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Getting started with data segmentation in charity fundraising

There is not better time than now to start your data segmentation to make your individual giving fundraising even better!

Data segmentation is undeniably a powerful tool for non-profit organisations when it comes to increasing fundraising impact. But when is the right time to start thinking about segmentation? Should charities wait until they have a certain size of a database or a specific number of supporters in each segment before they begin?

The truth is: the best time to start segmenting is now.

This blog looks at when and how to start data segmentation so read on to find out more and how partnering with a data specialist can help…

Why should charities start segmentation now?

It’s all about relevance.

We all know that receiving a communication that is relevant to us makes us engage with it more: after all, we’re already interested!

Well, in a similar way, supporters will often feel connected to the causes they support in different ways, or want to be communicated with in certain ways. And segmentation allows charities to deliver communications tailored to the unique preferences and interests of their donors. As such, even from the earliest stages of building a supporter base, charities should begin applying the principles of segmentation.

What types of information should charities start segmenting with?

You might think that you need a fairly decent database to start segmenting effectively, but that's simply not the case.

Starting small doesn't mean waiting until you have a sophisticated CRM system in place. Even a basic Excel spreadsheet can serve as a starting point for organising supporter data. By capturing simple information such as donation amounts, response channels, reasons for giving, date of last gift and number of gifts you can lay the foundation for future segmentations.

For example, imagine a charity receives its first donation from an individual who contributes £10 to an online research appeal. Even with limited data, the organisation can begin segmenting this supporter based on attributes such as donation amount (£10), campaign type (appeal), donation frequency (first / date), donation recency (0-12m), giving channel (online), and interest (research). Future communications can therefore utilise this information by:

  • Asking at an appropriate level (i.e. starting at £10 for next gift)
  • Using a responsive channel (i.e. email, given previous digital response)
  • Talking about a relevant subject (i.e. research activities)

The charity can also test other approaches such as:

  • Will the supporter respond to a different type of giving (i.e. a committed gift)
  • Will they respond via a different channel (i.e. telephone)?
  • Are they interested in other aspects of the charity’s mission?

Pretty young girl thinking with colorful abstract lines overhead

What other types of information can charities use?

As your database grows, segmentation approaches can evolve accordingly. While it's essential to start with the basics, such as product and channel preferences, you should aim to continually refine and expand your segmentation criteria. This might involve incorporating additional data points, such as donor demographics, engagement levels, or motivations for giving.

This data can be obtained through a variety of primary and secondary sources. For example, you might include some simple questions on a response device or send out a bespoke survey to your supporters. You might also choose to use a third party such as a YouGov for a bespoke survey or as part of an omnibus survey or you could use a demographic overlay like acorn or Mosaic to help understand your supporters better and therefore communicate in a way that is more relevant to them.

Charity data segmentation should evolve over time

Importantly, segmentation should not be viewed as a static process. Just as supporters' preferences and behaviours evolve over time, so too should segmentation strategies. You need to be prepared to adapt and refine your segmentation criteria to reflect changing donor dynamics and your charity's priorities.

For instance, if a charity’s donor base has been predominately mail responsive supporters, but then they run a digital campaign which creates a significant number of new digitally responsive supporters, that may change the type of data that can be captured both initially and ongoing. Existing segmentation criteria may no longer be valid as new channels will be available, new demographics and new motivations.

We therefore highly recommend a regular review of your segmentation criteria and strategy. At least annually! You might not need to change anything, but equally, making changing might revolutionise your ROI.

Charity data segmentation enables better decision making

Moreover, segmentation is not just about dividing supporters into discrete groups; it's also about fostering a culture of data-driven decision-making. By regularly analysing segmentation data and tracking performance metrics, you can gain valuable insights into what resonates with your supporters (or which supporter segments) and what drives fundraising success.

In summary, the timing of data segmentation in charity fundraising is more about mindset than milestone. While it's never too early to start thinking about segmentation, charities should approach the process with a focus on relevance, scalability, and adaptability. By starting small and growing strategically, non-profits can harness the power of segmentation to engage donors, drive revenue, and advance their mission.


Finding the right data segmentation partner

If you’re wondering how to get going with segmentation, talk to an expert.

Charity partners of Woods Valldata benefit from the expertise and advice of our data strategy team to support data-based decisions and strategic direction. But if you're not already working with us, our sister company, Sequoia Insights, provides impartial data-informed engagement strategies for charities and membership organisations to step up the value they get from their data. Building a deeper understanding of supporters or members and creating a self-sustaining data powered engagement strategy.

Why not reach out today and start your data segmentation journey to success?

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