and analysts in our industry will say it very differently — it simply makes sense that engagement data should be used as we talk to our donors about further engagement.
In summary
Let me be clear — I'm not saying if you start using all the interactions listed above in your direct-marketing program that you will achieve instant success through a larger response rate or larger gift. What I am saying is that the closer you can get to your audience, the better results you will have. These are not "data points" — they are actions your constituents have taken with your brand. So when you talk about your brand with them throughout the year, why would you not want to consider what they have already done with you outside of just the standard RFM?
In some ways I am disheartened by many of these findings. In others I absolutely believe that our answers five or 10 years ago would be much, much worse. Our industry is making great strides in this area, and we should celebrate our progress in our ability to capture data. But we cannot lose site of the fact we're not just talking about fields in a database or data points on a graph. This information, if used correctly, paints the picture of how people connect to our organizations — and those connections are critical to helping predict the future connections.
- Categories:
- Data Mining
Vice President, Strategy & Development
Eleventy Marketing Group
Angie is ridiculously passionate about EVERYTHING she’s involved in — including the future and success of our nonprofit industry.
Angie is a senior exec with 25 years of experience in direct and relationship marketing. She is a C-suite consultant with experience over the years at both nonprofits and agencies. She currently leads strategy and development for marketing intelligence agency Eleventy Marketing Group. Previously she has worked at the innovative startup DonorVoice and as general manager of Merkle’s Nonprofit Group, as well as serving as that firm’s CRM officer charged with driving change within the industry. She also spent more 14 years leading the marketing, fundraising and CRM areas for two nationwide charities, The Arthritis Foundation and the American Cancer Society. Angie is a thought leader in the industry and is frequent speaker at events, and author of articles and whitepapers on the nonprofit industry. She also has received recognition for innovation and influence over the years.