Effective data use is key to nonprofit direct mail success, yet some fundraisers question the need for a more sophisticated data approach, of course. So we'll pass along a recent NonProfitPRO blog post by Chris Pritcher, of Merkle's Quantitative Marketing Group, which challenges overly narrow views of donor data. Too often, using data to understand the donor base is limited to one of two categories, Pritcher notes: 1) RFM (recency, frequency, monetary) data and giving history, or 2) donor demographics and behavioral measures, ranging from factors such as wealth or related interests/purchases to applying behavior-lifestyle systems such as Prizm. Whether the data is first-party or third-party sourced, each approach has its limitations. RFM often silos data from a single channel, for example, even though donors live in a multi-channel world. RFM also focuses mainly on short-term financial action, ignoring donors, especially Millennials, whose giving is maximized through an interactive, long-term relationship. Meanwhile, though donor demographics can help avoid low-opportunity lists and segments, demographics in isolation may be too general for effective response targeting. Wealth data indicates who has money but not who is willing to give that money to a specific cause, as Pritcher points out. Pritcher urges fundraisers to embrace "multi-dimensional segmentation" over the either/or data approach above. Nonprofits can analyze donor actions (both financial and non-financial) along with data such as demographics, wealth, donations to other organizations, etc., to create more actionable segments. For some basic tips for multidimensional segmentation success, see our complete post at http://www.acculistusa.com/fundraising-mail-benefits-from-data-rich-list-segmentation/
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