Are you using your most valuable resource – data – effectively?
Companies across various industries now rely on data analytics to make the best strategic decisions on managing products, services, operations and customers.
But it’s not just for-profit businesses that are taking advantage of the opportunities provided by data. It’s non-profit organisations (NPOs) too.
Like profit-seeking businesses, UK NPOs need to raise money and run more efficiently. This is especially true now since the coronavirus pandemic has hit the sector harder than most.
According to Pro Bono Economics, UK charities faced a £10.1bn funding gap due to coronavirus in 2020, with income expected to drop by £6.7bn while demand for support rose by the equivalent of £3.4bn.
With the climate for fundraising more challenging than ever, where do the real opportunities lie for NPOs looking to use data to stay efficient and top of mind for donors, past, present and future?
Here’s what we cover in this article:
Improve your financial planning and reporting
NPOs have many of the same financial challenges that profit-seeking businesses do, such as:
- Increasing revenue
- Managing audits
- Dealing with compliance.
By analysing your financial data, you can boost the return on your activities.
You’re not looking to maximise profitability but instead get more out of pursuing your social or philanthropic goals while staying on a firm financial footing.
Financial planning is about optimising your activities by carefully managing every aspect of your finances. NPOs have many of the same challenges as private sector companies, such as increasing revenue and handling budgets.
Data analytics empower you to deal with unexpected events, supporting tight controls and compliance, so you have the finances you need to make the most of new opportunities and achieve organisational goals.
At the very least, you need to have transparent financial reporting.
This might mean streamlined auditing with online financial software that can support remote audits, for instance.
Transparency is essential when not only securing donors and sponsors but keeping them on board too.
Optimise storytelling and outreach
Sharing your story with the world is the key to winning the support of donors.
When you have data on your side, you can quickly increase the efficiency and effectiveness of your storytelling efforts.
Data analytics can, for example, help you identify the best donor prospects, provide insight into the outreach methods that are working best, and target those people who are more likely to generate funds, so you can assign enough resources to meet your goals.
With fewer individuals donating to charitable organisations now, using data analytics to engage and nurture your current donor base is more important than ever.
The best place to raise funds is often through your existing contributors.
Staying connected to your donors and communicating your work’s impact can help your organisation remain top of mind when those individuals or organisations budget for their charitable contributions.
Define your metrics and share insights
You can develop a more credible story by mapping your mission to relevant metrics that communicate your priorities and demonstrate accountability.
Your aim here is to show how meaningful your efforts have on the community and constituents you serve.
Define the metrics that best support your NPO goals and relentlessly measure, highlight and share them at every opportunity.
Start with the basics, such as:
- Your funding and sources
- How much gets devoted directly to services
- How many volunteers you’ve recruited
- How many people you’ve helped.
That transparency builds credibility with your donor base.
Next, define and report some of your non-profits’ more specific outcome measures to bring your story to life.
Data can also help you focus your energy on the right donors.
You can dig into your current and prospective donors’ ages so you can tailor your messaging accordingly.
For example, you might find older donors are more likely to give more money a larger donation than their younger counterparts, so it’s wiser to focus your finite resources on them.
Use data to humanise your mission
Data can help you create and maintain connections with new and long-standing donors.
You can’t accomplish this effectively without personalised, real-time data supporting you in engaging, converting and developing that ongoing relationship.
It can also give you information on what your donors care about.
Armed with this type of data, you can understand where to engage your supporters best and measure your efforts in doing so.
Transparency and trust are essential, and you need to ensure they believe in your story.
You can also use data analytics to find out which channels work better for your storytelling strategies.
Again, insights, such as understanding that older donors may use direct mail, while the younger generation might opt for social media and mobile, could be massively beneficial.
Data can support the big human vision you’re setting out in support of your NPO.
When using these outcome measures and stats, be sure to relate them to the real-life examples and stories you have. Build that emotional connection through the insight you draw.
The true value of data stems from the growing importance of digital transformation.
You should make the most of new technologies to justify your budgets and spending, providing evidence that what you are doing is making a real impact.
Create and nurture meaningful connections
Potential donors should know what they’re getting in exchange for their time and money. What do you promise them in return for their support?
This depends on what kind of non-profit you are.
If you’re an educational NPO, you might promise better test scores, for example. If you are involved in healthcare, it might be about taking care of the wider community.
Understand what your story is, provide the right promise to your donors and deliver on it.
Data also allows you to provide real-time insights on where the donations are going, and this is a vital part of nurturing your relationship with donors.
This type of technology has the potential to deliver the transparency and trust you need to foster loyalty and keep supporters on side long-term, so tapping into that is a must.
These insights can also stop you from hammering away at a donor with unwanted messages. You’ll know when to back off when your information doesn’t resonate for them and they’re not clicking through or opening emails.
Engaging donors and persuading them to part with their time and money can be challenging, especially with limited resources.
But if you capture their attention, then educate and inspire them to get involved, you can create a strong emotional connection between your donors and your cause.
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