Wednesday, October 22, 2008

Making Data-Driven Fundraising Decisions

"Super Crunchers" Book Review

Are you a Development Professional looking to increase how much money your annual fund raises?

If so, then Ian Ayres’s Super Crunchers should be on your bookshelf.

Written in accessible and lively language for audiences unfamiliar with complex quantitative analysis, this Yale Law School Professor shares the value that basic statistical tools bring to decision-making.

Ayres uses real-life case studies – ranging from medicine and air travel pricing to film and wine – to demonstrate that fairly accurate predictions about future behavior can be made using only historical data and simple statistical measures.

The truly radical part of Ayres’s thesis is his assertion that predictions based on statistics are even more accurate than those intuitive predictions of well-known experts in a specific field.

Ayres is chanting a fundraising mantra: data-mining is valuable.

Now, with large amounts of data available – such as donor databases – statistical literacy is rapidly becoming an essential skill for Development Professionals.

Correctly pinpointing factors that motivates donor behavior is key to successful fundraising. We all do this when it comes to major donors, right?

1. We know that Charlie and Kirsten Holbrook’s giving increases when the organization’s Board Chair asks for the gift in June.

2. We also know that Anu & Sid Singh give $2,500 every time you ask them, but they won’t give a single gift of $10,000 – even though every year for the last 3 years, they've given $15,000 annually.

How do we know all these things?

As Development Professionals, we’ve invested time to learn the giving habits of our major donors.

And, we have access to a wide variety of data points to make our decisions about how and when to solicit these donors.

Wouldn’t it be great to be able to make the same investment with your direct mail program?

1. What if you could figure out exactly who should receive monthly solicitations and who should only be solicited every March?

2. What if you find out mid-year that the state is cutting your reimbursements or that unexpected storms washed out the only bridge connecting your summer camp program to a paved road?

In fact, identifying the correct underlying relationships between donors and their giving habits can be done easily using a few statistical tools.

Arrowhead Management uncovers the ‘hidden’ relationships between your donors and their motivations to give to your organization.

We use these relationships to help you maximize revenue from your annual fund.

And, we don’t stop just at telling you which donors you should solicit for an emergency appeal – we stick around to help you craft your message, write the appeal copy and put together the list of donors.

Arrowhead Management can empower you and your cause to make data-driven decision and raise more funds.