High quality prospect research—learning everything you can about your major gift prospects—pays for itself many times over. It is a key best practice used by successful major gift programs.
Prospect research is important to:
- Learn more about the donor, especially financial resources, inclination to give and connections to your organization you may not have known about
- Get the “ask” into the right ballpark.
- Use your time profitably.
- Reassure the person doing the asking–don’t under-estimate the importance of boosting the confidence of your “asker”!
How do you learn more about your major gift prospects?
- By talking to them: A visit to a prospect’s home or office is the picture worth 1,000 words. This is an information-gathering visit, not an “asking” visit. You are getting to know the prospect better and vice versa. You’re asking lots of questions. You’re writing-up meeting notes. You’re assessing whether or not the prospect is ready to be asked the next time around.
- By researching publicly available information and assembling a donor profile. The idea is to assemble a comprehensive picture of your prospects: where they live; family; business ties and dealings; who they know; where they belong (memberships; board service; volunteering); where they give (in addition to you); how much they give (to you and others); asset value, e.g., real estate, stock holdings; income; and any other relevant information. Put it all together and you have a sense of financial position, inclination to give and connection to your nonprofit.
How does a small organization develop donor profiles?
- Purchase them from an independnt prospect research company or freelance prospect researcher.
- Do your own research with a subscription to an online prospect research tool such as WealthEngine through which you can run an unlimited number of prospects. Please note that online subscription services are tools, not researchers. The data must be cross-checked, analyzed and developed into a meaningful donor profile. Trained staff is a necessity.
- Do your own research for free. Between Google and the assessors office, it is possible to learn something about your donors real estate holdings and much else as well.
Prospect Research by Numbers: Return on Investment (ROI)
Assume you use a a professional prospect researcher. At $200 per profile, for example, research on 20 prospects will cost you $4,000. From the 20, let’s say you set up 10 asks and 2 say “yes” to $25,000 and 4 say “yes” to $10,000. That’s $90,000 in gifts for which you paid $4,000 in research.
That’s a $22.50 for every $1 you spent on prospect research–or an ROI of 2250%!
How to fund your prospect research:
If you are screaming: “Hey, I’m small—how on earth am I supposed to do research? I don’t have the money. I don’t have the time.”
- Maybe a board member or donor will underwrite the research once he or she understands the whopping ROI.
- Perhaps you can recruit a “Google-oriented” volunteer (remember to emphasize confidentiality if this is your solution).
- Or, maybe you can squeak funds out of your collateral budget. “Glitzy brochure” is not on the list of requirements for successful major gift asks.
Prospect research resources include:
- Association of Prospect Researchers for Advancement (APRA) www.aprahome.org
- Charity Channel Prospect Research Listserv: Prspct-L at www.charitychannel.com
Prospect research sitting on the shelf is expensive. Prospect research used to make “asks” is a goldmine.