What does data-driven fundraising actually mean?
Every fundraising organization wants to be it, many fundraisers claim to do their fundraising this way, but only a few know how to implement it effectively: data-driven fundraising. It's one of those terms you hear everywhere. But in practice, it doesn't always go well. What does data-driven fundraising actually mean?
If you gather a few fundraisers around a table and ask them to share their experiences, you'll quickly hear about payback periods. Working in a data-driven way means realizing that it's not about payback, but about making substantial profits in the long term! After all, that's why we do it. Sufficient income for the good cause. The fact that we don't generate profit for shareholders doesn't mean we shouldn't make a profit.
Thoroughly dissecting the business case can save you a lot of financial pain. I once worked with a charity to stop a significant investment after a detailed analysis of the results because, in the long term, they didn't benefit from it. The only one benefiting was an unnamed supplier. Always be critical, don't believe anyone blindly.
But what does data-driven fundraising actually mean?
You try to predict results and explain them afterward. You make choices very consciously based on data. You make investments for a reason. You try to quantify and minimize risks. Communication with donors is as informed as possible based on their wishes and needs. Analyses are as comprehensive as possible because you have stored all necessary variables, and trends are transparent. You try to express the quality of your donor relationships in quantitative values. The ins and outs of your database guide your decisions. Long-term trends are known to you. The investment dynamics of fundraising hold no secrets for you.
That's about it.
You could also call it the business aspect in our non-profit sector.
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