How to Harness Big Data

We’re talking with Stelter’s Director of Business Development Michael Hutney. In his nearly 10 years with Stelter, Michael has led product strategy, innovation, emerging media and strategic accounts, while building and supporting strong client relationships nationally.

For years now, Big Data has been driving big business. Among a host of other uses, Big Data determines what types of products or services companies will pitch to you, and in what format they’ll pitch them.

While nonprofits may not have the same bandwidth for Big Data, they certainly do have the capacity to wield data in powerful ways. When used from the lens of strengthening mission or relationships, data can produce detailed, real-time information and themes to better and more quickly inform what you do and why.

Today, let’s get Michael’s thoughts on how nonprofits can not only manage data but also harness its potential, so it doesn’t end up sitting in isolated silos but instead, serves as the backbone of your nonprofit’s most powerful story yet.

NS: It can be easy to get overwhelmed by all the data that can become available to us. Any strategies nonprofits can use to stay in control of their data and use it to effectively help chart their next course?

MH: There are two things to talk about here: simplicity and discipline. There is so much information out there, and all of it seems very useful at first glance. But the failure of many data projects is to go too deep, too fast.

Consumer data changes every day. And for-profits, like financial services, the airline industry and consumer goods for example, can churn out data in real-time; meaning they can identify new prospects, surface campaigns, include/exclude in campaigns and more, all in an automated, seamless flow. They also have in-house data science teams that are equipped to manage and have the tools and resources to act in a more timely and effective way.

Most nonprofits do not have this luxury. So for us in this world, analysis is done at a point in time (versus ongoing). Our “point-in-time” strategies require discipline in that we need to be mindful about refreshing the information consistently.

As a result: Simplicity rules the day.

If you’re starting out with your data gathering, or starting over for that matter, start by “shoring up” information on existing records. Do you have basic demographic information on your donors, volunteers and other invested parties, like board members? By this I mean age, gender, marital status, ethnicity, income, education and occupation.

Having this information is a fantastic first step. The marketing possibilities really open up if your database has all or most of this information for donors on file. Then you can start to target by gender, projected wealth, age, and education and ultimately get closer to the donor.

As an example, we completed a direct-mail survey for the Animal Rescue League of Iowa about a year ago that helped ARL prioritize its efforts around potential donor solicitation. ARL’s planned giving department, like many others, often finds itself short on time and resources.

So the survey had a two-fold purpose: 1) establish a pipeline of planned giving prospects and 2) prioritize that pipeline to maximize the department’s time spent on building those donor relationships. Not only did the survey’s 20 percent response rate reveal that 70 people already had a planned gift to ARL in place, but it also indentified 70 people that were “likely or very likely” to make a planned gift and 60 said they were open to the idea of making a gift. The data from the survey enabled ARL to know its prospects better and ultimately get closer to them and speak to them in a more meaningful way.

NS: Share with our readers more about the discipline aspect of data.

MH: Part of “shoring up”, as I mentioned earlier, is about process. You have to become a data-driven organization—and stay committed to it.

Too many nonprofits perform a one-time spend on acquiring demographic information but then do not commit to keeping that information current.

Bottom line: Know your limits. Know what you, as an organization, can realistically commit to and deliver on. Use a crawl, walk, run approach. Managing data gets easier if it becomes part of daily life.

NS: What trends are you seeing in Big Data moving into the nonprofit-sphere?

MH: Most of the innovation is happening on the for-profit side; however, there are exciting new uses coming from the social media world. Using data to find smaller segments of engaged donors to micro-target messaging for testing purposes, for example. This enables nonprofits to find the messaging that works, in a low-cost environment (digital, social), before deploying a more costly campaign, such as direct mail. Finding those smaller segments through data, and testing through them, can empower nonprofits to create a stronger story and more confidently stand behind its messaging.

NS: For smaller nonprofits, or those working to build their data systems, what first steps should they take?

MH: First, commit to a database. (Raiser’s Edge, Blackbaud CRM, or Salesforce for Nonprofits are good starting points.) Second, resist the urge to customize that database; customization makes database upgrades and maintenance more difficult. (Simplicity, remember?) Third, obtain demographic information. Fourth, commit to data “refreshes” on a consistent, annual basis. (Discipline, remember?)

NS: Any last words of wisdom?

MH: The nonprofit that masters how to leverage data will outperform its peers. Consumers expect personalization; one-size-fits-all marketing does not work. Know your donor. Know what matters to them. Know where they are coming from.

Data is a critical success factor in making your campaigns both personal and timely, and allows you to send the right message, using the right channel, at the right time.

See how our friends at Feeding America tapped into their data through our PG Finder program to develop more streamlined—and successful—messaging to potential donors. Any other stories of success? Let us know. We’ll be happy to share your story.

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