How do you recruit new employees? That’s always a tough question in the prospect research field.
Partly because there is no college degree in prospect research. High school kids don’t think “Hey! I’m going to be a prospect researcher when I grow up!” Not because it’s not desirable, but because they just don’t know prospect research as a career choice exists. [Read more…]
I’m going to let you in on a secret. Across the US, Canada, the United Kingdom, Europe, Australia, and a growing number of other places around the globe, there are more than 5,000 of us.
People who, at one time or other in our professional lives have faced bias and, at times, even open revulsion from the public or the very people we serve. Most of the time we face well-intentioned misunderstanding without even knowing it.
I can’t stop talking about Big Data when I speak at conferences. I’m excited about the applications Big Data have for fundraising, and I’m not the only one – other prospect researchers, consultants and front-line fundraisers are talking about how Big Data analytics can transform prospect identification and donor engagement (amongst many other things).
For those of you who are new to the term, here’s what Big Data is: super large data sources, much bigger than the information in your Raiser’s Edge or DonorPerfect database. It’s huge data aggregators like the Securities and Exchange Commission or the US Census Bureau. Like Guidestar and Wikipedia. There are even clearinghouses that offer free, direct access to big data sources including websites like freebase, LittleSis and even Amazon (because, seriously – what can’t you get on Amazon these days? It’s not just for books anymore!).
With the recent revelations about the US government’s Big Brother-like access to information through the NSA Prism program, do you worry that the actions of us data nerds in nonprofits could make donors nervous that we’re doing something we shouldn’t be? That question lead me to an article in the Stanford Social Innovation Review by Peter Manzo called “Can Charity Make Big Brother Benevolent?”
Manzo talks about ways that nonprofits/NGOs are using Big Data to effectively deliver essential services to their end users. He shares his vision of opportunities for transforming society that could be possible: for example, based on its use of Big Data, a food pantry or social service agency could proactively offer their services to a needy family in the community who didn’t realize they were eligible for support.
Which could be a wonderful thing.
Or it could signal a step closer to Dystopia. How much individually-identifiable information do we want out there about each of us? For example, in a recent Forbes article, writer Kashmir Hill described the fallout when Target knew that a teen was pregnant before she told her family. The teen’s father was livid (with Target) when she started receiving what he thought were inappropriate coupons. Soon he discovered that Target knew more about his daughter than he did. Target’s data-mining predictors are clearly sophisticated and surprisingly accurate, but as the company’s statistician commented, “…even if you’re following the law, you can do things where people get queasy.”
Yes, indeed. Both the Association of Professional Researchers for Advancement (APRA) and the Association of Fundraising Professionals (AFP) have ethical codes that we in the profession are obliged to abide by. But are they good enough? Do they cover this new era of technological possibilities? And even when we follow the law, will what we do make our donors queasy?
Technology and our ability to manipulate data are advancing so quickly that we have to be confident that our own eagerness and experimentation with what is possible are aligned with our professional compass of what is ethical. Because if not, we’re going to hear about it in the most public of ways and, much worse, it will damage donor trust for a generation.
Is ethics a keystone in the conversations you hear about Big Data and fundraising analytics at the water cooler or at conferences? As enthusiastic as I am about Big Data, I know that we we’ll be nowhere with it if ethics is left out of it.
This year’s AFP/Urban Institute Fundraising Effectiveness Project reported that for every 100 new donors that supported a small-to-medium sized nonprofit in the United States last year, 107 donors left. Even more starkly, “every $100 gained in 2011 was offset by $100 in losses through gift attrition.”
Every year small-to-medium nonprofits are working harder just to break even.
Overall the study found that the largest gains come from new donors and the largest losses came from lapsed new donors.
Lapsed new donors.
These are the friends that should be easiest to keep. You’re still in the honeymoon phase. They’re excited about your organization enough to make a first gift. Sure, some of them will have given because of a road race or a golf tournament or in memory of someone. But most of those new donors should spell opportunity, not the promise of future loss. And as we’ve been told a hundred times, it costs less to retain a donor than it does to acquire one.
For larger nonprofits (organizations raising $500,000 and more) the figures are very different. For the most part, the more money an organization raises per year, the less likely they are to have donors leave them. Their losses due to attrition are cut by half.
So what’s the difference between small organizations and large ones? How are the larger ones able to keep their new donors?
A stronger fundraising infrastructure makes a big difference; overhead isn’t a bad thing when it is used effectively. The report strongly recommends building internal capacity overall and then annually providing extra budget support to the areas showing the greatest opportunities and success. Most of the larger organizations use prospect research to identify the new and renewing donors that have the highest potential to be upgraded. If yours doesn’t do that already, now is a good time to start.
What can you do now?
We’re swiftly coming up to year-end and your organization will, with luck, have an influx of brand new donors that you don’t want to lose next year.
This January, use prospect research – do an electronic screening of those new year-end donors. Apply data analytics to find the hidden gems in your database. Research the ones with the most potential to find their interests and philanthropic capacity. If you don’t have internal capacity, hire a professional. Prospect research may be an overhead expense, but it’s more expensive to keep treading water year after year.
Resolve to keep more of your new donors next year. You can start now.
Next Wednesday, November 30th I’m going to be speaking at a conference sponsored by the Massachusetts chapter of the Association of Fundraising Professionals.
I mention this because it got me to thinking about what I like and don’t like about conferences. I like really meaty sessions at conferences, and I get disappointed when speakers are entirely theoretical or philosophical. I do like the theory and I do like understanding the context, but then I want you to show me how. Or at least give me a roadmap, inundate me with URLs, show me some first steps so I can figure out the rest.
It drives me crazy when the subtext of a session is if you want the real details, you’re going to have to buy my book / hire me to consult for you / buy my product.
Ugh. People come to a session to learn something, and to have practical take-aways that they can use when they get back to the office. Or at least that’s true for me.
So that’s what my seminars are – heavy on the take-aways. Sure, I’ve got a couple of the requisite cartoons and polls to get people chuckling, talking, and sharing. A lot of people in my sessions have cool tools and sites to share that I end up checking out when I get back to my office. Prospect research is like that: new tools are popping up every day, and we do love to share them! I think that’s what conference sessions should be about, too.
My session, Using the Web to Manage Information Overload is going to highlight handy web-based resources that will help fundraisers save time and get to the information they need more quickly. Prospect researchers are welcome too – come bring your best tools to manage information overload and be prepared to share and to take away.
Selected meaty take-aways if you can’t make it to the session:
A terrific research metasite from Northwestern’s prospect research department
Another one from Supporting Advancement
Prospect research Tweeters to follow