INSTITUTE OF FUNDRAISING: MEMBER VIEWPOINT - Donor segmentation is a valuable tool for all fundraising teams

JOHN WILLIAMS, MInstF, chair of the Institute's Midlands region, and trustee of a Birmingham LEA Performing Arts School

A fundraising database, in the simplest of terms, is a record about where the money comes from. While most charities have a database, surprisingly few, other than the large national charities, seem to be using it to its full potential. Donor recruitment is one vital aspect of fundraising but are we looking at the other equally essential aspect of managing our relationship with those donors over time?

Given the fundraising income targets we set, we should ask are there enough known potential donors to support that target and how will we reach it? Can we isolate a group of key donors? Will we be able to find the 5 or 10 per cent who donate 80 per cent of the money? Fundraisers who use a well-managed donor base as a conduit between the charity and supporters will be in the best position to address these points.

Where investment becomes necessary in understanding and profiling your supporters, the key to this management process is undoubtedly segmentation.

This is invaluable information for any campaign but specific segments of donors can also identify those who have a predisposition to give larger gifts and who, therefore, should be singled out for a focused higher-pitched contact.

Segmentation can help to define appropriate strategies for developing a donor over time. The objective of this process is to establish segments that are useful, rather than interesting.

At the most basic level, our focus should be on donor retention. Contented donors equal repeat donors and it is well-maintained, segmented data that is driven by the needs of our supporters which makes it easier for them to make their timely and preferred donations.

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