It’s a reality that nonprofits must work hard to attract and keep donors’ attention in today’s world. There are a zillion worthy causes out there. As our world becomes ever smaller through social media, you may find that your organization must solicit farther and farther afield to acquire donors who will be loyal supporters year over year.
As your organization develops new and existing donors, utilizing the information in your donor database to identify and cultivate these supporters is critical to your group’s ability to engage with them authentically. One of the most effective ways to utilize your donor information is to break the roster into meaningful segments and organize your donors by categories that allow for meaningful interactions. Donor segmentation enables your organization to craft better fundraising strategies and make informed decisions about your outreach.
Getting Started with Donor Segmentation
No hard or fast rules exist around donor segmentation. Common categories include gift size, address, and programmatic interest. These can all be valuable segments but also look beyond the most obvious. Spend some time identifying what kinds of categories might be meaningful for you, and then sort your donor lists by these categories. For example, do you notice a large pool of donors who give annually during the same month? Segment them into a calendar-based category, and solicit them right around the time of their habitual gift – rather than waste effort (and money) on a poorly timed solicitation that gets ignored.
Do you have age-related programming or fundraising? Segmenting by age cohorts can prove helpful and reinforce the value of capturing this demographic information if you don’t already. For example, one cultural institution wanted to ramp up its planned giving program and wondered how to target a desirable audience. When the group turned to its donor management software, they realized that, in fact, they had NOT been capturing birthdates (or at least birth years) and this valuable data point was missing in the discussion of planned giving outreach. What a lost opportunity!
Understanding Different Types of Donors
Donor segmentation can be as creative as is helpful to your organization – you don’t have to stick to traditional categories like age or zip codes (another useful segmentation). The real value of segmentation is that it can allow you to craft a variety of practices and strategies specifically for that cohort. An organization may choose to segment its donor population into many groups – allowing for smaller groups rather than a few large ones – which then lend themselves to personalized contacts. For example, it’s more effective to write a fundraising email that begins “Dear Mary” rather than “Dear Friend.” By segmenting into smaller cohorts, you allow for more personalized touches.
One typical segmentation that illustrates this last point is related to the above point about calendar segmentation. At one organization I worked with, we segmented SYBUNT and LYBUNT donors by month. If a patron supported us the prior March, for example, but not this March, then I hand wrote a short notecard that said, “Last year at this time, you supported us with a $100 gift. Would you consider renewing this gift or increasing it to $150?” I hand-wrote about 20-25 notes a month over three months, and in one month alone, those notes brought in more than $10,000. Through segmenting, the nonprofit offered individualized touches to “smaller” donors (no gift was larger than $500 for this cohort) and cultivated another year of loyal support.
Donor segmentation can inform and support any nonprofit’s creative cultivation and solicitation efforts. Be sure to choose relevant segments and make the most of the information your database captures to make new friends and keep old ones!
Published: June 22, 2022