Donor Prospecting: Boost Your Fundraising Strategy (A Guide)

DonorSearchOctober 20, 2020

As a nonprofit professional, you know how important it is to collect data about your supporters in order to establish personal connections. This is even more important nowadays. With a global pandemic increasing the overall stress in society, your organization’s latest campaigns may have momentarily slipped from the minds of your supporters.

That’s why it’s that much more important to catch their attention and ensure your organization’s outreach is up to par. The best outreach leads to the most effective communication, stronger relationships, and better fundraising. And how can you ensure you have the best outreach? Through donor prospecting.

As your nonprofit conducts prospect research and wealth screening to learn more about your current and potential donors, you’ll review data that informs the philanthropic and wealth background of your donors. This background provides indicators about their affinity and capacity to give to your organization. In this guide, we’ll go over what these indicators are, how you can find them, and how they can impact your organization’s fundraising efforts.

Ready to get started? Let’s dive in.

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Philanthropic Indicators

Philanthropic indicators are the aspects of a supporter’s background showing how likely they are to be attracted to your organization’s cause. In short, these indicators show their affinity to give.

What are good philanthropic indicators?

Good philanthropic indicators are those that show how the supporter has been involved with your organization or with a similar cause in the past. These indicators can be found either by analyzing your own donor database or by conducting research on a prospect research platform.

Some of the philanthropic indicators you should keep an eye on include:

  • Past contributions. It’s rare that someone swoops in to begin giving large contributions to an organization. More often than not, they begin at a low level of donating and increase their donations as they grow in their relationship with the organization. Looking at a supporter’s past contributions to your organization can provide insight into whether or not they’re interested in growing that relationship.
  • Contributions to other causes. Look at the contributions supporters have made to causes with similar missions. Supporters (especially millennial supporters) tend to support a cause rather than an organization. Therefore, if you can show your supporters that their donations to your organization will have a greater impact on the community than if they were to contribute those funds to another organization, they’ll be more likely to give to your nonprofit.
  • Volunteer experience. If supporters have volunteered at your nonprofit (or at nonprofits with similar missions), they’ve already proven that they’re passionate about the cause. Therefore, these people may be ready to also contribute financially. Even if they’re not ready to take their contributions to the financial field, they may be eligible for volunteer grants from their employers. You can learn more about how to maximize volunteered time with volunteer grants by reading through Double the Donation’s article.
  • Nonprofit board involvement. Rather than simply looking at the hours supporters have spent volunteering in the office or at nonprofit events, be sure to also consider the time they may have served on a nonprofit board. If they serve (or have served) on your board of directors or on that of a nonprofit with a similar mission, this is evidence that they’re passionate about your mission and would likely be interested in finding other opportunities to give back.

No matter how you collect this information, be sure to save it as a part of donor profiles in your database. This way, you can incorporate it into your strategy both now and in the future.

Why are philanthropic indicators important?

By learning about your supporters’ experience with indicators such as these, you’ll know who to reach out to for contributions, for volunteer recruitment, and for other aspects of your strategy. Understanding donor data from prospect research means you’ll have a list of potential supporters for all aspects of your strategy and can build relationships with those who are passionate about your cause.

For example, you can reach out to volunteers at organizations with a similar cause to become donors or volunteers at your own organization. Be sure to tell them about the impact you have on the community and explain how they can become a part of that impact.

As another example, if you have a vacancy on your board of directors, you may reach out to those who have served on other boards for similar missions. They’ll know the lay of the land and will have relevant experience to lead your organization in the right direction.

Finally, you’ll be able to identify those supporters who are most likely to give to your nonprofit. This means you can plan out your outreach and have a higher ROI for your fundraising initiatives.

All of these benefits allow your organization to become more intentional and purposeful in your donor outreach, increasing your fundraising capabilities and improving your ROI. Philanthropic indicators can really maximize your fundraising efforts.

