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Not all data is of equal value and not every donor is either. Part of the framework that leads from insight to action is understanding which donors are of more value and those that will lead to greater levels of renewal.

Donor Value Framework

Basic value segmentation looks at low actual value and low potential value. The focus is to mine the data and watch for changes from other data.

A second cohort to segment is high current value but low potential value. The focus is to maintain the relationship to renew commitments.

Third, segment those who are low actual value and high potential value. The focus is cultivate the relationship and upgrade the commitment.

The final segment are the donors with high actual and high potential value. The focus here is to invest in the relationship.

It is critical to recognize that not all donors have the same value long term and to invest in the ones that have a high potential. This type of segmentation requires high levels of insight. Standard business processes can be enabled in lots of systems via workflow.

The digital executive has a specific responsibility to insist that this is core to your marketing, donation and digital strategies. An unfocused approach to engaging with donors can be disastrous. If you are a marketing or donation executive, organize a group to help formulate the strategy and become ambassadors for its execution.

One requirement could be to enhance your data with external sources to assist in process of segmenting. Tools like Dunn and Bradstreet data for corporations and wealth screening for individuals may be useful. In some cases it may be as simple as enhancing data based on zip codes and census tracts to get started.

Here are the key ideas:

  1. Start now to create a framework to segment your donors.
  2. Begin to formulate a strategy of how gain enough insights to move donors through the framework.
  3. Encourage investments in building relationships with high potential value donors.
  4. Consider enhancing your data to assist in this type of segmentation.
  5. This may not be easy, insist on finding a way to make it happen.

Don’t let a lack of resources hold you back.

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