3 Ways to Segment Your Donor Population for Better Fundraising (2024)

What do we want? Donations. When do we want them? Now, yesterday, last Thursday, the foreseeable future, the unforeseeable future.

Why do we want them? If you are a nonprofit looking to carry out your organization’s mission, donations are your means of doing so. Fundraising is rewarding, but rarely easy. Development professionals need to employ the best methods possible to optimize their efforts. For optimization, one of the most used and versatile methods is prospect research.

Proper prospect screening requires strategic donor segmentation prior to beginning. Just like you plan and ready yourself before writing a grant, you should plan and ready yourself before beginning prospect research. Donor segmentation is part of those preparations.

Before performing a prospect screening, you need to pick out which donors from your database need to be researched. The segments you create are going to have a major impact on your research’s fundraising effectiveness.

Donor segments can range drastically based on organizational need. When looking to increase fundraising through the assistance of prospect research, the recommended segment list narrows.

Try segmenting in one of the three ways below and see an excellent funding return on your prospect research investment.

1. Donor Loyalty: Past giving is the number one indicator of future giving. Segment out your most loyal donors and screen them. Donors with a vested interest in your nonprofit or educational institution are the prime launching point of your research. In regards to loyalty, look for donors who have contributed over a lengthy period of time. Focus more on the longevity of the relationship than the average gift size.By researching your most loyal donors, even if they haven’t historically given large gifts, you’ll be surprised what you can uncover.Potentially, one of your small gifts, recurring donors could be a major gift donor at another organization. A fact like that tells your fundraisers that there’s the opportunity to make bigger asks of this donor and see higher donation amounts come in.
2. Event Attendees: Nonprofit fundraising events are what you make of them. Year after year, galas rake in huge amounts of funding for major nonprofits. Charity golf events are incredibly lucrative and help build corporate relationships. 5K road races can increase mass awareness of your organization through the promotional nature of crowdfunding.Events are a top avenue for deepening your donor pool. Performing prospect research on those who attend will guide your stewardship of all of your newly discovered prospects.Screening guest lists for fundraising events helps highlight attendees of potential importance for your organization. For example, if you research the RSVP list prior to a gala, your major gifts officers can work on furthering their relationships with the major giving prospects revealed by the screening.The attendance list is a valuable segment even after an event. Prospect screening will find your high-quality prospects. Your fundraisers can then go the extra mile with those attendees in their post-event thank yous and follow ups, as well as place them on invite lists for future events.
3. Past Major Donors: And finally, a third segment to research is your group of past major contributors.Donor retention should be a major focus of any nonprofit. Researching and learning all you can about your current and past major donors will help strengthen your organization’s connection to those supporters, and, in turn, increase the likelihood that those donors will continue to contribute to your cause in such a major way. Additionally, major gifts donors tend to be very well-networked. Leveraging connections is a widely practiced fundraising tactic. Prospect research illuminates many of those valuable relationships.A screening could reveal that one of your most loyal major contributors works with a high-value prospect. Your donor could then give one of your officers a valuable introduction to the prospect.Or, maybe one of your donors who gives a large annual donation also works for a company with a generous matching gift program. If you are able to make that donor aware of the possibility and encourage him to submit a request, your organization’s expected gift from that supporter might double.

Donor segmentation shouldn’t stop after these three options. Personalize your approach to segmenting according to your current fundraising needs. For example, if you’re getting ready to start a new campaign, you could segment according to preferred communication channel to ensure donors are being reached in the way that they respond to best.

Think of donor segmentation as a filter for prospect research. With the right filter, you’ll be able to easily mine through the data and spot the ideal prospects.

This guest post was brought to you by Ryan Woroniecki, the Vice President of Strategic Partnerships at DonorSearch, a prospect research, screening, and analytics company that focuses on proven philanthropy. He has worked with hundreds of nonprofits and is a member of APRA-MD.

3 Ways to Segment Your Donor Population for Better Fundraising was last modified: November 6th, 2015 by PGWAdmin