Prospect research is a fruit salad. It’s not just pineapple or watermelon or honeydew, but all varieties of research techniques that help fundraisers, development teams, and nonprofits to find major gift prospects.The fruits of prospect research’s labors include background on donors such as:
- Previous Donations – Past gifts to your organization and similar nonprofits are the top indicators of high quality fundraising prospects.
- Nonprofit Involvement – Nonprofit board members, foundation trustees, and directors all understand the importance of philanthropy and are more likely to give.
- Political Giving – Donors of $2,500 or more in political gifts are 14 times more likely than the average person to make a philanthropic donation. Political giving is an indicator of philanthropy and should not be confused for a wealth marker.
- Business Affiliations – Discover new prospects through people your donors are connected to as well as eligibility for matching gift grants.
- Wealth Markers – Real estate ownership, stock holdings, and boat ownership are examples of wealth indicators that reveal a prospect’s capacity to give.
- Personal Information – Don’t forget to check up on mailing addresses, phone numbers, spousal information, and other information in order to contact the major gift prospects you find.
This data helps to determine whether or not a prospect has the capacity and affinity to make a charitable donation. While wealth matters, a history of philanthropy matters more, because the goal is to find philanthropically inclined prospects first and capacity to give second.While prospect research does help find prospects who can give large gifts, typically of $5,000 or more, it does much more than merely provide names on a list:
- Identification – Some gifts can take a long time to cultivate, and you may not receive them until a donor passes away. Learn who is apt to be a planned or deferred donor in order to leverage significant donations from those who tend to give minor amounts.
- Generation – A great place to find new donors is on the donor lists of similar organizations. You can also look to nonprofit foundations and boards for wealthy people inclined to give charitably. While your list of annual fund donors is the best place to look for major gift prospects, and the best place to start, prospect research opens up the opportunity to find entirely new donors, too.
- Conversion – Past giving is the top indicator of future giving, so be sure to research your annual donors to discover who has the capacity to give more.
- Refinement – Time matters, and prospect research allows you to pinpoint major gift prospects so that you can allocate your resources accordingly and move on to other phases of fundraising.
- Optimization – For organizations that have constant influxes of donors, it’s important to routinely screen prospects in order for staff to focus fundraising efforts on the right people. It’s also important to analyze giving patterns and update missing information in your nonprofit’s database in order to create a more efficient fundraising effort with more specific ask strategies.
There is no right or wrong way to conduct prospect research, but you don’t want to show up for the fishing trip with an insufficient rod. A feasibility study can help you to determine which of the three most common prospect research methods is right for your nonprofit:
- Prospect Screening Company – Save time by employing a screening company to research large batches of donors against a plethora of databases. You’ll receive philanthropic indicators, wealth markers, and individual and group prospect overviews. This allows your staff to spend more time on other fundraising efforts.
- Prospect Research Consultant – A good consultant will dig deeper than a screening to discover the specific information you need to deliver better pitches to your high quality prospects. Some consultants will also train your staff on prospect research, develop cultivation strategies, and help to manage your relationships with high-profile prospects.
- Do It Yourself – You can do it! Or the prospect researcher on your staff can. By providing your researcher or team of researchers with the proper tools to find and organize donor information, you can conduct prospect research in-house, and to the detailed degree of your choosing. If you’re a smaller nonprofit that can’t afford a staff researcher then consider the ways to conduct makeshift prospect research on a budget.
Prospect research is best used in tandem with other habits that lead to effective business outcomes, as it is one thing to obtain more prospect information and another to have the systems in place to maximize that data’s potential and turn it into more major gifts for your organization.