Excel vs. Database: Why A CRM Database is Better

Excel is not a CRM Database

 

Why do we need to spend so much money on a new database? This is a typical question many nonprofit executives get asked from their board and even among themselves. It’s logical to gravitate to something like Microsoft Excel to manage those lists & prepare those key reports. In this article, I am going to pick on Microsoft Excel and discuss the impact of using a flat file database as a central repository for your constituent data and why you should consider other database choices.

Why Excel Shouldn’t Be Your Database

The idea of simply buying Microsoft Excel is very tempting. It’s inexpensive, many businesses have experience with it, and after all, it’s made by Microsoft. I get it. On the surface, Microsoft Excel appears for most (your board) to be a logical choice to manage your member, donor, or constituent data. But, the easiest choice and most inexpensive (at least from a hard dollar price) isn’t always the best course of action for your organization.

The Microsoft Excel flaws in managing constituent data

It’s obvious every organization (nonprofit or for profit) has to manage their clients data. In the nonprofit world, we call it something a little different but the principles apply across organizations. We keep track of constituent profile information, record donations, and track gifts. And, most small nonprofits I talk too use Microsoft Office.

So, I concede to you that Microsoft Excel is great with calculating and dealing with numbers. And, in a very archaic 20th century manner it can track your contacts, categorize them for you, and even allow you to make a note on various activities. However, that’s where it ends. There are some fundamental flaws to consider.

What is the Big Problem with Excel as your CRM Database?

Flat File:

What is a relational database? I am glad you asked. From my friends (well, I don’t know them) at Techopedia:

A relational database (RDB) is a collective set of multiple data sets organized by tables, records and columns. RDBs establish a well-defined relationship between database tables. Tables communicate and share information, which facilitates data searchability, organization and reporting. RDBs use Structured Query Language (SQL), which is a standard user application that provides an easy programming interface for database interaction.RDB is derived from the mathematical function concept of mapping data sets and was developed by Edgar F. Codd.

Translated into real language, this means it’s not designed to handle relationships between data, such as when one record (such as a member, donor, customer) needs to link to several other records (like a dues payment or gifts).

A flat file solution like Microsoft is an absolute disaster. First, you have to add a new column for every new piece of contact information; even if only one person on your list has three email addresses, you will need three email columns. You cannot easily link donor pledges to payments, or track “soft credits” such as crediting individuals for corporate matches or gifts made through a family foundation for example.

Relationship Management:

Tracking relationships is an important aspect of major gifts work, membership management, and customer service. Excel is not designed to track relationships between constituents, such as spouses with separate records, members of households, or employment relationships.

Activity Management:

Excel will not notify you of upcoming tasks, like a tickler to remind you to follow up with a prospect, submit a grant application, or send a birthday card. Nor will it alert you to move someone to a lifetime giving club when their cumulative donations reach over $X (e.g., $100,000). It can also be cumbersome to analyze Excel data for complex patterns, such as looking for donors have given for over five years, have a cumulative giving level of over $10,000, and attended more than two of your events.

Segmentation:

Security, reporting, and query options are limited. Anyone who can update your spreadsheet can update everything. It is easy to hit the wrong key and accidentally delete or change data. If you don’t catch an error right away, you better have a good, recent backup on hand.

Data Management:

Finally, if your fundraising program is successful, your spreadsheet can grow very large. Spreadsheets with thousands and thousands of records become hard to view, print, or manipulate. Excel does not provide a rich array of tools to maintain data integrity.

Necessity is the Mother of Invention

I am amazed by some of the ways I have seen nonprofit staffers deal with their lack of technology. So, it’s not uncommon for some to have created some fabulous ways to deal with the challenges of their data by using something like Microsoft Excel to manage their organization. But, with entry level low cost Tier IV cloud based solutions on the market today, it’s a shame that many nonprofits still use Microsoft Excel to manage their most important asset, their people. And, further rely on it to maintain their critical relationships.

Can you get a Donor Database or Member Database for less than $1 Dollar a day? 

