Choosing the best donor database software: A buyer’s guide

Donor database software, otherwise known as a nonprofit constituent relationship management (CRM) system, allows nonprofit organizations to track important information about their donors, volunteers, and other supporters. This information is critical for today's nonprofits that need to communicate effectively with supporters across multiple channels.

A good nonprofit CRM system will allow you to segment supporters effectively and optimize your communication, engagement, and fundraising strategies. Therefore, selecting the best nonprofit CRM system is an important project that should be given serious consideration and effort.

This donor database buyer’s guide will cover why it’s important to have a donor database, the essential features you need, and how to choose a donor database that suits your nonprofit. Let’s get started!

Why is it important to have a donor database?

Donor database software is a critical tool for nonprofits. The information stored in donor database systems can be used to personalize messages to supporters, identify potential major donors, evaluate the success of fundraising campaigns, and more. Nonprofit CRM systems make it easy to manage data that is important to nonprofits, allowing them to:

Personalize communications

Having access to your donors’ basic personal information, such as name and email address, will allow you to communicate effectively with them while personalizing bulk emails. For example, you can greet them by name rather than with a generic greeting. Additionally, tracking customized information that is important to your nonprofit will allow for richer, more personalized communications. For example, if you work at an animal shelter, it may be important for your donor database to track what pets your donors own.

Segment donors to create targeted messaging

Demographic information stored in donor database software is used to group similar donors together in order to target messaging appropriately. This data, including information like age, gender, socio-economic status, and education level, is usually collected over time as a nonprofit develops a relationship with the donor. The information is invaluable in segmenting donors, helping you build donor groups with similar qualities that you can message together. For example, you may send more formal written letters to older donors, whereas you may send email communications to younger donors.

Customize donation appeals

A complete record of a donor's giving history can guide you in your future requests. Collect data on donors’ past gift amounts and combine it with your demographic data to create appeals tailored for each individual donor. For example, if a donor regularly gives in December, then you can send a holiday or end-of-year appeal letter to recognize their previous donations and make it simple for them to give again. Your message to a one-time donor or one who gives sporadically would be different, as your priority would be to nurture the relationship further to lead the donor to regular giving.

Build stronger relationships

A donor's motivation and interests can be the most important information in building a meaningful, long-lasting relationship with them. This data usually needs to be stored in notes or custom fields in your donor database, as it is extremely specific to each organization.

For example, an animal shelter nonprofit may want to track supporters who adopted pets from their animal shelter and make regular donations. This signals to the nonprofit that these donors are invested in their success, meaning they are more likely to be open to forming a long-term relationship with the nonprofit. They may also be more receptive to donation appeals.

What are the essential features of your donor database?

Since the benefits of a donor database lie in the information it stores, make sure to evaluate potential donor databases based on that. You’ll want to focus on the core functionality to ensure you can track and display data that is important to your nonprofit.

The most essential features that a nonprofit CRM system must have are:

Secure storage for personal and demographic data

While all donor databases should store key information about your supporters, carefully evaluate how that information is stored. Ask yourself if it’s easy to view and update that information. A good donor database will have an intuitive user interface that allows your staff to quickly and easily enter a new supporter record, find the supporter information they need, and update existing information.

Custom fields

To accommodate your nonprofit’s unique needs, you’ll want to be able to set up custom fields in your donor database to fulfill those needs. Ask the following questions:

Is there a limit to the number of custom fields you can create?
What types of custom fields can you make?
Can custom fields store text, dates, numbers, etc.?

Make sure that you have a good grasp of how custom fields work in your potential donor database. You’ll want it to be easy for you to set up custom fields to track unique information, without needing to involve a software expert or pay for additional services.

Easy-to-view supporter and campaign data

Tracking all of the supporter information you need is important, but being able to view that data in ways that support data-backed decision-making is just as important. Ask yourself:

Can you easily view a timeline of activity for a specific supporter?
Can you quickly see the status of a current fundraising campaign and compare it to past campaigns?

Think through the questions you need answers to every day and take a look at how easily those questions could be answered with the donor database software you are evaluating.

Integration capability

While having a donor database is crucial for your nonprofit, most nonprofits will need additional software to manage email campaigns, handle events, launch advocacy campaigns, and so much more. Some nonprofits use marketing automation systems that integrate with their donor database to handle many of these needs. Since your nonprofit likely has additional software, ensure that your chosen donor database can easily integrate with them to help streamline your processes.

How do you choose a donor database for your nonprofit?

Selecting new software can take time, especially if you are looking for something as central to your organization as donor database software. Follow these steps for a thorough selection process:

Select a project lead. The lead may be your executive director, a board member, or another individual with the knowledge and ability to evaluate software selection with the right priorities.
Put together a project team. This team should consist of two to 10 people who represent those who will be managing and using the donor database.
Develop a plan and timeline. This timeline should cover goals, milestones, and tasks. This will give you an idea of when you want to have your software selected and when you’ll want to have it fully functional and integrated with your nonprofit’s operations.
Identify donor database requirements. These should include both unique requirements that other nonprofits may not have and the most important features that your donor database must have. Focus on the features that are critical for your nonprofit that not all nonprofit CRM systems will have.
Determine your budget range. This can help to narrow down your list early in the process and save you time as you research prospective providers.

Keep in mind that your donor database will be an important part of your nonprofit’s operations, so make sure to create a thorough plan and have a clear idea of what will be beneficial for your nonprofit.

Optimizing communications with donor databases

Donor databases allow you to optimize your communications with donors, volunteers, and supporters alike. With easy access to the information stored in your donor database, you’ll be able to create targeted, personalized messages and appeals to your supporters, resulting in stronger relationships and greater fundraising success. This is why it’s crucial for you to take your time and thoroughly research all your options to ensure your nonprofit’s success with using your new donor database.