What are the best practices for prospect research in the nonprofit sector?

1 Define your goals

Before you start your prospect research, you need to have a clear idea of what you want to achieve with it. Do you want to find new prospects, segment your existing database, prioritize your outreach, or plan a major gift campaign? Depending on your goals, you will need different types of data and methods to collect and analyze it. For example, if you want to find new prospects, you might use screening tools, referrals, or social media to discover people who match your criteria. If you want to segment your database, you might use RFM analysis, ratings, or scores to categorize your prospects based on their recency, frequency, and monetary value of giving.

2 Use multiple sources

One of the best practices for prospect research is to use multiple sources of information to get a comprehensive and accurate picture of your prospects. You can use both internal and external sources, such as your own donor database, annual reports, newsletters, surveys, interviews, websites, databases, directories, publications, or social media. However, you should also be mindful of the quality, reliability, and relevance of the sources you use. You should verify the data you collect, update it regularly, and respect the privacy and preferences of your prospects.

3 Focus on the key indicators

Another best practice for prospect research is to focus on the key indicators that can help you assess your prospects' potential and likelihood of giving. These indicators are usually divided into two categories: wealth and affinity. Wealth indicators are those that show how much money your prospects have or can access, such as income, assets, liabilities, expenditures, or philanthropic involvement. Affinity indicators are those that show how much interest and connection your prospects have with your cause, such as past giving, engagement, values, hobbies, or networks. By combining these indicators, you can estimate your prospects' capacity and readiness to give and tailor your solicitation accordingly.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?