The Nonprofit Marketing Blog

What is a Donor Management System, and Why Should My Nonprofit Use One?

What is a Donor Management System, and Why Should My Nonprofit Use One?

The more you know about your donors, the better able you’ll be to connect with them. You’ll know what’s important to supporters and learn how to deliver a better donor experience, retaining them for the long term.

What is a Donor Management System?

Donor management system (DMS) software helps you collect, organize, and make use of donor data. DMS software functions much the same as customer relationship management (CRM) software, but with marketing capabilities added in. Most DMS software includes donor profiles, provides the ability to segment based on profile fields, and offers campaign management and task management capability, along with a dashboard for at-a-glance insights. A DMS allows nonprofits to customize their communications, personalize their fundraising campaigns, and streamline their operations, all in one easy-to-use software. 

Approximately 70% of nonprofit funding comes from individual donors. While grants, foundation gifts, and corporate gifts will always be core sources of funding, the highest potential lies in the gifts of individual donors. For this reason, a DMS is an important tool for nonprofits.

Why Your Nonprofit Should Use a DMS

Sure, your team could track donor data using spreadsheets and run campaigns using a collection of webpage builders, design software, and email marketing software. But a DMS turbocharges your team’s capabilities. Here’s how.

  1. Automation Frees Staff Time — In our experience, nonprofit teams always have more on their to-do lists than they have time to get those tasks completed. Because a DMS allows you to automate repetitive manual processes, your team can do more with less. You’ll benefit not only from having the ability to run more campaigns, but your team will also be less stressed in the process.
  2. Segmentation Enables Personalization — When you can easily segment your donors by interests, characteristics, and giving history, you can better personalize your communications. Send specific appeals asking for support for particular programs to the donors most likely to give. Be more descriptive in your thank-yous, letting donors know that you truly appreciate their contributions. Invite the donors most able to contribute large gifts to your top-tier events.
  3. Data Lets You Leverage Strategic Donors — With a DMS, you can easily see which donors are most committed, in terms of both volunteer time and financial support. If you track the data, you can also see which donors have the broadest networks and know other potential donors. With this information, you can focus on these donors with specific requests that they’re likely to respond to because of their commitment. 
  4. Data Helps You Retain Donors — With a thorough understanding of your donors, you can better craft a donor stewardship program that resonates with each type of donor. You can determine what donors would appreciate most and how to make your thank yous more meaningful. When donors can sense that they are valued as individuals, they are more likely to feel a part of your team, and more likely to stay committed for the long term.

In addition to giving you invaluable insight into your donors, a DMS essentially provides you with an additional team member who can step in and handle the rote tasks that take up so much time when done manually. With a DMS, your nonprofit will be able to function more efficiently, operate more effectively, and increase revenue through more strategically-crafted campaigns. 

Want to learn more about how a DMS can help your organization and what to look for in a DMS? Read our Buyer’s Guide to Nonprofit DMS Software.


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About This Blog

Carrie Saracini
Content Marketing Manager

We’re here to help you win hearts and minds—and donations.

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