Why Donor Management Software is the Heart of NPO’s

Donor Management Software  should be at the heart of all nonprofits.

Like it or not, a nonprofit organization is a business, just as much as any profit-making business.  While the profit-making business has the “Great App” or the “Super Smart Service”, the nonprofit should be focused on building relationships which support their cause and mission.

But, what keeps a business continuing is information–more precisely, the proper disciplining of that information.  And how do you maintain that discipline and process? In successful businesses today, you do it with enterprise database software. In this article, we discuss the importance of having a unified place for the nonprofit to store information about your donors in order to be successful in a NPO’s business today.

The Key to Finding Love with Donors is Data 

It truly doesn’t matter what type of nonprofit you are. Whatever you may call your NPO, in order to remain viable, you need information management & good processes in place.  And, in a nonprofit organization, donor management software is the tool which may be the key to helping your nonprofit develop strong relationships with your donors today and long-term.

Alyce Lee Stansbury notes that donor software for nonprofits  “is not a luxury.”

“It’s a critical fundraising tool designed to maintain constituent records, process and track donations, acknowledge gifts promptly and accurately, establish fundraising goals and track progress, manage different fundraising campaigns simultaneously, identify major donor prospects, analyze fundraising results and increase fundraising effectiveness. It is also designed to track relationships, affiliations, notes, and other significant information. Properly utilized, donor software can significantly help staff and volunteers achieve their fundraising goals.”

The Field of Options

The good thing is that there are a number of donor management software packages in the market.  And, the bad thing is that there are a lot of good packages on the market. It can be a full-time job to find what the right size is for you. So, don’t get your heart set on any one before you answer some questions about your organization and its goals, such as:

  1. What do you want the software to do for your organization?
  2. What will be the total cost of ownership?
  3. Can all of your people use it?
  4. What do we want the ROI of the Software to be?

The Main Functions to Consider 

Some of the functions that donor management software needs to perform:

  • Accounting (A critical issue, since nonprofits have to submit yearly Form 990 reports to the Internal Revenue Service.)
  • Managing donors & membership
  • Managing grant applications (if your organization seeks grants)
  • Management of volunteers (if outsiders assist your organization)
  • Marketing & outreach
  • Website e Commerce

If you are running a nonprofit association with a foundation, specialized association management functions along with some of these features may need to be considered:

  • Preparation of financial statements
  • Fundraising
  • Membership Management
  • Certification management — for example, if it is a sports organization, do you certify coaches or referees?  Or, to use the Russian literature example, do you validate that your members have done X amount of work in the field?
  • Committee management — do you have Committees on X, Y, or Z, do you certify their membership on these committees, and do you record their work?
  • Content management — if you publish anything, how do you manage its distribution?

We spend a ton of time and resources researching options so you don’t have to. Use us for that! If you have further questions then please contact us. Until next time, keep SmartThoughts in mind.


If you are seeking a Donor Software for Nonprofits , don't search without reading this!

Maximize Fall and Year-End Fundraising by Using the Right Donor Management Software

Fundraising Software from SmartThoughts

Donor Management Technologies and Strategy

It is no secret that many nonprofits and foundations rely on year-end donations for a large percentage of their annual giving. It’s clear for many you need to be sure that your donor management software is up to the task. In this article, we wanted to take a look at these proven strategies you may need along with the right technology to start thinking about now to be ready for the months ahead.

We know that it is still summer, but it is also the perfect time to plan your year-end campaign. If you put things off until December, it is going to be too late. According to Charity Navigator, most charities receive about 40% of their annual contributions in the last few weeks of the year. By getting an early start you can extend the giving season and celebrate a better new year.

Sending Out your fall and year-end appeals: 

Many organizations get their best results by sending out three or more appeals timed around late summer, Thanksgiving and the middle of December. Use a combination of email and mail efforts. Segment your high dollar and major donors for more personalized communications with your donor management tools found in many integrated fundraising software tools like The Databank. 

