Advancing Your Prospect Research

By Laurence A. Pagnoni, MPA

A lot of donor information is hidden. Most donors aren’t advertising their net worth or telling us about the other nonprofits they donate to.

So it’s up to us to do the research in advance of our conversations with them.

Three Options

Nonprofits have three options for conducting this research:

  • Conducting In-House Research — Larger nonprofits with the financial means often build dedicated research teams into their organizational structure.
  • Hiring a Consultant — Instead of hiring a full-time prospect researcher or having an existing staff member screen donors, you can bring in consultants like LAPA Fundraising to take the lead.
  • Enlisting a Screening Company — Screening companies can compare thousands of donors against various major databases and help you rank your prospects according to potential.

The Art of Knowing What to Do with the Donor Data

Many nonprofits invest in donor research services that promise to deliver insights about their donors that are not in public view.

Unfortunately, these data vendors overwhelm you with information that is not actionable.

Advanced prospect research cuts through this noise by identifying the most relevant donor data and marrying this information with your cultivation and solicitation path. (We will show you how to use advanced prospect research to increase revenue at our free webinar on June 15 at 11 a.m. ET. Register now. I hope you’ll join us).

Knowing what to do with your donor data is the real art of advanced fundraising. That is usually outside the scope of service of the vendor who sold you the data, but it is of central concern to fundraisers.

Understanding Charitable Giving Indicators

Through years of experience, I’ve learned which data points are most instructive in gauging a donor’s capacity and willingness to give.

We have identified more than 100 indicators. Here are just the top ones:

  • Giving to Other Nonprofits — Donors who give $100,000 or more to at least one nonprofit are 32 times more likely to make a similarly-sized donation elsewhere than the average person.
  • Political Giving — Donors who have given more than $2,500 in federal election contributions and charitable giving are 14 times more likely to donate.
  • Real Estate Ownership — Donors who own real estate valued at more than $2 million are 17 times more likely to engage in philanthropy.

These indicators will help you know which of your current donors are more likely to support your organization at a higher level. They can also help you identify new prospective donors.

Segmenting Your Donors

You should create donor segments. Your donors can be segmented into the following categories:

  • Transformational donors
  • Major donors
  • Annual fund donors
  • “Bread and butter” donors

The criteria for these segments differ from nonprofit to nonprofit — and each of these segments are refined as we conduct further research. Some nonprofits have more than 100 donor segments.

These segments help you better understand the motivation behind each donor group and, in turn, develop tailored campaigns.

You can also use the insights gained through advanced prospect research to prioritize and segment prospective donors — and build relationship maps (RelSci), which allow you to find the fastest path to connect.

Secure Higher Gifts

Prospect research generates donor data that allows you to efficiently surface and solicit donors at every level. You will know the size of the donations to request, or at least the range of past giving, so you’re not asking for more or less than the individual’s capacity to give.

This advanced knowledge increases your likelihood of securing higher gifts.

All of this fuels your organizational growth — allowing you to fulfill your mission.

By investing in advanced prospect research, your nonprofit will have the resources to truly make a significant impact.

What’s your experience with prospect research? Please share this post with a colleague who may appreciate it.

Notify of

Inline Feedbacks
View all comments

Related Posts

Has Donor Trust in Charities Changed?

In this age of “fake news”, “alternative facts” “hyper partisanship” and what seems to be a general erosion of trust, why should we even care?  And if we care what can we fundraisers do about it?

Of course, every fundraiser should care because trust is the lynchpin of a solid and sustainable relationship with a donor.  And because there are ways to measure trust, taking steps to increase the level of trust, and by doing so increase donor value and an organization’s net revenue.

Read More »

MacKenzie Strikes Again

You probably won’t recognize most of the names on the list of the top 50 mega-philanthropists.

MacKenzie Scott’s name, though, immediately rings a bell and puts a smile on the face of those of us serving in the non-profit sector.

Ironically, she is not on that list, unlike her ex-husband.

Yet we love her for the special sensitivity she shows us, and her latest “strike,” an announcement to give away $250 million in funding to small nonprofits, is no exception.

Read More »

The CEO as Chief Fundraiser: A Role That Should Never Be Delegated

Our recent posts have lasered in on fundraising perennials–retention of fundraising staff, annual funds, and why donors give.  Another perennial stacks up as equally worthy of thoughtful commentary, and that’s the role of the chief executive officer in fundraising.  

A short definition of a CEO is he or she who makes decisions.  Nowadays, we recognize the value of consensus decision-making, and that’s fine.  But the kinds of decisions I’m referring to are the big ones, decisions such as those made by the captain of a ship.

Read More »