Choosing a Donor Database: Ultimate Guide for Nonprofits

Choosing a Donor Database: The Ultimate Guide for Nonprofits
Boost your donor profiles.
Target donor communications.
Improve future operations.

Choosing a Donor Database:
Ultimate Guide for Nonprofits

What is a Donor Database?

Also known as a constituent relationship management database, a donor database is a software solution that houses the most important information you have about your donors. Many donor database solutions offer a wide array of other useful features, such as analytics and automatic messaging.

Why is Donor Database Software Important?

A donor database is more than just a digital file folder — it’s a way to save your staff time and bring your supporters closer to your nonprofit. With communication and reporting functionalities, donor database software helps you make your nonprofit operations smoother.

Does Your Nonprofit Need a Donor Database?

Unless you have an unusually small number of donors, a nonprofit donor database will save you time. If you’ve ever taken 10 minutes to look up a donor’s contact information, volunteer history, or average gift size, then a donor management system will change the way you operate.

Note

Purchase the perfect fundraising software! Download our Top 10 Questions to Ask When Considering Fundraising Software!.

Elements of Donor Databases

Common Features of Donor Database Systems

Donor databases keep your constituents' information safe and organized.

Donor Profiles

You need one centralized location to house the important details about your donors, from their birthdays to their payment information to their history with your organization. Donor profiles organize all this information, including predetermined and custom fields.

Keep track of your communications with your donor database.

Communications Management

When you use a donor database to track your communications, you’ll never have to worry about forgetting whether you already invited that one major donor to your event. Plus, you can segment your supporter base to send more targeted, effective donation requests.

Donor databases make scheduling and automation easy.

Automation and Scheduling

Whether it’s a periodic reminder to update payment information or an automatic thank-you message for a donation to your annual fund, your donor database software can make sure the right people receive the right message at the right time.

You can use the analytics tracked by your donor database to make your operations better.

Data, Analytics, and Reporting

All donation management software should store data about how your donors have given and engaged with your communications in the past. Some will help you understand how this information can make your operations better in the future by producing reports.

Keep your eye on donations trends with your donor database.

Donations Management

Accepting donations is a cornerstone of your nonprofit’s operations, and it doesn’t take complex financial software to do it. Some donor databases will facilitate payment processing and funds allocation, then combine those records with your donor profiles.

Customize your donor database with custom fields and hierarchies.

Custom Fields and Hierarchy

We know that no two nonprofits are the same, especially when it comes to the supporter information that they need to store. You can reflect the reality of your organizational structure by setting custom fields and hierarchies for your donor profiles.

Salsa Labs' CRM keeps comprehensive donor information within the donor database.

The most important element of a donor database is its constituent profiles. Housing giving history, contact information, and other important details, these donor profiles should be easy to update, scan, and search. Take a look at Salsa Labs’ CRM for a great example of an easy-to-use donor profile.


Benefits of Using Donor Database Software

  • Engagement

    Do you know which of your constituents have children, which hold C-level positions at work, and which like to get letters in the mail instead of in their email inboxes?

    The best way to keep your donors engaged is to store all this information in an easily accessible place, then let it inform your communications with them!

    Donor databases allow you to create custom fields in your donor profiles, and then segment your donors based on these custom fields. Your donors will be more likely to respond to messages tailored specifically to them.

  • Automation

    There are many things that software will never be able to do as well as your staff, like build meaningful relationships with your incredible supporters.

    But there are some tasks that your staff wastes time with unnecessarily. Why not let your donor database take care of those?

    Good nonprofit donor databases will automate things like notifications for fundraising events, requests to update contact information, and validation of payment information so you don’t have to do them manually.

  • Analytics

    You can’t get better in the future if you don’t look back on where you’ve been. When it comes to donor management, the best way to look back is by keeping impeccable records.

    Donor databases store more than just basic information such as your donors’ names and email addresses — they also track communication, donation, volunteer, and event attendance history.

    You can find donor database software that helps you make sense of all this data through professional, meaningful reports based on the software’s analysis of your records.

  • Consolidation

    If your financial department houses all your donors’ payment information but the advocacy team keeps track of contact information, what happens when a donor moves? Who does the donor contact, and will they know where and how that information needs to be changed?

    By implementing one donor database software for everyone across your organization to use, you ensure that all the key information about your donors ends up in one place.

    Consolidating your donor details helps you cut down on administrative error, which saves you time and money.

Nonprofits can take advantage of automatic reports from donor databases like Salsa Labs' CRM.

To make use of the information gathered by your donor database, good solutions like Salsa Labs’ CRM provide automatic reporting.


Note

Purchase the perfect fundraising software! Download our Top 10 Questions to Ask When Considering Fundraising Software!.

