What is Fundraising Intelligence and Why is it so Important?
You may have noticed, but we talk about Fundraising Intelligence a lot. And there’s a good reason for that.
We believe in it!
If you’ve never heard of the term before, think business intelligence – for fundraising. In the age of technology, social networking, and an overall overload of information, business intelligence takes data and makes it meaningful.
“Business intelligence is a broad term that encompasses data mining, process analysis, performance benchmarking, descriptive analytics, and so on. Business intelligence is meant to take in all the data generated by a business and present easy-to-digest performance measures and trends that will inform management decisions.” –Investopedia
According to Helen Brown with the Helen Brown Group, “fundraising intelligence is business intelligence for nonprofit organizations”.
The prospect research field started shifting in the way it describes itself a few years ago. New terms were tossed around like “prospect development”, “donor research”, “prospect strategy” as new ways to describe the industry. The truth is, fundraising intelligence is all of the above.
As Helen Brown discusses on her blog here, there was a need to better explain what the prospect research profession was all about and how much more it involved; beyond simply researching prospects. “We’re the knowledge epicenter. We provide information about prospective donors and help organizations manage their systems so they can build stronger relationships with their donors.” In short, fundraising intelligence fuels your major gift program with the intel you need to analyze your data, identify top prospects, and make more educated gift asks to the right person at the right time.
Nonprofit Needs Are Varied
Since every nonprofit organization is different, the way they tackle things like data management, donor relationships, and research is different too. Large nonprofits may have entire development teams devoted to prospect research, whereas smaller nonprofits may have one development person doing it all – research, data collection, and major gift asks.
Fundraising intelligence is the best way to ensure you are asking the right person, for the right amount, at the right time. That goes for any nonprofit, of any size.
The Competition is Real
Now more than ever, nonprofits are finding themselves in competition for funds. Charitable giving in 2017 exceeded the $400 million mark. Based on the 2018 Fundraising Effectiveness Project, charitable giving in 2018 increased 1.63% above the previous year. That’s a lot of cash.
However, according to that report, the actual number of donors has gone down. So that means, more money is being given by fewer donors.
Accordingly, if more nonprofits are focusing on different fundraising strategies to stand out in the market, you should too. And that includes making room for fundraising intelligence.
How to Put Fundraising Intelligence Into Action
If you already have a fundraising intelligence solution, you’re on your way! If you don’t, or are deciding which one to choose, *cough cough*, iWave is the top-rated fundraising intelligence platform in the industry. Don’t just take our word for it though, find out what other people are saying here.
We know a thing or two about making prospect research data work for you. We offer data-driven intelligence on your donors and prospects that you can use in the real world, right now! In a nutshell, we make your job easier and your fundraising outcomes better.
Now that we’ve convinced you, we’ll show you how fundraising intelligence works in 3 steps:
Step 1 – Screen
Wealth screening is a prospect identification process that highlights individuals with the greatest potential of contributing large donations to a particular nonprofit.
A complete wealth screen requires the right data to determine the three keys. Screening isn’t just about finding high net worth indicators like high salary and real estate holdings. And just because a person may be wealthy, that doesn’t automatically mean they are philanthropic. A complete wealth screen will effectively show an individual’s ability to give, their interest in philanthropy, and if there is a connection to your specific cause.
Crafting the perfect wealth screen requires three major ingredients:
1. A list of prospects provided by the nonprofit;
2. Internal data about the nonprofit’s current donors, such as previous donation type and amount; and
3. External wealth, biographic, and philanthropic data provided by an electronic screening vendor.
Use iWave screening and our Insights feature to segment your database into an actionable roadmap of potential donors and find your hidden gems.
Step 2 – Validate and Research
Understand your prospect’s affinity to your cause, history of giving, and capacity. This allows you to prioritize your list and make the most of your time
Unfamiliar with defining a prospect with the Three Keys in mind? Here is the breakdown:
PROPENSITY: Has this person given to nonprofit causes before?
Giving history, or lack of giving history can give indicators about a prospects propensity. A donor may give minimal amounts frequently, while another donor gives a large gift yearly. Another donor may donate time rather than funds. There is no universal “perfect” donor, each nonprofit may consider the examples just shared as ideal to them. Past behavior is a big clue when looking to find donors with propensity to give.
AFFINITY: Is this person passionate about your cause and nonprofit organization?
Often, your best prospects are already in your database. These donors have a history with your organization. This will make it easy to evaluate your relationship with these donors and recognize new opportunities to develop these relationships further.
CAPACITY: How much wealth can this person afford to donate?
There is no universal formula for capacity ratings. Consider the following:
Income – Generally capacity rating is 10% of income
Real Estate Holdings – popular and reliable source used to calculate wealth
Stocks and Assets – used to generate a baseline rating
Charitable Giving – Calculating baseline capacity is the average of total donations by year, multiplied by 5
Step 3 – Share
Compile and share your new list of detailed prospect profiles with your development team and put confidence behind your next major gift ask.
Why is Fundraising Intelligence so Important?
No matter what you call it – prospect research, donor research, or fundraising intelligence – the strategy behind your team and the tools you use are important. Your nonprofit and the work you do matters. Fundraising intelligence fuels your vision to create a better world by bringing new investors to your cause. Fundraising no longer has to be sustained by assumptions and guesswork. You can base your major gift asks on data and research found in iWave, and ensure you are making informed, evidence-based major gift asks that will result in raising more major gifts, faster.
Fundraising intelligence is the best way to ensure you’re asking the right person, for the right amount, at the right time. This goes for any nonprofit of any size. And with more competition than ever for donors, making sure you have the best approach, and the best tools for the job is imperative.
With the right platform, you should be able to:
- Screen, segment, and prioritize your database
- Validate and research
- Share your findings
Want to see iWave in action? Book your custom demo!
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