Building a System of Data-Driven Development in 2020
At Windfall, we are passionate about data. We now work with over 500+ nonprofit organizations, helping them better leverage data and analytics to accelerate their fundraising efforts. Given our experiences with forward-thinking customers, we predicted that development professionals would double down on data and machine learning in 2020.
Last week, Apra hosted Advance Tomorrow: The Prospect Development Virtual Experience. Generally, this conference would bring together thousands of prospect researchers and development professionals for a great multi-day in-person experience. The shift to an online event captures the challenges facing the industry: historical methods need to evolve in our current environment.
We wanted to capture this at Apra’s conference and were lucky enough to host a session on building a system of data-driven development. We were also fortunate enough to co-present with Mohammed Dasser from NYU, who also participated in one of our customer roundtables in May. Check out the full Apra recorded session on our website.
In this session, we put together a framework for development professionals:
- Establish a foundation of trustworthy data
- Develop meaningful insights into your constituents
- Generate deeper intelligence from your data
- Take action on your data across the organization
- Analyze and measure results and iterate
Why Do Organizations Need to Become More Data-Driven Today?
In today’s economy, we can see an extremely volatile and, at times, confusing market. At first in March, major stock market indices shed ~30% of their value, and we wrote about how this impacted consumer wealth. Since then, through one of the most trying times in US history, the stock market has come roaring back (as of September 3, 2020). But does that mean everything is back to normal?
The stock market is only one component of wealth. Other events certainly signal impacts to consumer wealth: widespread fires in Western US, hurricanes in the South East, mortgage default payments on the rise, small businesses shutting down permanently, unemployment reaching all-time highs, etc.
Analyzing the past gives us some clues for what a potential recovery could look like. Unfortunately, even with a speedy recovery, the trends show that the following year has historically proven to be challenging for individual fundraising:
As we’ve heard from our customers, this recovery comes with additional challenges:
- Budgets are tightened or highly scrutinized — they need to do more with limited resources
- Historical fundraising events and in-person meetings are off the table for the near-term
- Virtual events and video conferences were a good start, but are losing steam with constituent fatigue
Overall, there is a lot of noise out there — so how do you know where to focus your time, energy, and efforts to meet lofty goals?
Building a System of Data-Driven Development
One of the main challenges that we’ve seen our customers face at Windfall is that all of the development professionals thirst for timely, accurate, and actionable data. The problems in organizations may differ, but we have found four key data issues:
- Limited data / missing pieces
- Stale & inaccurate insights
- Complexity of generating intelligence
- Taking action and measuring implementation
After speaking to hundreds of customers and professionals, we tried to simplify a framework that can help isolate where organizations may fall short:
As you can see, this framework and the challenges that organizations face compliment each other. While we discuss the specifics in our webinar, some of the key takeaways include:
- Unify your data: Leveraging products like Windfall’s Data Link can create a “golden record” of constituents to establish a foundation of trustworthy data
- Don’t limit your insights: Wealth Screening a subset of your constituents is a relic of the past. In these trying times, hidden pockets may mean the difference of missing or hitting your goal
- Generate intelligence through machine learning: By leaning into machine learning and understanding an individual’s Propensity to Give, organizations can spend time on the right constituent
- Measure and iterate: Data is not a one-time exercise. Organizations need to commit to this framework and measure results more frequently than once a year (even with a long-term strategy)
Learnings from the Field: Accelerating Advanced Analytics at NYU
At Windfall, we have had the pleasure of working with the team at NYU, including Mohammed Dasser, Associate Vice President of Strategic Planning & Analysis. Mohammed has 15+ years of working with data, business intelligence, and analytics. Of course, one of the lessons Mohammed has learned through his experience is:
“The perfect is the enemy of the good.” — Voltaire
As with any data analytics program, nothing will ever be perfect when organizations commit to a data-driven path. That being said, it does take the commitment of the entire team and not just one individual resource. On this path, the learning curve that NYU (and most organizations) face includes 3 steps: (1) Reactive (2) Proactive and (3) Predictive.
Another way of looking at this on the spectrum of analytics includes the moving from descriptive analytics to prescriptive analytics:
NYU has embraced Windfall’s Propensity to Give product for two initiatives: Major Gifts and Planned Giving. This enables the team to maximize bandwidth and become more intelligent about its fundraising efforts.
One extremely interesting and novel way to make the model scores actionable is to create a 2x2 matrix to help understand / visualize a Major Gift Officer’s portfolio. At NYU, they do an extremely good job of capturing affinity to the organization but wanted to augment their understanding with Windfall’s scores.
The scores quickly showcase where there is potential and how MGOs can spend their time more efficiently to hit their goals. This is just one method to take action on the data, measure it, and iterate as things progress.
It was extremely compelling to hear how NYU values its data feedback loop, where scores are refreshed on a regular basis (weekly, monthly, etc.). Building confidence and trust in this system takes time, but once you iterate and measure the process and results, teams coalesce into a well-informed machine.
Conclusion
As we have seen from recessions in the past, nonprofits and development professionals will face a tough road ahead. COVID-19 has added an extra layer of complexity, since traditional fundraising methods (events, meetings, reunions, etc.) are no longer options in a nonprofit’s arsenal. In order to combat this environment, nonprofit professionals will need to double down on the data-driven methodologies and commit to them across the organization.
Windfall has collected stories from hundreds of nonprofits across the country and suggest to use the following data-driven framework:
- Establish a foundation of trustworthy data
- Develop meaningful insights into your constituents
- Generate deeper intelligence from your data
- Take action on your data across the organization
- Analyze and measure results and iterate
To find out more about our services and how we may be able to help your organization, feel free to reach out to our team.
This article was authored by Arup Banerjee, CEO and Co-founder of Windfall based on his presentation with Mohammed Dasser, Associate Vice President, Strategic Planning & Analysis at New York University.
About Windfall:
Windfall helps you identify, understand, and engage the affluent. We provide you with precise net worth data on affluent US households, allowing you to make informed data-driven decisions.
For more information about Windfall please visit our website: http://www.windfalldata.com.
