Major donor prospect research is a building block of a well-formed fundraising strategy. The goal for nonprofits is to secure major donations, which are the lifeblood of any nonprofit organization.
To do this, it is crucial that precious time is not wasted on leads that fizzle out. Ensuring that you are focusing your efforts on prospects that are likely to financially contribute to your cause will help cut costs and time, ushering you to the fundraising endgame sooner.
However, major donor prospect research is a much more detailed process than many new fundraisers realize. You cannot rely on gut feelings or a small amount of information. Major donor prospect research runs deep and is an involved process. There is a specific set of steps that will lead you down the path to securing a large donation.
What Is Major Donor Prospect Research?
Major donor prospect research is the foundational inquiry on which you will base your future fundraising strategy. This type of work digs deep into personal histories and financial track records. You get to know information about prospects that most people never know, and you make a calculated decision about whether cultivating a prospect appears lucrative or not.
While major donor prospect research includes analyzing wealth markers, it also identifies willingness to give. Discovering not only financial capability but an affinity for philanthropic giving can indicate that a prospect is someone to approach for donations.
The importance of major donor prospect research can help you target specific people for planned giving newsletters, which drastically reduces the amount of money spent on up-front costs associated with direct mail.
This type of exploration can also uncover prospects who may be recipients of generational wealth transfer, opening doors for future solicitation and broadening your pool of prospects.
Who Does the Work?
There are several ways in which a nonprofit organization may begin conducting major donor prospect research. For an organization that does not have lengthy experience in this area, the task may seem a little daunting. An executive director who is juggling many balls at the organization may not have the time to put into the depth of inquiry required for high success levels.
If the organization is willing to take on the challenge itself, it is highly advisable to assign one person (or a team of people) to the role. This person should be someone highly attuned to the fundraising efforts of the organization, and, ideally, a professional fundraiser. A single person in this position can then devote time and work hours to gathering the gritty details about each prospect.
If you run a larger organization or have a budget to help with fundraising development, you can hire a consultant. Fundraising consultants are highly skilled at major donor prospect research and often have many years of experience in identifying possible donors. The investment often repays itself tenfold, as it expedites the process and allows your staff to put their energy into your fundraising endeavors.
A consultant already knows the ropes and can use the tools of the trade to produce results quickly. Where an inexperienced staff member within the organization would face a steep learning curve, a consultant can easily target and highlight potential donor sources. The consultant can dig deep into donor psychology and help you craft a donor-centric marketing plan.
What Should the Data Include?
So, what kinds of data are you looking for with major donor prospect research? Financial data, real estate holdings, and past behavior all play a part in identifying potential donors.
Fundraisers use wealth markers to highlight a prospect’s financial capabilities to give. If they own property or have a higher-than-average net worth, you may find that this person will become someone with whom to improve relationships in the future.
More importantly, major donor prospect research gets down to who the prospect is as a person. Does this person have an established relationship with your nonprofit? Has he or she donated before? Has the prospect donated to political parties in the past? With whom does the prospect network on a regular basis?
Understanding the psychology of your prospects should make up a huge proportion of your major donor prospect research. Wealth markers are important, but they must coincide with an affinity for charitable involvement. After all, some people will donate their last dollar, and others will keep it in their pockets.
What Tools Should You Use?
There are plenty of resources that can help you conduct in-depth major donor prospect research. Some are inexpensive options, and some require a monthly or annual subscription. Taking advantage of tools can speed up your major donor prospect research process and get the charitable donations flowing quicker.
Candid is the newly formed collaboration between The Foundation Centre and Guidestar. This resource offers a wealth of information that can help you keep a pulse on what is happening with other nonprofits around the world. It tells you where people are donating, and to which types of campaigns. This information can help you cater to your prospects, and, hopefully, encourage them to open their wallets in support of your mission.
When checking for real estate listings and property holdings, you can use Zillow as a tool to help identify previous property purchases by prospects. This can help you check off some boxes in your wealth screening without a lot of hassle.
LinkedIn is a highly useful tool when conducting major donor prospect research. You can check education levels and previous employment positions. This is also a great resource for identifying potential networks and relationships with previous donors. Using this information can help target your campaigns or fundraising events.
Donorly is an excellent tool for organizations who want to do most of the work themselves but could use just a little help from an expert. Donorly offers a subscription, which allows you to use it for as few as 5 hours of work a week, just enough to bump up your search efforts.
What Do You Do When You Have the Data?
So, now that you have all this data, what do you do with it? If you have a fundraising department or are working with a consultant, they can help strategize a plan for targeting the identified prospects. The executive director can then approach the topic with the board of directors, and they can approve the plan or suggest changes.
If the executive director has completed the major donor prospect research independently, or if there is only one fairly inexperienced fundraiser on the team, a strategy can be formulated in cooperation with the board.
Your query should help you formulate a plan for the types of marketing campaigns you launch, the number of times you send planned giving newsletters (and to whom), as well as which types of donor-centric events you can plan throughout the year.
Conclusion
Major donor prospect research should be treated with the time and effort that it deserves. Brushing this task under the rug could make the difference between struggling in future fiscal years or starting an endowment.
It is essential that your organization conduct research in a method that is organized and thorough and that you obtain data you can formulate into actionable steps. Major donor prospect research should be a priority for both small and large nonprofits as it vastly increases your prospect pool.
