This month's post comes to us from APRA-C member Patrick O'Toole, Associate Director of Advancement Services for Prospect Management at UNC-Asheville.
Data analytics has become an accepted portion of the prospect research profession. Many prospect development operations have conducted a variety of analyses trying to discern answers to the mysteries within our databases. When I speak with colleagues becoming involved with data analytics, I often hear the question, “Where do I begin?” Invariably, my answer is the same: Keep it simple.
When we first undertake data analytics, our heads are filled with great ideas. We want to create an omniscient predictive model that will point the way – exactly – to those individuals who will make a seven-figure major gift in two months’ time. And then we face the reality of making sense of our [often] messy data.
None of us would run a marathon for our first competitive race. It should be the same with data analytics. To help us learn the boundaries and abilities of our data – and to gain confidence in our analytic abilities – I encourage beginning data analysts to design and build a “data digest.”
What on earth is a data digest? you might ask. I gave it that name, because that’s what a former employer called a similar publication. You can call it a data book or a data compendiumundefinedwhatever makes you feel comfortable and confident. Essentially, this book is a collection of descriptive statistics that puts boundaries around your organization’s performance.
Few (if any) of these statistical snapshots should be complex. Instead, you gather in one place, and in a consistent manner, statistics around the number of donors you have each year, the median revenue you receive from each donor, how many new donors you had each year....You get the idea. Your data digest can morph quickly from a mere collection of numbers to a valuable planning tool.
A thoughtfully constructed data digest is great for discerning year-to-year trends. When we close the books at the end of each fiscal year, how much thought is given to comparisons with last year? With the year before? To longer-term trends? By doing nothing more than tracking year-to-year performance, you can enable your organization to better understand broader, troubling trends. For example: Your median revenue per donor has been decreasing, and your total number of donors is decreasing slowly as well, but you’re bringing in more money. This trend may point out that an increasing share of your fundraising is coming from an ever-smaller circle of major donors, demonstrating to your organization’s leadership that you must reach out to new potential major donors.
A data digest can also be used for benchmarking. If you build your data digest to mirror commercially available products, you can gain broader insight to peer performance. Perhaps the best known benchmarking resource is Blackbaud’s “donorCentrics” product. You can find simplified versions of this package online. With a bit of query creativity, you can mimic these products. By doing so, you can start to see how your organization’s fundraising performance stacks up against similar institutions.
Perhaps the greatest value I have found with data digests is providing a reality check during annual planning season. It is very easy for an enthusiastic – and misinformed – manager to say, “We’re going to receive gifts from 10,000 alumni this year!” If you can prove through the data digest that the previous all-time high was 5,000 alumni, and the ten-year average is 3,500 alumni, you can help keep annual goals within the realm of reality and possibility. I am NOT saying these will be easy conversations. I am saying that part of our function is to provide a rational voice in the room. If you have a solid data digest showing years-long performance and trends, it should help you to better influence outcomes.
I update my organization’s data digest annually after the fiscal year closes. Every year, I make improvements and add nuances and expansions. But every year, I maintain the tradition of building the data digest. I cannot tell you the number of times I have referred back to this set of simple, descriptive statistics. My data digest has proven to be invaluable, and I encourage all beginning data analysts to hone their skills by developing and maintaining one.