Amazingly, yes you can! That is why it is absolutely ridiculous in this day and time to start out with something like Microsoft Excel to run your nonprofit. There are so many relational databases on the market today for even the smallest of nonprofits to utilize which can do so much more than just store data:

  • Member of Donor Management
  • Events Management
  • Website Building
  • Email and Mail Merge Communications Management
  • Community Management
  • Online Payments for donations or dues
  • Development of Forms
  • Reporting

The value of using the best fitted database at your nonprofit

In my opinion, your database should be the intellectual capital of the organization. There shouldn’t be one person or multiple staffers who have different versions of data for each facet of their respective area (Events, Member Management, Donations, Communications etc.). Your database should make it easy for you to look up records, donors, view giving histories, understand the nature of your relationships, and analyze data.

It should be a blessing and not a curse to those who use it.

Selection of a database solution is a critical decision with major strategic and financial implications. When starting your 501 (c) 3 or association, don’t make the error of choosing the easy path to hell using Microsoft Excel.

If you need more convincing, give us a call. We would enjoy having the opportunity to share with you why we believe many of the Customer Relationship Management systems for nonprofits are a better choice for your nonprofit than your Microsoft Excel alternative.

Until next time, keep SmartThoughts in mind.

Database Software for 501(c)3 and Associations

3 Reasons Cookie Cutters are for Baking: Not CRM

Nonprofit CRM develops unique relationshipsEvery person who makes a gift to a nonprofit does so for different reasons.  Some give to reduce their taxes and others for pure altruistic reasons.  None of them have a desire to be treated like a cookie cutter. Being unique, and doing more than churn out plain sugar cookies is prudent, don’t you agree? In this article, we discuss how CRM software for nonprofits can be the secret ingredient in making donors eat your message up.

Using CRM To Bake Up A Unique Donor Experience  

This past holiday, I was blessed to have the opportunity to spend some time with my children. During that time, we spent a lot of time eating. Yep, didn’t we all, right? During this, as a family we usually bake special cookies which tend to be a little different than your average one. In fact, it’s not uncommon to find all shapes sizes and ingredients. I would definitely say that they are usually quite unique. And, my children make one special cookie just for my wife and I to enjoy which is tailored for us.

It’s something about those cookies which despite their imperfections are the best. This experience is similar to what I believe that each nonprofit should try to achieve for their donors. Certainly, this is a lofty goal but each and every time you pick up the phone, accept of donation, or help a member the experience should be unique. It certainly should be different than the mundane “break and bake” cookies which are often bought at the grocery store. While that is ok for some situations, it doesn’t fire me up or get me excited. There is simply no emotion to the experience.

Well, to me those “break and bake” cookies aren’t what donors or members expect from a relationship with your nonprofit. Rather, today’s donors demand individualized desserts tailored to their tastes.  And, for most nonprofit executive’s today this unique experience can be enhanced by Customer Relationship Management Software and solid relationship driven processes to help set their experience apart from all the others.

The game has changed. No longer can any organization, including a nonprofit, maintain the status quo. With more than 1.5 million non-profits, you need a competitive edge. Philanthropists want to see a return on their investment.  No way can you send the same appeal to every investor in your database each and every year.

The goal is to encourage a person to move from a casual observer, to an engaged donor.  It takes work managing relationships.  Donors smell inauthenticity from miles away.  With the right approach and the help from the right technology, you can avoid cookie cutter methods and become a gourmet chef in three areas:

Meet Donor’s Expectations:

Contact Management components of CRM software can help you keep track of trends and predict what may be important to donors now and in the future. Everyone has some kind of an expectation when they enter into a relationship – including a donor.  You have to mind those details, or it will appear like you do not care.

I read an article online the other day which shed some light on this. The Luxury Daily is working with a software management system to meet, and even exceed, the expectations of a specific crowd.  Their plan is simple: Keep in mind future client expectations, understand the consumer journey and identifying opportunities for Chanel to strategically serve its consumers across target segments. The end goal was to identify key tactics needed to create “a personalized, yet consistent experience along the continuum of the lifetime customer journey. After studying expectations, they then began the use of technology to expand brand awareness, strategic partnerships and travel and hospitality experiences. Brand can be enhanced if you store pertinent information about your donors and use it to market appropriately.

Listen Closely to Donors

CRM Software for Nonprofits can help you be a better listener. It is amazing the kind of information people will share on social media channels today.  The good news is this: you can track it through many CRM tools.  Your non-profit can monitor your reputation and provide timely responses to criticism (fair or otherwise) through man CRM tools today.  Social listening is a key to understanding what your donors are interested in today. Also, it is important to track the kinds of events and charity events your donors engage with online.  It is amazing what you can learn, when you really listen.  Good listening is one crucial to relationship management. Store and record in your CRM so that it become the intellectual property of your nonprofit.

