Nonprofits' Newest Benefactor: Data

Nonprofit organizations have always relied on the kindness of strangers to support their causes and spread their missions, but many groups have struggled in recent years as donations from cash-strapped supporters dried up.

The likes of the Red Cross and other groups could build their coffers back up to pre-recession levels with the use of data analysis to inform digital marketing campaigns and outreach efforts, according to Knowledge@Wharton, the online business journal for the University of Pennsylvania business school. 

Donations typically come pouring in after a natural disaster or some other devastating event moves consumers to give to those in need, the source notes. Yet many of these benefactors become one-time donors, and the Red Cross is working to figure out a way to make people long-term supporters.

The nonprofit has partnered with Wharton and data scientists from around the country to assess engagement and response rates, donation patterns and other metrics that could provide insight for more effective targeted advertising.

Eric Bradlow, Wharton marketing professor and co-director of the Wharton Customer Analytics Initiative, told Knowledge@Wharton that efficiency and donor conversion are vital to the nonprofit sector, since those groups are usually working with limited budgets. A secret could be in mining individual donor data for tips on how to distribute the message as far as possible and connect with the greatest number of potential donors. 

Kurt Kendall, a leader in the Consumer Marketing Analytics Center at McKinsey, told the news outlet that companies have a vast number of consumer touchpoints to work with - social media, websites, mobile devices and more.

"The amount of data these channels create has expanded significantly, too. The technology has developed to combine all this data so that you have a 360-degree view of that customer," he said. "That includes not only when customers interact with you, but also when they interact with someone else." He added that if managed correctly, the data can be a "tremendous asset."