Applying Consumer Trends to Donor Trends – Part II | npENGAGE

Applying Consumer Trends to Donor Trends – Part II

By on Nov 16, 2010


In Part 1 of this article we learned about The Luxury Institute and its new whitepaper titled Wealth and Luxury Trends 2011 and Beyond.We also introduced the first trend noted in the whitepaper, which I want to explore further in this part of the article.

 To remind you, Trend 1 is Luxury CRM Culture Dramatically Supersedes Operational CRM.  In this portion of the Institute’s whitepaper, the author explores the use of CRM (Customer Relationship Management) tools to help retailers segment, market and communicate better with their customers. For non-profits, using CRM (Constituent Relationship Management) systems have been picking up steam for about a decade.  For us, we look to such databases to better segment, market and communicate with our donors.

So, what else can fundraisers learn from this trend?  I’ll quote from the Institute’s whitepaper: “CRM is ineffective without customer-facing [NP read: constituent-facing] people who use the data to Outbehave the competition and deliver personalized and extraordinary customer [NP read: constituent] experiences.” 

While I understand that we are not competing with other non-profits in the same way retailers are competing for customer loyalty, it is true that we are competing for finite capacity held by our prospects.  Why should a prospect give the major gift to your non-profit instead of to another non-profit they support equally?  Or, why should a prospect make a major gift to a non-profit at all?

The Institute’s sentiment of personalization holds true with the old fundraising adage “people give to people.”  And, it has shown up in a number of other non-profit focused studies such as The 2008 Study of High Net Worth Philanthropy published by Bank of America in March 2009.  This study found that the top two reasons why high net worth households stop supporting an organization are that (1) they no longer felt personally connected to the organization and (2) they decided to support other causes.

To summarize there are two important items.  We must first collect data and information on our constituents.  But more importantly, simply collecting data is not enough.  We must also be able to use it in our decision-making processes in order for it to make a difference.  In one word: Personalization.  Sometimes called donor-centric fundraising, or in the case of the Institute’s article, customer-centric relationships.


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