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The Most Effective Way Nonprofits Can Increase Donation Size


Nonprofit organizations are up against a mounting list of challenges. Acquiring new donors is becoming increasingly more expensive. Budgets are tight, resources are limited and the market for donor support is extremely competitive. If nonprofits don’t properly reach and interact with contributors, they risk donor lapses or—worse—failing to meet their revenue goals, which could immobilize their cause.

Marketing campaigns and fundraising events are inarguably beneficial, but there are two pivotal changes taking place in the nonprofit world, adaptations borrowed from an unlikely source — private sector business.

  1. Nonprofits are treating donors more like customers.
  2. Nonprofits are maximizing each donor relationship by obtaining a more accurate ask amount.

While it may seem odd to view and treat donors like customers, the relationship nurturing process and the end goal is no different between a nonprofit and a private sector business. Donors (just like customers) must be courted, convinced, closed and, ultimately, converted into brand advocates who will provide long-term support.

As for ask amount — that’s where nonprofits need help. If a nonprofit asks too much, they risk scaring off the donor or insulting them. If they ask too little, they lose precious revenue gain. Traditionally, nonprofits implement some type of formula to gauge an appropriate (albeit guesstimated) ask amount. They may review a donor’s prior gift amount and ask for double, or they may follow an equation like this:

(70% x (Maximum Gift Amount) + (30% x (Last Contribution Amount)) x 120% = New Ask Amount

The problem with this methodology is — it doesn't take into account a donor’s individual proclivity to contribute. It’s no more than an educated guess, which doesn't provide much comfort for nonprofits, who depend entirely on the money they collect from donors, grants and fundraising events to operate.

Luckily, there’s a more effective way to generate accurate ask amounts, and best of all — it doesn’t require complex long-hand formulas or a team of experts to figure.

The key to determining the most optimal donation amount is to utilize predictive analytics.

What is Predictive Analytics?

Simply speaking, predictive analytics use past data (Big Data) to forecast a future event. “Big Data” refers to large data sets that can be analyzed by a computer to identify patterns, trends and associations (especially as they relate to human behaviors). These data sets may be sourced from any place where donor information is found, including: customer relationship management (CRM) tools, email marketing, website activity (from forms, surveys, etc.), social media interactions and more. Big Data for nonprofits may also include information about the donor’s history with your organization, like how long they’ve been on file, what their lifetime donation amount is and how likely they are to lapse.

Taking this idea a step further is “prescriptive analytics,” which takes a prediction—for example, an accurate ask amount for donors—then prescribes actions to increase the odds of getting it.

Easy-to-use prescriptive analytics software like ExactAsk (earlier versions are decidedly more complicated to use) does all the legwork for you, combing the collected information in search of trends, patterns and associations. The result is a scientifically probable result, such as ask amount based on a wide breadth of factual information about the donor.

What Are the Benefits of Predictive Analytics for Nonprofits?

Predictive analytics isn’t just providing support for nonprofits by delivering a much-needed metric. It’s reinventing the entire process by which nonprofits engage with their donors.

The more you know about the people who give to your cause, the better able you are to influence donors, reach them where they spend the most time, speak to them about what emotionally resonates with them and—eventually—convince them to support your nonprofit’s mission, long-term. Knowing exactly what amount to ask for takes this insight a step further. Now, you are also able to maximize every donation your nonprofit solicits, empowering your organization to reach its fullest revenue potential.

Beyond maximizing donations, predictive analytics also provide an unprecedented level of insight necessary for segmenting donor lists. With new information for segmenting, nonprofits can more effectively target each individual donor and tailor marketing messaging to influence a desired action, such as a specific gift amount.

Research suggests listing an exact amount on a call to action (CTA) button inspires a 50 percent more likelihood for action. In other words, a CTA button that says, “Donate $100 Here” will perform better than a CTA button that reads, “Donate Here”.

Finally, nonprofits can use the accurate ask amounts generated for each donor to focus a greater percentage of their budget and energy on high-level donors who are more likely to gift a greater amount and/or give regularly.

Look for a predictive analytics platform for nonprofits that is intuitive and easy to use. They cater to the fact that nonprofit employees likely don’t have time for extensive training on a new tool, and they deliver a solution that simplifies a critical process, empowering organizations to more efficiently and effectively solicit donors. For best results with predictive analytics, nonprofits should ensure their CRM systems, email marketing and marketing automation systems are up-to-date and fully integrate-able with the platform.