CRM? Donor Database? Your non-profit needs one


crmIn recent months, I’ve been reminded of the power of donor databases and Customer Relationship Management (CRM) systems. For-profit corporations grasped the importance of gathering customer data a long time ago, which is why they invested in these systems before many non-profit organizations started doing so. I will divide the remainder of this blog post up into sections and share a few personal stories about my experiences in recent months. At the end of this post, I’ll share a few resources to help you with your search.

What is the difference?

I suspect the difference between a traditional donor database and a CRM is getting smaller and smaller as time passes. However, I think the whitepaper at culturehive.co.ik titled “Do I need a CRM or a donor database?” written by Mags Rivett at Purple Vision did a nice job spelling out the technical differences.

Here is how Mags described a donor database:

“A donor database can be anything from an Excel spreadsheet or Access database through to a tool available on the open market or even built especially for you. The definition of a database is usually much more limited than that for CRM: ‘A database is a collection of information that is organized so that it can easily be accessed, managed, and updated.’ (Google Dictionary)”

Likewise, here is how a CRM was described:

“Today, CRM has assumed two meanings. It is both:  a) the approach of successfully managing customer and organisational relationships (be that for business, fundraising or service delivery) and b) the tool which we use to manage the relationships. We think of it as being the 360 degree view of our customers and the work of the organisation.”

Still don’t understand the difference? Don’t worry about it. Please trust me when I tell you:

  • you need a tool like this in order to make your private sector fundraising program run effectively in the 21st Century
  • you shouldn’t just purchase one and think that all of your problems are now solved
  • you need to connect and integrate your other systems with this tool
  • you need to build organizational capacity around this tool (e.g. written policies and procedures)
  • you need to put staffing around this tool

Does this sound like work? Of course it is! But it is worthwhile because this tool will help you build and deepen relationships with prospects and donors, which is what resource development is really all about. Right?

Welcome aboard, Mr Anderson!

IMG_20150414_215128628[1]My husband and I like to take cruises every other year and visit fun places. Over the years we’ve traveled to the Caribbean, Greek Islands, Scandinavian peninsula (and St. Petersburg, Russia), Alaska, and recently the Panama Canal (and Central America).

Over the last 10 years, we’ve only sailed on Princess Cruises, and they’ve collected an awful lot of data on us. For example, they know:

  • Our age
  • Our birthdays
  • Our dining preferences
  • Our entertainment preferences
  • Our drinking preferences (e.g. we’re oenophiles)
  • Our weakness for buying artwork
  • Our desire to purchase off-ship excursion packages

I am confident this information is stored in a CRM of some sort because I see signs of it from the moment I walk onto the cruise ship. The following is what is waiting for me in my cabin mailbox:

  • advertisements for the special wine club membership (for discounts on bottles of wine)
  • invitations to wine tastings
  • brochures for upcoming excursions
  • invitations to purchase tickets at the captains dining table
  • a handwritten card from the art director welcoming me back and inviting me to the first art show

IMG_20150414_191147999_HDR[1]While some people think this level of interaction is creepy, I believe the vast major of people (including myself) find this comforting and convenient. I prefer to think of it differently. I’m in a 10 year relationship with Princess Cruises, and they better know my preferences just like my husband better know my eye color.

Of course, relationship building goes beyond simply tracking my expenditures and targeting special events and offers at me. It includes more fundamental relationship building tactics like sending a bottle of champagne and a hand written note immediately following our purchase of artwork.

Non-profit organizations who use these types of systems are:

  • customizing how they communicate with their supporters (based on the donor’s interests and desires)
  • targeting donors with specific invitations, campaigns and appeals
  • celebrating specific milestones (e.g. birthdays, anniversaries, etc)
  • connecting supporters based on affinity groups and backgrounds
  • managing events and campaigns

I don’t know about you, but this all seems very convenient and helpful to me from a donor perspective. Dare I suggest . . . “very donor-centered“.

Welcome back, Mr. Anderson!

marriottWhen I returned from my cruise at the end of April, I immediately hit the road on a business trip. Whenever I visit this one particular client, I always stay at the same hotel — Marriott SpringHill Suites.

When I checked into the hotel, the front desk person:

  • greeted me by name
  • knew my room preferences
  • reminded me of things that we’ve talked about before

And this time, they asked if I had enjoyed my Panama Canal cruise. The catch is that I had never told that particular front desk person about my cruise. Hmmmmm? I smell the existence of a CRM.

As I said in the previous section, I’m sure there are people who find this kind of stuff scary. However, I find it comforting and reassuring. It is nice to connect with people on a more personal level. In my opinion, it is the essence of being human.

Choosing a system that is right for your non-profit

OK . . . these systems can be expensive, especially when you add in the costs associated with creating systems, hiring people and developing policies and procedures. So, my advice is simple . . .

Treat this decision like you might do so with a marriage proposal

  • Think through what you really need
  • Involve all stakeholders
  • Develop a budget
  • Try different systems on for size
  • Ask lots of questions

I once came across an awesome online workbook titled “Getting the Most from Your Decision: Four Steps to Selecting Donor Management Software” developed by NPower Seattle. I think this step-by-step workbook is awesome, and I suggest you click-through and use it if you are thinking about purchasing a donor database or CRM.

While I don’t endorse products at DonorDreams blog, I have had experiences with certain products that I feel are worthy of your investigation. The following is a short list you might want to look into:

There is no such thing as a perfect product, and you need to find what best fits you.

I strongly urge you NOT to pick-up the phone and start calling sales professionals for these companies. Sit down with the NPower Seattle workbook first and determine your needs and wants first.

Is your non-profit organization using a CRM or donor database? How is that going for you? Please scroll down and share your experiences in the comment box below. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

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About DonorDreams

Erik got his start working in the non-profit field immediately upon graduation with his masters degree in 1994. His non-profit management and fundraising experience numbers nearly 20 years. His teachable point of view around resource development is influenced by the work of Penelope Burk and those professionals subscribing to a "donor centered" paradigm. Donors have dreams and it is our responsibility to be dream-makers because donors are not ATMs.

Posted on June 23, 2015, in Fundraising, marketing, nonprofit, resource development, technology and tagged , , , , , , . Bookmark the permalink. Leave a comment.

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