How CRMs can boost charity performance

Customer Relationship Management (CRM) software – or in the not-for-profit world Constituent Relationship Management – is a very useful tool for charities, helping them to organise and manage all interactions and relationships with people interested in their cause, from one centralised platform.  

Constituent details housed in your CRM can include information from donors, prospective donors, members, volunteers, partners, vendors and so on – being able to keep track of and tailor communications to these various audiences easily is vital.

How can CRMs enhance charity performance? 

Most CRM systems offer charities helpful features such as donor and volunteer management, campaign management, donation management (including the ability to take payments), donation accounting, fundraising event management, as well as providing analytics and reports. These will be helpful later when evaluating your performance.  

Charities are becoming increasingly data-driven, with nearly half of charities saying it had become a big priority for them in the Charity Digital Skills Report 2021. Organisations need to know what works for their audience and what doesn’t in order to determine the direction of their charity and the content of their communications.  

With the donor retention rate of the sector sitting at just 43% overall,  identifying and managing your relationship with them is crucial – a CRM system helps you do just that.

Retaining donors  

CRMs play an important role in helping you to hang on to your donors. The systems provide donor (and other constituent) retention tools which help with membership drives, engagement in volunteer projects, or pledge management.  

Bringing together social, website, and financial data (all compliant with UK-GDPR legislation) helps give charities a complete picture of their donors, including how often they donate and how often they engage with their content.  

Charities can then tailor their interactions so they’re not asking the same people for funds continuously and targeting the same audience with emails. This leads to a reduction in email unsubscribes and keeps supporters happy so they’re more likely to return to you in the future. 

And that is important because, according to the Harvard Business Review, a 5% reduction in your customer defection rate can increase profits by up to 95%. Imagine the impact this can have on your fundraising.

Possible challenges 

As you can see, CRM systems are useful, but they do still present some challenges for charities. Implementing them involves changing existing processes, and usually requires some training, too. 

• • Cultural change 

It can involve cultural changes, because putting all data in one centralised system means staff no longer "own" specific donors or store contact histories in their own spreadsheets or contact management software.  

Isolating data in such a way can lead to bottlenecking and reduce productivity, impacting both your supporters and beneficiaries in the service they receive. With a CRM system, however, data is designed to be shared with other staff – it is only when they are willing to do this that it can be utilised to its full extent.  

Charities looking to understand more about managing change can find out more on the Charity Digital website, along with advice on how to simplify their data.  

• • Cost 

Then there’s the cost involved in introducing any new software. That includes the software, but it may also include integration with other systems such as email and consultancy fees.  

Ultimately, it depends on the system you choose to use.  Many CRM systems are cloud-based. That means that

charities don’t need to buy, run, and maintain the software themselves, instead paying a monthly per-user fee. 

This also makes it easy for staff to use the system even if they work mainly from home, and for the charity to add or remove users, paying only for the people who need to use the CRM system.  

Charities can find a myriad of CRM systems available at a discount on the Charity Digital Exchange, including Microsoft Dynamics 365. Microsoft has partnered with organisations like m-hance to offer charities specific assistance with this software, for charities looking for more guidance.  

M-hance’s Microsoft Dynamics 365 Buyer’s Guide for Not-for-profits, for example, outlines what charities need to look for when choosing their CRM system.

The success stats 

Despite the challenges, the question remains: do all the various functionalities of CRMs actually make a difference to charity performance? 

The answer is yes. More than four in five charities using CRM software say it increases their income and saves them time.  

Here a few more specific examples of CRM helping charity performance: 

• • Médecins Sans Frontières UK has been working towards a 360-degree view of supporters and has increased its supporter base by over 16,000 records in 6 months, enabling the team to raise more donations and continue to deliver emergency medical aid to patients where the need is greatest. 
    
    
  • Oxfam Ireland was able to improve its interactions with supporters by implementing Microsoft Dynamics 365 to capture and compile detailed information about them in one centralised place. It transformed “the levels of communication we have with our fundraisers and supporters by making it is easy for us to keep them fully informed about our activities”, said Hugh Walker, Finance and Corporate Services Director at Oxfam Ireland.
      
  • Motor Neurone Disease Association has improved how it manages its nationwide network of volunteers by sharing information through an online portal, delivered through Dynamics 365.  

• • Solent Mind saw a 25% increase in staff productivity after implementing its new CRM system, as employees could retrieve vital, but complex, data in minutes, rather than the days it had taken previously. 

So, although factors like the level of training required, acceptance of the new system by staff, and the degree of help provided by CRM consultancies undoubtedly affect the outcome, the answer to the question: "Can CRM systems really help improve charity performance?" seems to be: "Yes they can".