Data Enhancements and Data Intelligence: 

Before you send anything out, this is the time to take a look at your donor database records. A trusted data quality expert like Updentity can help your nonprofit reach-out to constituents and donors in a more effective manner by appending quality data profile records before you spend a dime on postage. Using state of the art technology, Updentity is able to analyze your database and donor history. With this analysis, your organization could obtain a prediction including which of your donors are most likely to donate.

Google Ad Grants: 

Google Ad Grants is the nonprofit edition of AdWords, Google’s online advertising tool. Google Ad Grants empowers nonprofit organizations, through $10,000 per month in in-kind AdWords™ advertising, to promote their missions and initiatives on Google.com. You have time now to take advantage of this awesome offer. Use the advertising to drive memberships, newsletter subscriptions, social media engagement, volunteers and sponsors. Ads can increase revenue through new donors, advertising opportunities, event attendance, traffic to your online store, and more.

Making solicitation and Thank You calls: Social Signals from Nimble CRM from SmartThoughts

Taking the time to call your donors (see great blog article from Pursuant) increases giving dramatically. Round up as many people as you can including your staff, board members and volunteers to staff the phones. Ask people to follow-up with their personal prospects. Give them briefings when they are calling people they do not know and update your files with the data you collect. Know as much as you can about your constituents before you make that call. Monitoring what your contacts say on social channels is every bit as important as reading their emails. Today, we are fortunate to have CRM tools like Nimble CRM which can add considerable value to your existing donor management software tool to provide social insights (if feature not in current Donor Database). Further, you may consider getting financial profiles for your donors and prospects before you call via a service from WealthEngine.  This type of data (Social and Financial) via various tools is an awesome combination for many development officers!

Video Email for Enhancing the Ask:

This year, maybe it’s time to do something different to increase annual giving via a new technology. We have been using an awesome new video email tool internally, and it’s great for nonprofits too. With Video Emails, you may send holiday & special occasion greetings, send targeted messages to specific groups, share updates on missions, projects, & goals. It’s very impactful and could greatly increase the power of your message.

Implementing your digital strategy: 

Online gifts can come from any source, and they have been representing a larger share of year-end giving each year. Harness the power of your website via donor database tools like StayClassy and social media. Create a splash page on your website asking for contributions the last 48 hours of the year. Use social media updates on an ongoing basis to reinforce your campaign.

These are a few of my thoughts on ways to plan now for the end of the year in the heat of the summer. What ideas do you have?

As always, Contact us for expert advice on the exact nonprofit software automation you may need for your year-end giving campaigns. Until then, keep SmartThoughts in mind.

Is Lowest Price The Priority in Software Decisions?

What is the Real Price of Software
It’s hard to believe. Not much has changed with regards to the software selection process in the last two decades. Today, as it was way back when, price seems to always get more importance than necessary in finding the right software to address the needs of an organization. In this article, I will address the misconception that the “Price” of software is the most important “Pain” to overcome in software selection success.

Nonprofit Software Selection: Is Lowest Price The Priority?

First, I suggest you take three quick minutes to enjoy this very amusing video below. And, stay till the end, it will certainly add value as you review the rest of the article:

I believe this video encapsulates the thoughts on the “weight” of “Price” in many people’s mind. But, as a very sage software executive once stated the following to me, “The biggest cost of software is not price”. “No”, he stated very confidently. “The greatest cost of software is when the software does not work”. Suffice it to say, that statement has stuck with me for quite some time.

Unfortunately, I see it in almost every software search engagement. The more inexperienced the “Buyer” the more heavily “Price” weighs into the equation to buy. Of course, it’s important to have a realistic budget, but solving the problem should always be the #1 goal. If you cannot solve your operational problems, there is no need to spend anything. But, for some what trumps everything else is “Price”.

Price is always at the top of the List!

People buy software systems all the time. Well, not exactly. But, those who have been through one realize that you learn quite a bit from being involved in the experience. That said, there is actually data to support this as well. In a study reputedly attributed to Big 4 accounting firm Deloitte & Touche years ago, they studied the responses of people who went through the process to select and purchase software systems. The study aimed to know how experiences varied between “inexperienced” and “experienced” buyers.