Maintain Transparency With Donors:  

Nonprofit CRM can help you keep track of communications, activity history, & even financial data. Sometimes, a non-profit appears shady when numbers and reports are not readily available.  Or, if the non-profit is not accurate in reporting to donors in a year-end document.  In a world where fraud is rampant, accuracy is a must.  You will be grateful for a robust and powerful CRM if a major donor does not believe you are not transparent about how his or her money is spent.  It is not wise to skimp on a CRM with poor reporting features.

While we do not sell software, implement, or train on any particular CRM Software technology, we do believe in the value which they can afford almost any organization who has a sincere desire to do more with less and values the development of sincere relationships with their constituents.

I believe that CRM software along with the proper processes is critical to the success of any type of organization. In a non profit, it can make the difference in reaching a fundraising goal, membership campaign drive, and ultimately reaching your mission or not. There is no greater way to show someone that they are important than by treating them like they are unique. The cookie cutter approach to relationship development doesn’t work.

If you would like to explore CRM software for your Nonprofit or you’d like to place your order for a special cookie please Contact Us.

Until next time, keep SmartThoughts in mind.

Five Sweet Rewards of CRM Software for Nonprofits

CRM for Nonprofit can be a sweet reward for not only staff but your members and donors.

As outlined in my previous post, CRM (Customer Relationship Management) Software for Nonprofits can help optimize your nonprofit’s operations. However, CRM Software can be somewhat complicated to implement so it is prudent for many organizations to contemplate if it is worth the investment. In this article about CRM for nonprofits, I extend my thoughts to underscore the sweet rewards and payoffs a nonprofit may enjoy which justifies the dollars spent and the effort involved to implement at your nonprofit.

Five Sweet Return on Investment Payoffs in CRM Software for Nonprofits

Below please find five important reasons why an investment in CRM software may prove to be “Sweet” for your nonprofit:

1. Streamlined relationship building:

Relationships are crucial to nonprofits. For-profit firms use CRM to have one “home” for all of their customer data. Nonprofits can do the same, to keep track of donors, potential donors, and members. The sweetest return comes when you know enough about them to use the data to provide a stronger experience for your donors or members. You can appeal to what matters most to them.

2. Engagement becomes easier:

Improving relationships is a prerequisite to effective engagement. You know how to create customized communications for different types of donors or constituents. CRM makes it easier to determine who gets what messages and on what schedule. This return coincides with relationship building in many ways. But, if you use the data to “serve” up an experience which is unique, your donors will want to give more. And, if you are a membership organization, your members will participate more often. In short, engagement will bring more revenue long-term.

3. Planning is more efficient:

Creating plans to communicate with major donors, current members, lapsed members, and potential supporters over the year is all doable without CRM, but faster and more reliable with it. Manage development time and money by keeping track of grant application deadlines. Plan ahead for fundraising and membership efforts throughout the fiscal year. Activity Management is a basic tenet of CRM, but the ROI is about keeping the promises you make with each other on the staff and with your constituents. If you don’t, your planning will impact your integrity with everyone.

4. Monitoring is easier:

You can learn about donor relationships, membership management and fundraising effectiveness through a variety of sources, but a CRM software tool puts much of the relevant information in one place, where someone can program canned reports that deliver key information. We can manage want is measured. When your staff and board get accurate data via CRM, you are able to improve your ability to do more in the areas which are important. And, know what to cut when it is not. Monitoring is critical to sustaining ROI.

5. Competition:

Why are all of these things important return on investment scenarios for investing in CRM software, which isn’t free? The bottom-line answer is about the same for nonprofits as for businesses: competition. Your donors and potential members haven’t got the time nor money to participate in every trade association, professional association, advocacy organization, and education program that might be relevant to their needs. There is only so much training money to go around. CRM software can improve your ability to be more competitive by improving the mind share you can capture from your audience.

While you certainly can obtain an optimized organization via CRM Software, your Return on Investment goes even further than just improving efficiencies. CRM can provide tasty strategic advantage which translates into serious ROI.

To talk more about your association’s CRM software needs, or anything else, please contact us. Until next time, keep SmartThoughts in mind.

Free CRM Membership Software Purchase Guide for Nonprofits