From Excel Spreadsheet to Donor Database

Transcription

1 From Excel Spreadsheet to Donor Database Donor cultivation is the key to sustainability for any nonprofit organization. One of the best ways to maximize donations is by properly cultivating current and prospective donors. Correspondence with donors should be strategic, tracked, and personalized as much as possible. The one single tool that will help you more than any other to have this high level of professionalism with your donor communications is your donor database. A donor database or donor management software comes in many varieties at many different price points, and can be the tool that moves your nonprofit organization to the next level. A donor database is different from a regular contact database. The right donor management software can make a huge difference in your ability to raise funds, and maintain donor relationships. Databases take time to setup and implement, but once the initial time is spent, you will see the benefits almost immediately. This month, we will take you through an overview of donor databases, the costs, features, and what you can expect from a new donor management software program. The Value of Organization A suitable donor database offers your organization the benefit of being more organized and most importantly, displays a serious respect for donors. The most successful fundraising organizations have a culture that exudes a tremendous amount of respect for donors. Your organization should portray the attitude that your $25 check means a lot to us. Suppose a donor calls you and says Can you send me a list of the checks I wrote for you in the last 2 years? As your organization currently stands, would this be a simple five minute task, or would this take a lot of time an effort? As your organization grows, this type of request should be handled quickly and efficiently, and is a feature that almost all donor databases have. Does your organization send its donors a list of all the donations they made throughout the year for their end of the year tax-purposes? A gesture such as this will earn your nonprofit a reputation for being accountable and organized. By showing donors how much they donated last year, they will feel compelled to donate the same amount, or more, the next year. A system like this will give your donors the impression that you are really counting on that next check, and a reason for them to continue giving. It s been said that your best prospect for the next gift is a current donor. If this true, then why wouldn t you want to have excellent records on who gave most recently, what, and why? Remember that information is power. The more you know about your donors the better a position you are in to serve them by letting them serve you. What are your donors trying to accomplish with their dollars? What are they passionate about? And while you re at it, you Cathedral Consulting Group, LLC Page 1

2 should keep track of their birthday, how many kids they have, and where their summer home is located. Every time they give you a check everything should be recorded. You need to learn as much as you can about your donors and capture it in an objective database so that the entire organization, and those who come after you, can benefit from it. Prioritizing Features When choosing a donor database, you will find different features and benefits. Start by identifying which features are most important to you. Not all donor databases have the same features. Most have similar features, but the quality of those features and the costs associated with each feature are different. For example, an event management feature may not come with the basic software package and will cost extra. When deciding on a donor database that fits in your budget, you need to know what you are looking for, and what you can afford. Since donor databases come in all different sizes and varieties, we recommend looking at the different features and prioritizing them based upon the needs of your organization. Look at the descriptions below and rate each feature according to the following rating system: A = Need B = Want/Willing to pay extra C = Want/Unwilling to pay extra D = Not important Managing Constituents. This, along with adding/tracking donations are the primary components of a donor database, and may be the most utilized feature. Organize and track your donors, prospects, volunteers, board members and staff. A few features in this category include: Relationships and Connections: Tracks the donor relationship and/or source is this donor a friend of a board member, the parent of a staff member, or someone associated with a related organization? This type of information is very valuable and can greatly enhance your donation solicitation efforts. Communication log: Phone calls, newsletters, personal meetings, this feature tracks donor correspondence. Some programs will include a reminder which notifies the user (you) when it is time to contact a donor. Donor dashboard: Shows the name, contact information, preferred method of contact, giving history, etc. on one easy to navigate page. Donor databases will have different dashboard options, and some allow the user to customize the dashboard page to their preferences. Adding & Tracking Donations: Gifts by category: Allows the user to track gifts that were given for a certain reason, or put in a specific category (restricted, matching gift, project-specific, general operating, pledges) Searches: When looking into feature of a database, a search method that is easy to use may be important to you. An option that allows the user to search not only by name, but by tax ID, address, or gift amount can be useful. Publication prevention: Prevents duplication of gifts or donors entered. Importing/Exporting gifts: Lets you easily import or export gift information to different file formats, such as Excel. Communication Management: Automatically generates thank you letters, pledge Cathedral Consulting Group, LLC Page 2