In their survey, the consulting firm sought input from folks who were first-time buyers of software systems “inexperienced buyers” versus those tagged as “second-time” or “experienced” buyers. In the study, the consulting firm asked each to rank the importance of various key purchase factors, each group ranked their concerns as follows.

To less experienced buyers, the survey recipients were provided a list of priorities in software selection and asked them to rank them on a scale of 1-5 accordingly (1 being highest). After the results were tallied, Deloitte found the following results:

  1. Price of Software
  2. Ease of Implementation
  3. Ease of Use
  4. Ability to fit Business
  5. Features & Functionality

For experienced buyers (2nd time buyers), the same criteria was furnished and the results were almost completely inverted even with the same options. Here are the results in this sample:

  1. Support of Provider
  2. Track record of Success in Supporting Similar clients
  3. Ability to Fit Business needs
  4. Growth Potential
  5. Price of Software

For some, these findings do not shed anything new here. In fact, it mirrors the results from a similar IBM study performed years ago which has been cited numerous time by various sources.

Other Factors Should Trump Price

For good reason, the decision to make a software change is not usually taken lightly. It’s certainly not something which most wake up and are eager to do. Therefore, selecting a software solution should be based on sound fundamental business factors. Company strength, product support, and certainly the underlying technology is much more important in your final decision. An organization cannot afford to buy something that is obsolete or something that is unproven despite being “Low Cost”.

And, the key factors in the decision should be geared towards answering questions such as these:

  • Will the proposed solution (software & service provided) help us solve our key business objectives?
  • Does this tool give us the best chance to achieve the vision we outlined for success?

Every organization is “unique” just like every software system has it’s own “uniqueness” which makes it more valuable than the alternatives. The “Best software“, whatever category (CRM, ERP, Marketing Automation, Nonprofit Database etc.) is one that solves the majority of your business challenges and propels your company mission forward. And, just like every other major investment which you put your hard earned dollars into, it boils down to the return on investment of the decision. If the software fails, your ability to reap a return is nil. Price is a moot point then.

Relevant Experience Matters

Perhaps the most challenging aspect of software selection for most organizations, is not having the time or experienced players involved in a selection project. Even before the knowledge of these findings, it has been my experience that when the proper executives are not involved in the process, “Low cost is the priority”.

So, why is price the most important factor in a software buying decision? Here are my thoughts in answering that question:

  • Lack of experience: Without question, experience plays a role here. We learn so much by going through the process. Most organizations do not switch enterprise software very frequently, therefore, “The Team” on staff never has the chance to learn.
  • Chutzpah: Typically, a delegated representative can’t or won’t challenge the budget which is set. How likely is it that a staff person will go out of it’s comfort zone to push the envelope on issues of importance?
  • Time to Decide: The pressure is overwhelming to make a decision. For many, merely keeping up with their regular day to day activities in order to “stay above water” while juggling their “real job” is a drain. In most instances, a delegated staff’s day to day activities will trump the attention and due diligence needed to find a new enterprise wide software tool. And, who can blame them for that!
  • The Path of Least resistance: Who will argue if you offer up the least expensive option to solve a problem, right?
    To be clear, this is not unique to one type of company or industry. In my experience, this transpires across all size, classifications, and industries. And, this is something everyone who is involved in the buy/sell process deal with on a regular basis.

Assessment before Software Selection

In our minds, having experience on board during a software search is paramount to ensure success. And, by no means does that experience have to always come from the outside. However, regardless of the source of the resource, an organization must first prioritize their needs and set the foundation for what success will be after acquiring the appropriate tools to address an organization’s challenges. They must be supportive of the process and give the “team” or “project leader” the support needed to help make a smart decision.

In short, “Price” is important, but should never be the driver of a software decision. While it’s likely the easier choice to side with “Lowest Price” for many, the pain of making a wrong choice will be far greater if you leave out the much more important factors in your decision.

Until next time, keep SmartThoughts in mind.

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