Donor Management - The Complete QA Guide for Nonprofits

Craig Grella
November 23, 2021

Relationships are built on trust, and when people trust your message, they’re more likely to engage with your nonprofit. You build trust when people feel a connection to your message, and when they understand the work that you do helps accomplish their own goals. Personalizing your messages is a key tenet of proper donor management and an important function for every organization to master.

This article is comprised of best practices for more effective donor management with tips on using software to track every step of the donor journey. It will help you create new opportunities to engage with your prospects with contextually relevant content and appeals, and deepen the relationships you have with your supporters

[Table of Contents]

What is Donor Management?

Donor management is the process of communicating with your donors, sharing opportunities to engage with your nonprofit, and tracking all the interactions throughout your relationship with them.

Donor management software allows you to collect, retain, and analyze information and demographics on your contacts and to use that information to personalize communication with those contacts — whether through email, direct mail, social media, text messaging, or any other communication method.

Why Is Nonprofit Donor Management Important?

It costs more to find and nurture a new donor than it does to maintain a relationship with an existing one. That’s why donor retention is an important nonprofit KPI to keep track of. The Fundraising Effectiveness Project puts donor retention for 2020 at 43.6%, which is a combination of new donor retention (19.3%) and repeat donor retention (59.6%).

Great donor management helps you retain more existing donors and yields long-term benefits for your organization, including:

  • Richer contact profiles with information your entire team can use
  • A deeper understanding of your donor’s needs
  • Clearer and more contextually relevant fundraising appeals
  • More sustainable and predictable revenue streams
  • More personalized nonprofit marketing automation
  • Makes reporting easier and more useful to your board and grantmakers

Donor Management Software Helps you collect donor dataEffective donor management means quality communication, not just quantity. Simply sending a few extra emails is not “meaningful communication.” In fact, 94% of people who stopped communication with an organization did so because they got irrelevant information from that company (Oracle/B2C). Even though nonprofits enjoy higher engagement rates than most other industries, you still cannot send blanket emails that are not relevant to the wants and needs of your supporters.

Poor donor management leads to a lower engagement rate, less web traffic, fewer donations, and can even impact your nonprofit’s reputation and the morale of your staff and fundraising professionals.

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How Do You Manage Donor Information?

Each nonprofit collects several types of information. What is necessary for one company might not be required for another. Whatever information you do collect, it should always be used to cultivate and improve the donor’s relationship with your organization.

Donor management software plays a key role in helping you centralize large amounts of data and organize it in a way that your team can use it to make more informed decisions.

Donor relationship management systems, like Salsa Engage, can help you stay in constant communication with your supporters. It gives role-based access control and security restrictions, deduplication features to keep your data clean and consolidated, and is an effective choice for improving your donor journey.

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What Are Some Strategies for Effective Nonprofit Donor Management?

To improve your relationships with supporters and donors, you will need to create a good strategy for outreach. The following best practices will start you on the right path:

1. Create a donor journey map

A donor journey map is a tool that can help you visualize where your audience is in its relationship with you and your nonprofit. Sometimes called a nonprofit ladder of engagement, a donor journey map lists the predictable steps a donor might take to learn more about your organization.

Nonprofit Ladder of Engagement helps with effective donor management

Supporters can enter your ladder at any rung and move around the ladder as you communicate with them and send appeals. For instance, a new web visitor might be looking for information about your impact or the type of people you help. This might cause them to sign up for a newsletter, or register to attend an event. In comparison, a more seasoned advocate who already understands the value of your organization might instead be looking for more detailed information they can use to share and get others engaged.

The more you know about what those steps mean to each donor the more effectively you can communicate with them on that step and move them around to other steps as you need.

2. Create donor persona profiles

If a donor map tells you where the supporter might be at any time or the type of communication they might want, a donor persona tells you what content to put in that message.

Donor personas are profiles of your target donor that tell you what that donor is most likely to engage with. It includes their personal traits and preferences like what they read, where they get their information from, who they turn to for advice, and why they might be interested in your organization.

Donor personas tell you where supporters spend their and identify ways you can reach them when they want to be reached, and using the medium they most prefer.

You can learn more about crafting your donor personas in our persona crafting webinar, but you can also start by having personal conversations with your supporters. Ask questions about why they support your organization, what they care about, what their goals in life are, and how they came to find out about your nonprofit before they became a donor. Answering those questions will help you understand their motivations, which will help you craft messages that they will care about reading.

3. Segment your donors

Segmentation is the process of creating groups of people who will receive unique messages about your organization. The goal of segmentation is to understand who wants to receive which message, by what medium, and when they want to receive it. Not every supporter wants to see every message you send, and you should not continue blindly sending every email to contacts who just do not take the time to engage.

You can create a segment for each step on your donor map and each donor persona. Then, when you’ve crafted a message specific to the needs of each group, you can use email marketing software like Salsa Engage to help automate those messages to the different segments.

Remember quality over quantity is the key here. Personalized outreach that delivers relevant appeals is more likely to resonate with supporters and convert them into active donors.

