How AI Fundraising Can Help Predict Donor Behavior

September 14, 2023

Traditionally, nonprofit fundraising and marketing strategies have been based on assessing data after a campaign or initiative concludes. Nonprofit professionals review metrics and key performance indicators to understand what went well, where there is room for improvement, and how they could adjust their strategies to improve future efforts

AI fundraising tools have revolutionized the data collection and analysis process for nonprofits. Instead of just assessing data from past campaigns, nonprofits can use machine learning tools to anticipate future donor behaviors, taking their fundraising potential to new heights. 

Your nonprofit might be ready to dive deeper into the AI fundraising realm, but first, it’s critical to understand what these solutions can do to help predict donor behavior. This mini-guide will cover the basics of AI fundraising and what your nonprofit needs to know about how these tools can predict donor behavior.

Types of AI Fundraising Tools to Know

When it comes to analyzing donor behavior, there are two types of AI solutions to know about:

  • Descriptive analytics involves assessing historical data to understand the results of a past fundraising effort. These analytics can take the form of reports, dashboards, charts, and surveys. 
  • Predictive modeling (also known as predictive analytics) is the process of developing models that predict donors’ future actions. IBM Watson is an example of a predictive modeling tool—this solution leverages an organization’s internal data to create a personalized model of future donor behaviors. 

Predictive modeling solutions are the tools that will help you gain a deeper understanding of your donor base and proactively market to their needs. 

In the following sections, we’ll focus on exploring the predictive power of AI modeling tools to help anticipate and respond to future donor behaviors. 

Ways AI Fundraising Tools Can Predict Donor Behaviors

Predictive modeling solutions can support multiple aspects of your donor management strategy, from prospecting to major donor cultivation and donor reactivation. 

Predictive modeling tools can help you identify donors who are most likely to:

  • Start giving when they haven’t yet
  • Start giving again after a lapse
  • Give again after also donating last year
  • Start giving in larger quantities
  • Become a major or principal donor
  • Become a legacy or planned donor

Predictive models score and rank donors based on factors like engagement, giving capacity, donation frequency, and campaign interests. This can help you prioritize your donor outreach, making your operations more efficient. 

How to Use Donor Behavior Insights in Fundraising

Having accurate, customized predictive models in your toolkit is a huge advantage when it comes to planning future campaigns. You can determine how your nonprofit’s unique audience will respond to your campaign message, donation requests, and other outreach activities. 

BWF’s predictive analytics guide highlights a few ways your nonprofit can leverage AI insights to improve your marketing and fundraising results, including: 

  • Generate more appropriate donation requests. You can use prospect modeling to understand each donor’s giving capacity. This will allow you to identify and request suitable, personalized donation amounts that prospects will be more receptive to. 
  • Develop donor personas. Donor personas are fictionalized representations of different segments of your donor base. Predictive modeling can assess characteristics donors have in common, such as engagement patterns, demographics, and giving preferences, to group donors more accurately. You can also identify your most engaged donors and understand what traits they share. 
  • Determine the right marketing channels to use to reach your audience. AI tools can pinpoint the most popular marketing platforms across your donor audience, whether social media, email, direct mail, SMS messaging, etc. Then, they can determine which marketing channels each segment prefers. AI solutions can also apply these insights to new prospects to understand which channels they’re most likely to use. 
  • Craft compelling marketing messages. Predictive models can assess your most effective marketing messages and determine the qualities of a powerful message. This allows you to create personalized messages for each donor segment, ensuring that supporters receive messages that speak to their motivations.
  • Choose an effective communication frequency for your target audience. AI models can assess donors’ responsiveness to past marketing campaigns based on how many touchpoints your organization had with audience members. You can anticipate when donors may start to feel communication fatigue and avoid overwhelming them with messages in the future. 
  • Assess major campaign readiness. Predictive modeling tools can help determine if your nonprofit is ready to take on a significant initiative, like a capital campaign. Predictive analytics come in handy during the pre-campaign planning phase, which Capital Campaign Pro defines as the time to “determine [campaign] objectives and settle on the preliminary dollar goal needed to reach those objectives.” Using predictive models, you can judge how much your nonprofit will likely be able to raise by considering your donors’ capacities, their willingness to give, and your past fundraising successes. 
  • Predict the impact of external circumstances. Changes in the economy can impact your donors’ giving capacity. When a downturn or upswing occurs, you can use predictive modeling to compare economic data like unemployment rates or inflation to your nonprofit’s past fundraising data. This can help you anticipate the impact of current circumstances on your upcoming campaigns. 

When running predictive analysis, your nonprofit’s internal donor database must be clean, organized, and updated. Having updated data will make your predictive models more reliable and accurate, helping you increase the ROI of your AI fundraising efforts. 

If you’re looking for support to clean up your organization’s database or switch to a new system, consider working with a CRM consultant. A CRM consultant can audit your existing database to assess whether you’re using your current CRM solution as efficiently as possible. They can also help manage any CRM upgrades if you’re looking to transition to a more robust system to facilitate better predictive analysis.

Effective fundraising campaigns anticipate donors’ needs. AI fundraising can help your nonprofit streamline many of the donor research activities you do already, making the process much simpler. 

By automating processes, you can gain deeper insights into your donor base and put those insights into action much faster. Plus, donors will feel more connected to your nonprofit when you reach out to them with personalized messages that speak to their unique interests, motivations, and preferences.

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