By Jennifer Filla
Have you ever wondered from what seed sprouts an organization’s desire to hire its first research employee? And once in that role as the first prospect research staff member, what could that researcher focus on that would have the most impact?
I propose that for many nonprofit organizations, the seed is prospect identification. Because if I’m under pressure to raise more funds, it must be because we are missing out on great prospects and an expert could fix that for us.
And if I’m a new vice president hired for the purpose of getting the team to be more productive, I might have had a researcher on staff at a previous position, so I know research works magic, but I probably don’t know exactly how research is performed.
And yet, the first research hire sometimes struggles. Maybe they come with loads of experience and go in too deep too fast, making staff feel like there is too much complexity for no good reason and generating resistance.
Or maybe they are new to the field and, although eager to find new prospects, get bogged down in researching the names newly identified through the prospect screening — spending upwards of an hour on each name.
Some organizations experience churn in the new position because of roadblocks such as these.
How can the first prospect research professional at an organization like this jump in and succeed?
Let’s look at five guideposts that a researcher of any experience level can use to confidently create a new prospect research program.
- Keep it Simple: The prospect identification process in a development team new to research looms large by itself. Introducing a more formal, complex prospect management process can be overwhelming. Avoid doing too much.
- Segmentation: After the screening is segmentation, and it is about more than gift capacity. Adding segmentation provides a firm foundation for the entire team.
- Best Prospect: This is often completely undefined and team members are operating with different definitions. Helping to define this brings everyone together.
- Complexity: Once everyone agrees on definitions and desired outcomes, the flow of prospect management for a small team no longer looks or feels so big and confusing.
- Too Rigid or Too Flexible: Humans and even data are never perfect. If the system is too rigid or too flexible, the team is likely to struggle.
1. Keep it Simple: Don’t Talk About Prospect Management!
Have you watched the Disney movie, Encanto? My granddaughter loves the song “We Don’t Talk About Bruno.” Why don’t they talk about Bruno? Because he prophesies things like rain on your wedding day or your fish dying.
In this same theme, we do not talk about prospect management. Well, not when everyone in your office is worried about prospect identification.
If prospect identification is the key problem that prompted a research hire, stay focused on that problem instead of launching into a full and formal prospect management program. This builds your credibility and can help make the team receptive to a more formal program later. Introducing too many new terms and ideas early on confuses and overwhelms fundraisers under pressure.
Keeping it simple also applies to researching newly identified prospects. This is especially true if you are the first person to support a team of major gift officers — your time is precious! Seek out a mentor from your local Apra chapter, network online or get training. Learn best practices for finding the right amount of information in the right amount of time.
2. Segmentation: Align Segmentation With the Current Portfolio Assignment Strategy
Although it is a nuanced concept for your new development team, segmentation is a term well worth introducing immediately. When you introduce a new word, such as segmentation, contextualize it to what already exists.
So, if Major Gift Officers (MGOs) are segmented by gift sizes, then create your segments by gift size.
Example of Segments
When you align the segments with current assignments and the MGO and vice president come to realize that typical endowment gifts range from $50,000 to $100,000, and gifts of $250,000 or more usually take more cultivation staff coordination before getting to the gift proposal stage, there is much less resistance to changing the makeup of the segments.
You might then suggest new segment definitions that incorporate the ranges of giving the organization actually experiences, as well as the donor motivations or characteristics that go with the types of giving.
But why is segmentation so important and what exactly is it?
Segmentation is the research magic that happens between the vendor screening, scoring or whatever data analytics you pursue to verify that a specific donor really is a good prospect.
Segmentation allows the researcher to help the organization define who is a best prospect — beyond the scores and capacity ratings.
3. Best Prospect: Ask the Expert MGOs
Defining a best prospect for each segment is what segmentation is all about! A best prospect in the segment 1 example above may be a donor who has this formula:
(High capacity rating OR Lifetime giving of $250,000+) AND (Giving to national and local nonprofits for conservation OR Receives and opens conservation alerts emails)
But don’t try to define a best prospect on your own and then have to persuade your team you are correct. Instead, interview your MGOs; they actually talk to donors. “Tell me about your best prospects” is wide open and focuses on just how good they are at their jobs. You will also gain a far better understanding of what data is available to identify prospects who are more likely to respond to a qualification call.
A great time to do these interviews is when you are new to your research position, but you can do it at any time. Most MGOs are delighted to share their insights and opinions, and you can begin to untangle how differing definitions of a best prospect are impacting the fundraising results.
When you begin to create the data formulas behind your segments, you can share this with the team and give credit to their expert input. When everyone agrees on what makes a best prospect, conversations around qualification calls and prospect assignments have the potential to run better.
Now your verification research can be quick and targeted, because when a best prospect is well defined you know which key items are the primary pieces of information you need to search for. No more need for deep research on newly identified prospects slowing you down.
4. Complexity: The Start-Up Prospect Management Flow Chart
I’ve talked about segmentation and best prospects, but I haven’t really given you the full prospect identification process. The chart below is a simple depiction of the process.
Prospect Identification Process
If there is a team of MGOs raising millions, then they probably know all about moves management. They know that they must start cultivating and building a relationship, and when the prospect is moved, when the time is right, solicit a gift. Usually, a system is in place to track these moves in the database.
However, segmentation and defining a best prospect in each segment might be a completely new perspective on major gift fundraising for a team that has never had a researcher. By creating these methods at the beginning of the process, leadership and the MGOs often recognize the next steps they need to take, such as rebalancing their portfolios based on these clarified definitions of a best prospect.
Once the prospect identification process is flowing, the leaks and kinks are easier to spot and diagnose by the team. What is a complex system appears or feels simpler because everyone has agreed on the definitions and steps.
5. Too Rigid or Too Flexible: Faster, Better or Cheaper — Pick Two!
There is another benefit of introducing the idea of segmentation: it allows you to recognize and solve for when there is too much rigidity or too much flexibility in the process, including your own behavior.
For example, if you, the researcher, are flummoxed by messy data and want the team to wait six months for new prospects while fixing it to fit a formula, there is a rigidity issue. In the beginning, faster and cheaper is probably going to have a higher return because it allows for some early wins, which builds momentum.
On the other hand, if the vice president is unwilling to define some specific outcomes for qualification calls, they will happen fast and cheaply, but the number of dollars raised might not increase enough. Too much flexibility in defining a best prospect at the qualification stage undermines the effort.
Dealing with the Overwhelm: There’s Only So Many Hours in a Day
If you relish the idea of building a research program from scratch, you might also be the kind of person who likes roller coasters and other adrenaline-filled adventures! But no matter how exciting the prospect of jumping into a new research role at an organization, it helps to keep in mind that everyone will feel overwhelmed and frustrated at some point.
You might find that the efforts to solve the prospect identification problem before you were hired resulted in a morass of data dissonance. By the time you arrive at the office, fundraising leadership might be feeling a bit desperate to meet goals and struggle to be patient as you try to understand your new environment and introduce something new, such as segmentation.
If the tipping point to hiring a research professional was the prospect identification problem, then there’s no shame in grabbing a likely list of donor prospects from somewhere and beginning delivering quickly — with disclaimers, of course!
Our field of development and prospect research is thriving and fast-growing. Development leadership has woken up to the power of data. Opportunities to make a big impact and accelerate your career abound. Just don’t talk about prospect management!