Purchasing a Donor Database

Considerations Before Buying a Nonprofit Donor Database

Make sure your donor database can house as many constituents as you need.

Number of Constituents Supported

How many donors do you have? As you grow in the next few years, how many will you gain? How much information do you need to enter for those donors? Make sure that the donor database you choose has the capacity to handle your full supporter base.

Also, don’t forget that many donor databases are priced based on the number of constituents they can store. Make sure you’re purchasing a donor database that meets your capacity and your budget.

Every donor database offers different features, and you need the solution that's best for you.

Features Offered

Not every nonprofit will need the same features in its donor database software. Take stock of the tasks that your staff spends too much time on, then look for software that can help you automate them.

You should also look into to how a good donor management system can expand with your organization in the future. If you don’t need a specific reporting feature right now, for example, consider whether you might need it later as your nonprofit grows.

There's no need to break the bank or overwork your staff to implement a new donor database.

Budget and Staff Availability

There’s no need to break the bank for a donor database. You might need to look for fewer features or lower capacity to accommodate a lower budget. And budget goes both ways — just because you can afford an all-inclusive solution doesn’t mean you need it, and it might actually overcomplicate your operations.

Take into account the time you have available, not just the money. If a donor database will take too much of your staff’s time to learn, then you should look for a simpler solution.

Keeping your donors' information safe in your donor database is of utmost importance.

Platform Security

The information you know about your donors is valuable to you, but you’re not the only one. Your donors trust you with their information. You owe it to them to keep that information safe.

You might not be able to find out from a website how a donor database provider keeps their data safe. It’s worth it to request a call to ask about security, and to ask other nonprofits about their own experiences with the product.

DonorPerfect allows you to specify different permissions for each user of the donor database.

Keep your donor information and your organization safe by choosing a donor database like DonorPerfect that allows you to program custom permissions for different users.


Common Donor Management Software Pitfalls to Avoid

Don't forget to set up separate permissions for different users of your donor database.

User Profiles and Permissions

Chances are good that more than one person at your nonprofit will need to use your donation management software. Don’t forget to ask the software provider how many user profiles you can create and if the price affects that number.

And also remember that it’s good security practice to restrict access from some users. Not everyone needs administrative access to view or modify your most sensitive information.

Custom solutions are more expensive, which should play a part in your purchasing decision.

Price and Customization

The price listed on the website isn’t always what you end up paying, and one of the major culprits of a price hike is customization.

If you’re asking for a customized solution, be prepared for the price tag. Many nonprofits will find that it’s worth a little more to get a software solution build precisely for their needs, but just make sure you talk this over with your team before signing the contract.

Don't just rely on online reviews — go looking for referrals from your peers in the industry.

Referrals and Outside Opinions

It’s good consumer practice to read online reviews before making any purchase. You should definitely read reviews of any software you’re considering.

As you read, remember that companies with extremely good or bad experiences are the most motivated to post. Ask the provider for testimonials, and be sure to also ask around yourself.

Implementing Your New Donor Database

Demos and Trials

Will you get to use the donor database on a demo or trial basis before committing to a long-term contract? What kind of support will be available to you for that time? What will it cost you to initiate a trial period or cancel a demo?

Support and Training

Especially if you don’t have a technical team on staff, will your donor database software provider send a team to train you? Can you reach someone on the phone if something goes wrong after initial onboarding?

Integration

What other software solutions does your nonprofit rely on? Will you need to integrate them with your new donor management system, and is that even possible? Could you replace your current software with features that comes built-in to a database?

Data Migration

If you’re not keeping your other software solutions, how will you move the information you need over to your new donor database? How long will that process take? Will you need access to your records in the meantime?

Scalability

As your organization grows, will your donor database have the ability to grow with it? Can you add constituent capacity or additional features when you need them? What kind of pricing increase would that involve?

Sustainability

How complicated is your donor database system to use? How hard is it to teach a staff member to use? Do you have written or video training materials? Is there one staff member designated as the point person for questions about the software?

Additional Donor Database Resources

Top Donor Management Software for Your Nonprofit


Make sure your nonprofit uses the best donor database for it.

Now that you’ve got the basics of donor databases under your belt, it’s time to find the perfect solution for your organization.

We’ve got you covered — check out our reviews and rankings of the top donor management tools for nonprofits.


Must-Know Nonprofit Software Solutions


Looking for other kinds of nonprofit software? Check out this guide for donor databases and other useful solutions.

Overhauling all your software solutions, not just your donor database? Become your organization’s nonprofit software expert.

Get familiar with the top nonprofit software in any sector before making your next software purchase.


Best Membership Management Software


If you need something more general than a donor database, check out a membership management solution instead.

Do you need something different than donor management software to keep track of your supporters?

Try one of the membership and association management tools that made our list of the best in the business.