3 payments and renewal reminders. Prospecting/Potential Donors: Foundation Tracking: Grant making and grant seeking tools that can track correspondence with foundations such as dates proposals or LOI s were sent, followup call information and foundation interest tracking. Reminders: A function that automatically reminds a user to follow up with a prospect or grant, and allows users to create their own reminders. Mail Merging & Integration Mail-merge: Reaches out to donors with automatically customized letters, mass mailings and s. Some programs have parallel, easy to use label-makers. Correspondence is automatically logged in each constituent s record. Oftentimes, the mail merge interfaces with a Microsoft Word program. Mac users should be even more careful to choose a donor database, because many of them are made for Windows and do not easily adapt to Mac s. Online donation & website integration: Processes credit card donations online and enters the information into the database automatically, correlates directly with website. This feature often costs extra but as online giving grows, making sure your website talks to your database will be a key consideration. Other software integration: Think about the number of databases that are currently in your organization your contacts, your Program Director s cell phone contacts, your QuickBooks list of records, the attendee list from your latest event, a list of people you serve, and maybe one large Excel spreadsheet that you attempt to keep updated. Many databases are great at integrating with your current system, whatever it may be, to make setup easier and minimize the chance of error and duplication. Reporting & Analysis Reporting: Action statistics, campaign report, donor retention report, event statistics, comparative analysis, etc. Report Output: Allows user to easily export reports to Excel, Word, PDF and other formats. Management Event management: Can include registration tracking, nametags, table details, corresponding donations and guest management. Volunteer management: Synchs volunteers interests and availability with jobs, allows volunteers to track their time, and can include a dollar equivalent for volunteer time. Campaign Management: Track all aspects of your campaign including setting goals, adding prospects with individual ask amounts and gift charts. Functionality Of course, functionality is key to fully utilizing your donor database. If it is difficult to use or train a new employee on, you may be making a big investment with a small return. The output is only as good as the input. When comparing databases, check out how these functionality factors are rated: Ease of Use Training/Support (and associated costs) Installation & Maintenance Cathedral Consulting Group, LLC Page 3

4 Customer Service User permissions Customization or Remote access Costs and Comparisons Generally, the cost of a donor database will be dependent upon number of users, number of records, and features or add-ons. Since the costs are so variable from one organization and software program to the next, we highly recommend getting quotes from a few different software providers. You will have a few main costs to consider: Initial Set-up Costs: Purchase of software program Training of staff (including their time commitment) Extra charge for additional users Installation and data transfer Monthly maintenance fee: Flat/Variable/Included New Staff training when necessary Adding new features Customer support Increased pricing as number of records increase. Most database software will have an initial set-up cost, but will charge extra for training, maintenance and support throughout the year. Keep these costs in mind when deciding on a database. The nice thing about the variable cost structure of many databases is that you are only paying for what you need and use. At Cathedral, we oftentimes see nonprofit clients with lavish, expensive databases that are only used for the basic functions, which can be found in many less-expensive options. For nonprofits under $5 million in revenue per year with less than 20,000 records, setup costs range from $0 to $6,000 for one user. Some databases have lower setup costs, but higher annual maintenance and support fees. Support fees can range from $0 to $7,000 per year, depending on the number of users and records. On average, we have found that organizations can buy a database software program, have it setup and staff trained for $500 to $3,000. After that, there are the maintenance and support fees, which you can expect to pay on average of $250-$1000 a year for. This number really depends on the software program and can range much higher. As you grow, you should expect that more features will be needed and additional staff will need to be trained, so be aware of all of the additional future costs involved with your purchase. Some donor databases are free for a limited time, or a limited number of records, but be very careful when deciding on a free database. You may invest a lot of time getting your free database set up, only to find that it does not have the features that you need. If you do invest your time in a free software program, be aware of the costs after the free trial is over, or after you have exceeded the number of records that come free. The prices could go up quickly, and you may end up in a situation where you have invested significant time into importing information, and find it difficult to export the information out. Unless you have an IT person on staff at all times, steer clear of the databases that are just glorified address books that allow you to customize fields and functions (but don t show you how to do it). They are often not user friendly and can end up taking up a lot of your time while producing very little value in return. Be sure the database you invest your time and money into is a donor database, specific to Cathedral Consulting Group, LLC Page 4

5 nonprofits. What you will find more often is donor databases that have a very affordable Basic program, and a more expensive Premier program with additional features. Even if you decide on a Basic program, assume that you will eventually upgrade to the Premier, and take the cost of the Premier package into consideration when comparing databases. Also, ask about the cost and ease of upgrading from Basic to Premier. Many companies will offer incentives throughout the year for your organization to upgrade, so if you are thinking about upgrading, wait until an incentive comes along. Techsoup.org has a great comparison report on low-cost data management software. We recommend reviewing this report if you are seriously considering investing in a database. See Additional Information below for direct link. Be realistic. Ask yourself what is the functionality that you really need out of a donor database and what are the costs? Think about the cost of staff time spent on set up and maintenance of the database as well, since these will be especially high up front. There are several lower cost and less complex alternatives to the large, expensive donor database software programs, so do not jump in right away and purchase the high cost database with all the glitzy features. All too often we find that the excessive features end up being a waste of money, because they are not used or needed. Nonprofits often get paralyzed because they think I can t do this by myself and I can t afford a fancy database program. You can start your database in a simple comma delimited format, and upgrade as you grow. Move to a starter package or basic version with only the functions you need. You can move up from there to the premier version, or add features as they become necessary. By building your way up to what you are trying to accomplish, you can avoid large up-front costs and work into a program that works for you. The added professionalism and accountability that a donor database will bring to your organization can be the ticket to growth and long-term sustainability. Articles for Further Reading 1. Compare Donor Databases: A comprehensive review of low cost donor management systems. donor_management.pdf 2. Ten Common Mistakes in Selecting Donor Databases (And How to Avoid Them) atabases.php Peter Giersch is a Managing Director and Melissa Mason a former Associate at Cathedral Consulting Group LLC. For more information, please visit Cathedral Consulting Group LLC online at or contact us at [email protected]. Cathedral Consulting Group, LLC Page 5