The potential options for segmentation are nearly unlimited. Start with the basics and grow from there. Here are a few segments that can be created from the information most nonprofits collect in their donor management software:

  • By type of supporter:
    • Volunteer
    • Donor
    • Board member
  • By giving history:
    • Not yet
    • One-time
    • Recurring
    • Major donor
    • Last Year But Not This Year (LYBUNT)
  • Cause-related:
    • Cat or Dog person
    • Electric vehicle owner
    • Personal experience useful to your cause (attorney, doctor, scientist, therapist, etc)
  • Unique supporter categories:
    • Health/Medical organizations may track patients, contact info of family members, medical personnel, etc.

Segmenting your list is all about striking a balance between not collecting enough info to create personalized, targeted messages and collecting too much information which leads to complex automation and analysis paralysis.

For more information and tips on segmenting your donors, read our blog post on discovering who your supporters are, or check out our webinar on data hygiene and segmenting your nonprofit CRM.

4. Thank your donors

Not everyone who donates is looking for recognition, but thanking each donor, even if only privately, is a crucial step in the fundraising process and helps create a lasting relationship with your supporters.

Form letters are better than nothing, but handwritten notes are always more personal and appreciated. You can also try other channels like email, social media, or even a well-crafted text message. Look to your nonprofit CRM and fundraising software for details about recent transactions and make sure your letters include that specific information.

If capacity is an issue for your organization, doing stewardship outreach to donors on other channels can be an easy way for volunteers and board members to get involved. For instance, you can organize a phone bank where volunteers make calls or send personal text messages to recent donors to support your fundraising efforts.

Fundraising software like Salsa Engage can also help you automate donor acknowledgment and thank you letters, both through email and direct mail.

5. Share updates with donors

Keeping donors in the loop with updates from your team is a critical part of effective nonprofit donor management. If you’ve got a monthly email newsletter, make sure to include all your donors in that outreach. This can be even more important for potential donors who visit your site for more information but haven’t made a donation yet.

Make sure your newsletter subscription is featured prominently on your website, and when you do send emails make a point to ask your supporters to forward your messages to their friends and family. Putting a message like “Forward this email” with a few icons is not enough – you have to explicitly ask for it and let them know that’s important to your organization’s growth. When you ask for money you frame your appeal with statements of impact. The same goes when you ask for email forwards or social shares – let them know why it’s important to your growth. You’d be surprised at how many people will share your message if you just ask them to do so.

Pay attention to email cadence compared to lower engagement and unsubscribe rates. Your donor management software can track all the interactions with your supporters, so if you increase communication frequency and see a decrease in engagement rate you’ll want to dial back the cadence to a level that is not overwhelming. Email marketing automation software will include email statistics you can track here.

6. Keep donors involved

Our final tip on proper donor relationship management is to offer multi-channel engagement opportunities. Don’t treat your donors like an ATM machine where the only communication they get from you is about fundraising. Invite them to events and ask them to volunteer with a program or in the delivery of a service. It’s possible that your donors may not want to get physically involved with your organization, but it’s still good to ask from time to time. It lets donors know that you’re about more than just the dollars.

This is another area where the donor journey, donor persona, and ladder of engagement can come in handy. Knowing how your supporter got involved and where they are in their relationship with your nonprofit can help you determine the type of appeal they should get and what you can ask them to do next.

Make a point to vary your communication types. If you’ve sent two fundraising appeals in a row, try sending a few informational emails next.

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Relationships are built on trust, and you need to communicate effectively for people to trust you. The content of the message is more important than the number of messages you send, so take care to personalize your message whenever you can.

Look to your donor management system for information and interactions that, when infused into your messaging, will make your appeals more personal, contextually relevant to the situation, and much more responsive to the wants and needs of the person with whom you’re communicating.

If you’re not using donor management software yet — take a look at Salsa Engage and learn more about how it can help you collect and organize your supporters’ information and use it to craft more personalized appeals, and as a tool to help accomplish your overall fundraising strategy.

If you want to unlock more strategic fundraising tips, check out these additional resources:

  • E-Guide to Nonprofit Fundraising on Giving Tuesday - Best practices for communicating your Giving Tuesday fundraising events with email and social templates, a branded donation form template, and a roadmap for 6 weeks of donor communication.

  • Nonprofit KPIs and How To Measure Your Impact - The most comprehensive post on key performance indicators for nonprofits. Download our template and learn how to measure your own nonprofit KPIs.

  • Nonprofit Editorial Calendar - Download our Guide on creating your own nonprofit content and download our editorial calendar you can use right away to help you plan.

  • Want More Volunteers and Donors? - Read our article on the Nonprofit Ladder of Engagement and learn how to engage your audience at every level of their relationship with your organization.

  • Ultimate Guide to Advocacy Campaigns. If you're planning an advocacy campaign our Ultimate Guide to Advocacy Campaigns is the place to start, with communication templates, relationship mapping tools, and more.

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