Creating a Healthy Prospect Pipeline
By Nicole Nakoneshny
(April 12, 2011) Ask any good fundraiser why it's important for an organization to maintain a healthy pipeline of prospects, and they will basically give you the same answer. While the words may be different, the key theme is that as a fundraising operation, your pipeline is your lifeblood. It, along with your case for support, is the foundation upon which the success of your fundraising is built.
So what exactly is the prospect pipeline? And how can you tell if yours is healthy?
The prospect pipeline places cohorts of prospects at different stages of the development cycle (identification, cultivation, solicitation, stewardship) and then measures their progress as they move from an unqualified lead to (hopefully!) a donor.
Indicators of a Healthy Prospect Pipeline
1. Active prospects at all gift levels. A great way to test health on this factor is to do a gap analysis, mapping the prospects in your pipeline against your fundraising chart of standards, a tool that outlines the number of gifts at each gift level required to reach your fundraising target.
2. Active prospects at all stages of the development cycle. Another key indicator of a healthy prospect pipeline is to have adequate prospects in identification, cultivation, solicitation and stewardship. It is important to assess both the number of prospects as well as the prospective revenue that they represent.
3. New prospects are added regularly. In order to maintain a healthy pipeline, there must be adequate mechanisms to feed new prospects into it. This is basically your prospect identification strategy.
4. Prospects are moving through the pipeline. Another key to a healthy pipeline is the movement of prospects through the different stages of the development cycle, keeping a watchful eye for prospects that get ‘stuck'.
5. Access to good data. The health of your pipeline is only as good as your ability to analyze it. And your ability to analyze will only be as good as the quality of your data as well as your ability to access it.
It all starts with finding them
Developing and maintaining a healthy pipeline starts with prospect identification. And for many organizations, particularly those that are just starting to fundraise or that are trying to grow their fundraising revenues, this exercise can be a challenge.
Outside of the traditional source of new prospects (the research department) there are a number of strategies for finding new prospects. Some examples include:
- Making every interaction with the organization an opportunity to gather names. From event participants, to volunteers, to third party fundraisers, find ways to gather contact information to enter into your database.
- Taking a page from the for-profit sector, think of new ‘markets' that would have an interest in you and develop strategies to tap into them.
- Developing culture of inquiry in your organization to encourage everyone to bring forward names of new prospective donors.
I would be remiss if I didn't mention one of the new and emerging ways that development operations are identifying new prospects - the growing field of data analytics.
Often, when fundraisers talk of analytics, they use the word "data mining" as the catch-all term to describe this activity. But, data mining is only one of several techniques available. Data analytics can be any number of statistical tools and techniques (including data mining, predictive modeling, database screening) that are used to analyze constituencies and build models to predict behavior. Determining which to use depends on what exactly you want to achieve and the depth and breadth of your data.
Not just about prospect ID
While prospect identification is the starting point for most organizations when thinking of their pipelines, it's also unfortunately often the place they stop. At KCI, we think that's a mistake as cultivation and solicitation, while rarely associated with building a healthy pipeline, are where pipelines often start to ‘leak'.
A reason for leakage at the cultivation stage is lack of accessibility, as fundraisers often can't (or don't know how to) ‘get in the door' or access the prospect. A great ‘fix' can come in the form of volunteers, who are often willing and best able to open the door to the prospect.
However, getting in the door doesn't just mean being able to hold a face-to-face meeting. As fundraisers, we need more in our engagement tool kit than visits. Organizations should arm their fundraisers with a variety of ways to engage prospects, including program offerings, communications tools and volunteer opportunities.
The development of cultivation strategies is another spot where data analytics can play a role. By understanding the demographics and interests of your prospects and current donors, you can develop engagement strategies/opportunities targeted specifically to them.
Don't forget your case
The solicitation phase of the development cycle is the second major source of a leaky pipeline. And often, we need to look no further than the case for support to understand the reason why.
For many organizations, the case simply doesn't have compelling priorities at all gift levels. Commonly, there are attractive opportunities at the top end of the gift chart, and/or good opportunities near the bottom. But in order to have success at soliciting gifts at all levels, you must have compelling and attractive funding priorities at a variety of gift levels. So assess your case with this criterion in mind. A good approach can be to find ways to ‘bundle' or ‘unbundle' priorities depending on the size of the ask.
Regularly analyzing your pipeline to understand where it is leaking and address the reasons why is a valuable and important undertaking. And it is one that will pay for itself over and over through improved fundraising results.Nicole Nakoneshny is vice president at KCI (kciphilanthropy.com), a Canada-based organization dedicated to helping philanthropic organizations. This article is adapted from a recent issue of KCI's Philanthropic Trends Quarterly.
Related AFP ResourcesQ&A with Nicole Bailey
Columbus, Ohio Fundraiser Receives Achievement Recognition from AFP
Boosting Fundraising Skills with Assessments and Training
Stick With Us—We’ll Carry You Through Your Entire Fundraising Career!
Ottawa Fundraiser Leah Eustace Earns Highest Professional Fundraising Credential from AFP