Michael Jordan had Scottie Pippen. Sherlock Holmes has Dr. Watson. Spongebob Squarepants has Patrick the Starfish.
Fundraisers have CRMs.
Nonprofits and CRMs go hand-in-hand.
To successfully execute regular, large-scale fundraising campaigns, nonprofits need the support and assistance that constituent relationship management software provides.
Nonprofit CRMs have three main uses, which are outlined below.
Use 1 — Data Management
This is both a slightly obvious and fairly extensive use. What kind of donor database doesn’t offer some level of data management?
Data management boils down to one thing — keeping donor records.
A nonprofit without donor records is like a car without gas. It may look the part, but it is not going to be able to do much of anything.
Data management is a sprawling category. It incorporates:
- tracking donors
- structuring solicitation strategies
- generating data reports
Let’s dissect those points one at a time.
a. Tracking Donors
A key component of fundraising is knowing your donors.
Learn about your donors. Study your facts. Refresh your memory. Lather, rinse, repeat.
A well-run nonprofit tracks donors over time, updating details as needed. Your CRM can be that tracker and house that information.
Tracked donor details can come into play at any stage of the fundraising process.
For example, one of your development officers may be meeting a major gift prospect for lunch and wants to know any donation history the prospect has with your organization. That officer can check the nonprofit CRM.
The significance of tracking donors actually bleeds into point b.
b. Structuring Solicitation Strategies
The data you collect on donors over time does not go to waste.
In fact, with all the information in one easy to access location, your donor database, your development staff can strategize how best to solicit donors for various fundraising campaigns, improving donor stewardship.
For instance, compare what happens when a fundraiser uses details from the database to solicit a donor who we’ll call Miguel versus using a generic solicitation method for a donor we’ll call Laura.
With Laura, you send out a direct mail appeal to her parent’s home, where she no longer lives. You make a standard ask, but don’t acknowledge that she’s already a supporter of your organization.
With Miguel, your records indicate he responds better to email appeals, so you send a letter over email, through your system. You include a thank you for his past contributions and cater the ask according to his past giving amounts.
Okay, I’ll admit that was an extreme example, but it was used to show what a possible contrast there can be.
That example was on the micro-level, moving out to the macro, with your CRM your development team can segment out all donors similar to Miguel and solicit them in a different fashion than the segment that includes Laura.
Without good, organized data, fundraising starts on unstable ground.
c. Generating Reports
Constituents want transparency. Reports provide that desired transparency.
Many nonprofit CRMs offer report generating tools that will save your staff time. Rather than have team members dedicate valuable work hours to building reports from the bottom up, a CRM will do much of the report creation legwork.
There’s also the added bonus that less human involvement means less human error. Technology is just more accurate.
Use 2 — Fundraising
If a nonprofit without donor records is like a car without gas, a nonprofit without fundraising is like a car without a driver. It’ll never arrive at its destination.
CRMs help with numerous aspects of fundraising, including:
- processing donations
- accepting online donations
- setting up monthly giving
- running crowd-funding campaigns
Running a nonprofit is a complex endeavor. You should aim to consolidate as many aspects as possible, and fundraising is no exception. Using one system for a variety of fundraising tasks makes life easier for your entire development department.
It also never hurts to have software that can essentially run the donation process.
If your nonprofit uses its CRM to take charge of fundraising, all the data input surrounding it should go back into the system as well. This loops back to the first use, data management.
Imagine running a crowd-funding campaign with a third party entity versus as a page designed through your CRM.
Both campaigns raise $15,000. Good news for both campaigns, better news for the one that was run through your CRM’s crowd-funding platform.
Let me explain.
With a crowd-funding platform through your CRM, you’re gaining the $15,000 in donations, as well as valuable donor data on those contributors. The CRM should be able to funnel the information from its crowd-funding platform back to your donor database.
Using a third-party option could result in some serious work for your employees at the end of the campaign. Once the funds are raised, if you want that donor data in your system, someone is going to have to put it there.
This will be easier if your CRM has a bulk upload feature, just beware of simple mistakes in the process that could result in transfer errors, like having all crowd-funding campaign donors’ names categorized as email addresses.
The more arduous option would be having staff input the data one-by-one. That task would take valuable time away from other important work your team could be doing.
Use 3 — Communication Management
Ready for the third car metaphor? Say it with me. A nonprofit without communication management is like a car without a steering wheel. Aimless and extremely unadvisable.
Communication is the foundation of donor-nonprofit relationships.
With appropriate communication strategies in place, nonprofits are going to increase both their donor acquisition and donor retention rates. Weaken the communication strategies and suddenly new donors stop coming in and loyal donors become less and less consistent.
CRM software can satisfy many communications needs, from direct mail to email to event correspondence.
The software makes starting email campaigns just a few clicks away. Your donor list has already been drawn in through fundraising, donor details have been filled in through data management, and now all of that information can be put to good use — donor-centric communication.
Capabilities vary. Find a CRM that suits your communication requirements.
Keep in mind, for all of this, but especially for communications, that the data the CRM has is only as good as what the organization puts in. Frequent database cleanings are needed to truly maximize CRM function.
Auto-filling a campaign letter template for a large group of donors only works if you have consistent details on all of those donors. You really don’t want to send out asks addressed to “donor name.”
When considering all three of these uses, your organization is going to have to rank the three in order of most necessary, and examine that list against what the CRMs that fit within your budget have the capacity to accomplish.
Ideally, you’ll be looking into an all-in-one CRM. In those nonprofit CRMs, all the different uses work in a self-contained system. Therefore, your data can be pulled into and pushed out in various ways, because all of the parts of the system communicate with each other seamlessly.
A strong alternative to the all-in-one model is finding a CRM with most uses built in that sources in outside tools to fill in any holes in the database. These are integrations.
Either way, you want a CRM that functions as a system, drawing together as many uses as possible into one fluid and dynamic donor database. Your CRM should enable you, not limit you.
CRMs are either CD-ROM-based or cloud-based. With cloud-based software you can use it anywhere, as long as you have access to the cloud. Cloud-based CRM software is often treated as a SaaS, or software as a service. The nice part about a cloud-based CRM is that it can scale with a growing organization.
No one CRM is right for all organizations, so the decision is going to be solely based on the nonprofit’s need and capacity.
If you’re looking to learn more, check out our Complete Guide to Nonprofit CRMs here.
And one more car reference for completeness’ sake, before you make any decisions, take a CRM out on a test drive.