How Digital Fundraising Supports Nonprofits
The use of AI in fundraising begins with organizational software. Donor management systems, which are similar to customer relationship management software, help nonprofits track their donors and organize their budgets.
Where organizations might once have relied on commercial software (such as spreadsheets, which don’t track relationships) or built their own tools from scratch, they now use AI to cut code-writing time in half, reports McKinsey. From there, digital tools allow nonprofits to measure the frequency and impact of their donations.
Donor management systems and other digital tools excel at identifying and targeting donors. They help nonprofits spot industry influencers and drive engagement with them, support targeted outreach with segmented email lists and boost direct engagement with donors through text messages and other mobile strategies.
When the American Lung Association doubled down on its digital fundraising, it found new audiences who supported its mission. Leaning into its video distribution platform and influencer campaign with actress Laura Dern, the ALA boosted its digital fundraising by 27 percent year over year.
AI Can Help Nonprofits Segment Their Audiences
More than just enabling organizations to reach new donors, AI allows them to segment their audiences, helping to identify where their efforts will be most effective.
“The people that are interacting with your organization are not all the same, and you should not treat them all the same,” Cherian Koshy, vice president of development at the nonprofit Merit America, told The Chronicle of Philanthropy. “Someone who’s given to your organization for 20 years is very different from someone who has not given to your organization before.”
This ability to target donors can fine-tune outreach, granting organizations visibility into when to hit fundraising hard versus when to share other messages.
For example, nonprofits have sent more emails so far this year than they did in 2022, but email has accounted for less online revenue than it did last year.