This is a guest blog from Bill Tedesco, CEO and Managing Partner for DonorSearch, a company that provides wealth screening, philanthropic reviews, and online prospect research tools exclusively to the nonprofit market.
Prospect research is exactly as it sounds: research that nonprofits gather on their donor prospects.
Once you compile this information, you can analyze it to determine a prospect’s ability to give to your organization (their giving capacity), as well as their affinity to give to your nonprofit.
The more your organization knows about prospects, the better equipped you’ll be to make successful and engaging asks. However, the process of learning about your prospects can sometimes seem anything but simple.
Luckily, we’re here to help. Ever wonder how you can improve your nonprofit’s prospect research tactics?
Start using prospect research like a pro by following these 4 strategies:
- Make the most of your prospect research.
- Build better donor profiles.
- Know the difference: wealth screening v.s. prospect research.
- Reach out to a third-party prospect research service.
Ready to engage your donors more effectively through a solid prospect research strategy? Let’s get started!
3. Know the difference: wealth screening vs. prospect research
On that note, you can improve your prospect research strategy by better understanding how to use wealth screening to your nonprofit’s advantage.
Wealth screening describes the process of analyzing wealth indicator data to paint a complete picture of a prospect’s ability to give.
Before you make your ask, you should know what to expect from your potential donor. Your ideal gift might be out of their price range, or you may be leaving money on the table by requesting too modest of a donation.
While prospect research and wealth screening offer insight into your prospects’ giving capability, the difference between the two lies in what kind of analysis you can come to after you complete your research.
In short, prospect research holistically gathers information on prospects that not just gives you an idea of an individual’s capability to give, but also of their propensity to give to your cause in particular.
On the other hand, wealth screening helps you figure out how capable a prospect is of donating particular gifts.
While they might have different objectives, when paired together, prospect research and wealth screening can help you improve your fundraising strategy. Using the two methods, you can:
Find prospects for major gifts
Using wealth screening data, you can identify prospects who are able to donate at the level you need to reach your goals. Then, with information gathered through prospect research, you can analyze these major giving prospects and decide who is more likely to want to give to your cause.
You might not have a particular gift in mind, but that doesn’t mean you can’t use wealth screening and prospect research productively. Segment your donors using a combination of wealth screening and prospect research to have ready-made lists of prospects for future giving opportunities.
Identify demographic gaps
Wealth screening and prospect research can also give you insight into demographic gaps in your constituency. Are there groups of donors with whom you’d like to engage, but who aren’t represented in your membership? Identify who you’re missing, and then build on that knowledge to strategize future donor acquisition.
4. Reach out to a third-party service
Prospect research is all about filling in gaps in your prospect knowledge. You want to develop the most comprehensive understanding of your prospect pool, and if you’ve been hindered by organizational blindspots, your fundraising strategy could suffer.
Your nonprofit might be limited by time, resources, or manpower. With some outside support, you can supplement your nonprofit’s prospect development strategy with the power of professional prospect research.
If you decide to reach out to a third-party prospect research service, you can choose one of two options:
A fundraising consultant
Fundraising or research consultants can help your organization to build a plan around compiling and using your prospect research. Typically, fundraising consultants work with you to develop a prospect research plan.
There are also consultants specifically trained to help organizations with prospect research. If you choose to hire a prospect research consultant, you may get more direction with both this planning process as well as the actual research itself. These consultants use research software as resources to conduct research on behalf of your organization.
Prospect research software
A form of fundraising software, prospect research software searches through databases to efficiently provide you with prospect research information. Then, the software analyzes this information against consistent metrics to give you a comprehensive understanding of your prospects.
How to choose the best solution
Both of these unique methods can help your nonprofit bring its fundraising strategy to the next level. However, before choosing either, keep a few things in mind:
- What is your budget? There are consultant services and prospect research software options at every price point. With both options, you can choose to engage in continually updated research, or decide to engage in one-time research. While a long-term contract may be a greater financial investment, it may pay off in the long-run.
- What are you planning? Your prospect research can help you in diverse ways, but you need to know the types of things you want to do with it before starting the research process. Will you be planning a capital campaign? Are you trying to increase online donations?
While you’re more likely to get tailored insight through a fundraising consultant, some fundraising software services will work with you to develop a prospect research strategy to fit your goals. Depending on how well you grasp your prospect research needs, you might want more direct guidance.
If you’re interested in hiring a fundraising consultant, check out DonorSearch’s guide to the top fundraising consulting firms in the market. If not, you may choose to invest in prospect research software.
If your nonprofit wants to make better asks, you need to strategize your prospect research process. With these tips in mind, you’re now ready to use prospect research like a pro!
About to get started on an online fundraising campaign? Solve the online fundraising puzzle with our helpful guide.