You’re interested in moving away from spreadsheets or your current donor management system – now what?

Much of the emphasis that currently exists in donor management systems is placed on table stakes capabilities like collecting donor contact information, analyzing reporting metrics, and filtering segments. The challenge is that virtually every vendor has these capabilities.

Nonprofits need to identify the features that will differentiate a donor management system from the endless options in this crowded vendor space. This report helps organizations do just that, focusing on three pillars that we believe provide true differentiation: security & privacy, data & analytics, and digital transformation. Choosing a system that prioritizes these pillars will strengthen donor trust, improve your understanding of your donors, and enhance your donor experiences.

Monica Pagtalunan
Research Analyst, Industry Practice
Info-Tech Research Group

Nonprofit organizations have not kept pace with evolving fundraising efforts. Attention to the needs and engagement of donors is diverted toward program delivery which leads to diminished funding.

Donor management systems are seen as “just a database.” Your organization may not see the value this system can provide in nurturing donors.

The way you manage donors is inefficient, either due to an inadequate system or the use of a spreadsheet.

The vendor pool is crowded with an overwhelming number of vendors and a rapidly changing landscape with much consolidation.

Your current system fails to align with your fundraising strategy with little to no understanding of what features and functionalities must be prioritized.

Your organization places undue emphasis on cost over other key considerations when defining an approach to donor management system selection.

Break free from the nonprofit starvation cycle, focusing less on cost and more on the value of a donor management system.

Your donor management system must be driven by your overall fundraising strategy, leveraging your business capabilities to determine pain points and to better understand the donor journey.

Gauge the current capabilities of leading donor management system vendors in the space and how they fare in this digital-first world.

A repository that stores and tracks donor information like giving history and personal attributes.

Tools that help communicate with donors, such as email platforms and content templates.

Tools that help nonprofits fundraise, such as “Donate Now” buttons and donation pages.

Support for tracking donor interactions and maintaining relationships.

Reporting to account for donor impact and drive decision making.

36% Nonprofits reporting a funding drop in 2022.
Source: Sage, 2022

How time is spent in the industry:

1% Fundraising

9% Administration

90% Program Delivery

Source: The Giving Report, 2022

Fundraising is a substantial undertaking. There are many different tasks that fall under fundraising, including donor acquisition and retention strategies, marketing and communication, and multichannel oversight. Fundraising is a key area that accounts for a significant portion of nonprofit funds.

Little time is spent in this crucial area. More time is spent on program delivery than on fundraising. Fundraising is considered risky overhead, as it doesn’t directly support the organization’s programs and it’s uncertain how much money will be raised.

Lack of time spent on fundraising will impact program delivery. Fundraising initiatives are meant to fund the nonprofit’s programs. If not enough time and resources are dedicated, it can impact delivery quality, resources, and the satisfaction or wellbeing of the consumers of your services.

78% of the public agree that nonprofits must earn our trust before we support them (Independent Sector, 2022).

Nonprofits heavily rely on donors for support and the exposure of sensitive data can impact their trust and confidence in your organization.

5% of nonprofits use data in every decision they make (Nonprofit Hub, n.d.).

Data-driven donor management is necessary to build well-honed insights, drive decision making, and understand donor impact and value.

60% of nonprofits agree that donors expect better user experience (UX) than their current technology provides (Salesforce, “Nonprofit Trends Report 2022”).

Leverage digital tools that automate tasks, promote growth, enhance donor experiences, secure sustainability, and drive operational efficiencies.

Download Info-Tech’s Strengthen Your Nonprofit’s Privacy and Security Operations

Download Info-Tech’s Make the Case for Your Nonprofit’s Data & Analytics Initiative

Download Info-Tech’s Assess Your Nonprofit’s Digital Maturity

• Increase in average gift size. Illustrates average donation amount in a campaign, donor group, or time period.
• Increase in average giving capacity. Compare with average gift size to see if you’re leaving money on the table.

• Increase in average gift size. Total $ amount of donations received / # of gifts received = Average gift size
• Increase in average giving capacity. ($ amount donor A can give + $ amount donor B can give + n) / Total # of donors = Average giving capacity

• Donor conversion rate. Demonstrates how successfully an initiative encouraged donors to complete an action.
• Donor growth rate. Measure donor growth for overall performance.
• Gifts secured. Measures the number and type of gifts your organization received.

• Donor conversion rate. (# of donors/prospects who completed the goal action / Total # of donors/prospects the goal action was sent to) x 100 = Conversion rate
• Donor growth rate. ((# of donors this year - # of donors last year) / # of donors last year) x 100 = Donor growth rate
• Gifts secured. Number of gifts secured (broken down by major gifts, planned gifts, mid-level gifts, small gifts, annual fund donations, and monthly donations)

• Improved technical system skills. Measure end users’ skills and abilities when using the donor management system.
• Increased donor management system satisfaction. Use net positive score (NPS) to determine satisfaction level with the selected donor management system.

• Improved technical system skills. Key performance indicators (KPIs) include improved training attendance rates, course completion rates, assessment results & learner retention rates.
• Increased donor management system satisfaction. % of promoters – % of detractors = NPS.

• Gift frequency. Average number of gifts you receive from your donor pool each year.
• Donor retention rate. Determines how many donors you retain on a year-over-year basis.
• Donor churn/lapsed donor rate. Determines percentage of donors not retained on a year-over-year basis.
• Positive engagement factors. Measures engagement in various fundraising channels.
• Frequency of contact with donors/outreach rate. Tells you how often your team reaches out to a donor in a positive or negative frequency.

• Gift frequency. # of times your donors give / Total # of donors = Gift frequency
• Donor retention rate. (# of donors who gave last year + This year / # of donors who gave last year) x 100 = Donor retention rate
• Donor churn/lapsed donor rate. (# of lapsed donors / # of donors who gave last year) x 100 = Lapsed donor rate
• Positive engagement factors. KPIs include event attendance, email open rate, click-through rate, opt-out rate, website page views, and social media conversation rate.
• Frequency of contact with donors/outreach rate. # of interactions / Unit of time = Frequency of contact

• Cost per dollar raised (CPDR). Indicates the success of a fundraising initiative.
• Fundraising ROI. Determines what you earned per dollar spent.

• Cost per dollar raised (CPDR). Expenses / Revenue = CPDR
• Fundraising ROI. Revenue – Expenses = Fundraising ROI