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Wealth Indicators

Wealth indicators are the aspects of a donor’s background that show the potential capacity for giving to your nonprofit. If they choose to give to your nonprofit, these indicators provide insight into how much they may choose to contribute.

What are good wealth indicators?

Wealth indicators are publicly available metrics about donors and prospects. You can find these indicators using wealth screening technology or by conducting your own research using various platforms (a slower but also effective option).

Here are some wealth indicators that your organization should keep an eye on:

  • Real estate ownership. According to DonorSearch’s definitive guide on wealth screening, those who own $2+ million in real estate are 17 times more likely to donate than average. Therefore, knowing the real estate ownership of your supporters can show you whether or not they’ll be likely to contribute to philanthropic causes. Understanding the value of that ownership can help you determine how much they may give.
  • Stock ownership. Stock ownership is another public indication of wealth. If your supporters own high-value stocks (and if they own many of them), it’s likely that they have a savvy financial portfolio that incorporates philanthropic giving. Knowing their stock ownership details provides insight into that financial portfolio.
  • Business affiliations. Business affiliations not only show a great deal of information about a supporter’s capacity to give, but they also provide details about potential matching gift opportunities. Supporters who are eligible for a matched gift and have a high capacity to give are great candidates to maximize potential financial contributions.
  • Political giving. Those who give to political causes are also likely to contribute philanthropically. Plus, knowing the amount that was given to political causes shows the amount of funding a supporter may be willing to part with for the right cause — a potential idea for fundraising asks.

Like the philanthropic indicators, you should make sure to save the wealth indicators in your donor database. This way, you can save them for later fundraising strategies. Be sure to update the indicators for your supporters periodically because they may change.

Why are wealth indicators important?

Wealth indicators are important because they inform the fundraising asks that you request from your supporters. This means that you can better determine the different levels of donors in your prospect and donor lists, making it easy to plan out your fundraising strategy.

For those who have a high probability of giving according to their philanthropic indicators, you can start analyzing their wealth indicators to see where they’ll land in your fundraising strategy. You may reach out to them to become a low-level, mid-level, or major contributor:

  • Your low-level donors make up the majority of your support base but give relatively small donations. Don’t discount them, though! They’re very important for growing your organization to a wider audience.
  • Your mid-level donors can make up a large part of your fundraising revenue if you’re willing to steward and cultivate relationships with them. However, they’re the most commonly neglected support group for nonprofits. Don’t forget them!
  • Finally, major donors are the smallest group of your supporters, but they make up the largest portion of your fundraising revenue. DonorSearch’s major gifts guide explains that major donations may look different for different organizations. For one it may be $2,000 and for another, it may be $100,000.

However, as you plan out your cultivation strategies and prepare your appeals for different supporters, keep in mind that they’re not stuck in a single category. Your low-level supporters may one day become mid-level supporters and your mid-level supporters may become major supporters.

That’s why it’s important to treat all donors as immensely important and valuable for your nonprofit. They are valuable now, and they continue to grow in value as your relationship grows. Many nonprofits focus all of their efforts on their major supporters. However, you can take some of the insight from your major donor fundraising strategies and implement those tips at other levels of fundraising.

For example, your major supporters want transparent communications with your supporters. They want additional and advanced information about your upcoming campaigns and to provide advice for your strategies. While low-level donors may not need this advanced notice or to join meetings for advice, they also appreciate transparency and will take opportunities to provide feedback on surveys in order to improve your operations.

Donor prospecting is a great way to find new donors and to find new opportunities for existing donors. Use the data you find to strengthen your communications and provide a pathway that you can use to build relationships with all of your supporters. Soon, you’ll have a stronger fundraising strategy and a better ROI.

Schedule a live demo with our partner Bloomerang, and we’ll show you how easy it is to create and automate reports, utilize online and offline fundraising tools, quickly integrate and access all your data, and ultimately create more time to engage your donors.

Filed Under:   Fundraising