Trends in Donor Management

(This article originally appeared in the Nonprofit Times.) As user demand increases, vendors are adapting their donor management system offerings to support mobile devices and cloud computing, one of several recent market trends that are adding value and capability to the software. They’re also enhancing functionality that’s critical for nonprofits, like integrated email and ease of use, in many cases adding substantial functionality without raising prices. 

This is good news for organizations looking to buy or replace a donor management system. There’s less reason than ever before to consider building your own system when you can buy a relatively feature-rich one prepackaged for less than $500 dollars. It may even be possible to save money by moving from a more-traditional, expensive system to a cheaper one better-tailored to your particular needs.    
What are the fastest-moving trends in the donor management world? Here are a few to keep an eye on:
  1. Mobile Computing. As mobile devices become both more popular and more powerful, vendors are optimizing their donor management systems to support access from tablet computer and smartphone web browsers. A few offer specialized applications, or “apps,” that facilitate use from mobile devices, allowing fundraisers or directors to gather information about prospects or even enter notes or gifts from the road. Many of the vendors who have not yet addressed this trend have stated their intention to do so in the near future.
  2. Hosted/Remote Access. Vendors are also designing systems to accommodate web accessibility, often called cloud computing, Software as a Service (SaaS) or Application Service Provision (ASP). Users can work from virtually any computer, and because it’s hosted rather than installed, vendors handle setup and maintenance, reducing strain on IT staff. Most of the leading systems now offer hosted solutions—even some that have traditionally been available only as installed packages.
  3. Email. The presence of any email functionality at all in a donor management system was noteworthy in 2009, but this year’s crop of systems shows a significant shift toward strong email support. The more-advanced broadcast email capabilities allow fundraisers to easily send formatted emails personalized to each donor, and to track who opens and clicks-through on each. Some vendors have built their own functionality into their systems, but the general trend is to integrate with existing services like Constant Contact and VerticalResponse.
  4. CRM Convergence. There used to be a clear distinction between specialist donor management systems and Constituent Relationship Management systems (CRMs), which allow organizations to track many different kinds of constituents in addition to donors. That line has blurred noticeably as these types of systems converge. More and more donor management systems include stronger features for managing other types of constituents, and general-purpose CRMs are starting to include specialized donor management functionality. The result is a greater selection of software that can be used across whole organizations rather than only for specific departments.
  5. Access to External Data. Vendors are enabling systems with the ability to easily integrate additional data about donors—for instance, to pull in wealth-screening information that lets users see who’s likely to be major donor prospects. Many vendors are also exploring the possibility of pulling social media information into their systems as well. Though most have not gotten very far down this path yet, there’s a clear shift in this direction.
  6. User Experience. Form usually follows function with software, but as Information Technology becomes more mainstream, vendors are recognizing the value of a positive user-experience. In addition to power, donor management systems are beginning to offer more flexible, aesthetically pleasing user interfaces. Most now let users rearrange screen elements, rename data fields or hide those they use infrequently, create “dashboards” of the tasks and information most valuable to them, and customize software workflows to better match how work is done in their organizations. Many systems even let individual users customize their own settings.
  7. Reporting. Finally, reporting capability has become much stronger field-wide over the past two years. The ability to include charts and graphs in reports is quickly becoming the standard rather than a bonus, as is support for adding favorite reports to dashboards to provide quick, critical information on a per role—and sometimes per user—basis.
These are the trends, but what’s shaping them? Most likely, changes in user expectations. As technology becomes more advanced, it’s also becoming more mainstream. Staff no longer consider an Excel spreadsheet a sufficient development database. Organizations are more likely to recognize the benefit of investing in software that helps staff do their jobs, and vendors are competing for an expanded market by improving their offerings.
As the systems get better, organizations are more likely to upgrade their existing systems to benefit from new features. A nonprofit whose development staff works remotely might be enticed by a new system with increased support for smartphones, or one that lets staff work as effectively from their home office or hotel business center as from an office.
The changing demographics of senior nonprofit management may also be changing expectations. Executive directors of the past might have asked development staff to print donor reports, but today’s computer-savvy managers might prefer customizable dashboard views of this data. As donor management systems converge with CRMs, it becomes less likely that organizations will need separate volunteer, vendor and member management systems—a dashboard could provide a view of data from across the organization in a single place.
The current trends in donor management systems raise exciting possibilities for organizations, whether they’re considering their first system or an upgrade. As the newest systems on the market distinguish themselves from prior offerings, there’s more and better choices than ever before. 
Future Trends: Best Guesses for the Next Generation Software
As vendors respond to the popularity of mobile devices and cloud computing by shifting from device-specific applications to browser-based systems, next-generation donor management systems will become more practical for tablet PC use. Aside from portability, this also means some conveniences currently available only on mobile devices could gain broader use—like Google Voice, for example.
Google Voice responds to a user’s verbal cues with appropriate actions. For a donor management system, this might mean being able to tell a tablet PC to “send thank you letter to the Gates Foundation.” A wizard might help the user create and email the letter hands-free, shrinking the functionality gap between tablets and laptops.
But with the rise of cloud computing come new obstacles. With traditional installed software, users log on to their machines or network and access all their files—cloud storage is less user-friendly. For example, to attach a photo stored in Picasa Web and a contract stored at to a volunteer record stored in a cloud-based donor management system, a user might need three sets of user names and passwords.
Some companies are addressing this problem of credentials proliferation by providing a single sign-on for cloud-based resources—one username and password logs users into multiple applications and storage services. Others, like Salesforce, now allow users to access cloud-based files through a single Google Apps login, even though the two systems exist in separate clouds. Additional solutions are likely just around the corner.
More and more vendors are moving their systems to the cloud, where users are going. Features like these will go a long way toward making these next generation cloud-based donor management systems as familiar and convenient as traditional installed software packages.


Copyright The Nonprofit Times