Integrated Analytics Drives Success

Transcription

1 Integrated Analytics Drives Success by Andrew Schultz, Director of Analytics The opportunities for leveraging data analytics within fundraising are nearly limitless and the value of investing in a robust analytics program is clear. Today s leading analytics programs are creating efficiencies in all corners of the fundraising industry. The pace and breadth of expansion into new data sources, methodologies, and directed towards a more diverse audience than ever before signals a bright future for the growing number of fundraising programs where the comprehensive adoption of analytics is the norm. BWF Insight launched our 8 th annual survey of the fundraising analytics community in May We sought to discover the trends in analytics methodology, applications, and tools popular with today s analysts, paying special attention to the impact across the industry. We received responses from across the United States, Canada, and Europe from data practitioners working at organizations representing every sector in the industry, and raising a wide spectrum of funds annually. Here s what you had to say. Copyright 2017 Bentz Whaley Flessner

2 Key Findings Analytics continues to have a significantly positive impact. Among established analytics programs, 93% of respondents cite the positive impact data analytics is having on their fundraising. Nearly 5 are able to quantify and measure the contribution analytics has on their fundraising programs. Analytics is being utilized by a more diverse audience than ever before. The most successful fundraising programs are those in which analytics has been adopted by and integrated into a wide array of user groups, including vice presidents, major and principal gift officers, annual giving teams, and prospect development/prospect research staff. The use of social media and web log data is on the rise. We saw a 13% increase in the use of social media data this year, and a 7% increase in web log data compared to last year. Limited staff resources and time remain the biggest obstacles. 61% of respondents cited staff resources as an obstacle to successful analytics implementation, while 57% cited insufficient time as an obstacle. Analytics Programs Positive Impact Once again, the majority of this year s survey respondents cite the positive impact their analytics program has on their institution. Among respondents at established programs, 93% cite this positive impact, with nearly 5 of those respondents also able to rely on measurable results to back that claim. One fifth of this year s respondents (20.6%) are building their analytics capabilities, saying it s too early to quantify the impact. Only 7% have not observed any impact a decrease from 1 since 2015 s survey; and, once again, no respondents reported a negative impact. No observable impact 7.4% Impact of Analytics Among Established Programs Positive (unsure how to measure) 44.1% Positive (measureable results) 48.

3 Impact of Analytics at Institution Positive (measureable results) Positive (unsure how to measure) No observable impact Negative It's too early to tell Interestingly, since 2015 an increasing percentage of respondents see the positive impact of analytics but are unsure how to quantify the benefits. It appears this increase is directly related to the maturation of fundraising analytics practitioners within our industry: analysts rating themselves as advanced or expert were much more likely to recognize and be able to quantify the positive impact of their analytics programs. Impact of Analytics Program by Competency 4 3 Novice Intermediate Advanced or Expert Too early to tell No observable impact Positive (unsure how to measure) Positive (measureable results)

4 Diversification Prospect management/prospect research teams have historically been and remain among the primary audiences for data driven analyses. This is also reflected in the fact that survey respondents cite prospect identification as one of the primary applications for analytics. However, this year our survey indicates a growing diversification within the fundraising analytics community. Major and principal gift officers, vice presidents, and annual giving teams are all receiving data driven analyses now more than ever before. We are also seeing analytics permeate to the level of organizational leadership. Alumni Association 2% Board 3% President/ Chancellor/ Exec. Dir. 6% Prospect Research/ Management 21% VPs Advancement Services 11% AVPs 7% Annual Giving 16% Major Principal Gift Officers 19% This level of analytics diversification across fundraising programs exemplifies the growing understanding of the value presented by the comprehensive adoption of fundraising analytics, as well as the importance of the analytics practitioner as a central hub of insights and information sharing. In fact, survey responses indicate that organizations which have integrated analytics across the entire fundraising program are more likely to cite the positive, measurable impact of analytics on their fundraising success.

5 Comprehensive Adoption of Analytics Drives Positive Outcomes No observable impact. Positive, but unsure how to measure. Positive, with measureable results Board President/ Chancellor/ Exec. Dir. VPs AVPs Major/ Principal Gift Officers Annual Giving Advancement Services Prospect Research/ Management Alumni Association In addition, analytics professionals continue to explore new techniques to help them drive change at their organizations. This year s survey responses indicate the broad range of uses for analytics as well as myriad techniques employed by practitioners within the fundraising community Analyzing Staff Performance Direct Response Segment ation Donor Retent ion/ Reactivation Establishing Financial Projections Geographic Analysis New Donor Acquisition/ Conversion Pipeline Management Portfolio Optimization Prospect Identification Relationship Management Setting Fundraising Goals Prospect identification continues to be the most commonly cited use for analytics among survey respondents, mirroring past year trends. Portfolio optimization and pipeline management also remain popular. Interestingly, there was an 8% drop in donor retention/ reactivation compared to last year, while new donor acquisition/conversion held steady.

6 Regression Pointbased Ranking Clustering or Persona Profiling Descriptive Program Analysis Decision Trees Classification Forecasting or Simulation Social Network Analysis Time Series Factor Analysis Ensemble Models When asked for the top three analytical methods being employed by practitioners, regression remained the most popular choice. This year, a larger percentage of respondents cited point based ranking over both clustering and classification. Although the use of social media data is reportedly on the rise, less than 1 of respondents cited social network analysis among their top three. Also of interest is the relatively low rate of response for decision trees, factor analysis, and ensembling. Each of these methods have proven to be more accurate and adaptable to a wider range of problems than traditional regression and classification solutions, however, only a small percentage of respondents appear to be utilizing these techniques. There are also signs that analytics professionals are being asked to lend their expertise to a wide array of projects and are potentially putting themselves at risk of being stretched too thin across the organization.

7 Number of FTEs Who are Primarily Responsible for Analytics at Your Organization The majority of respondents reported having one or fewer full time staff members dedicated to analytics, while the proportion of respondents citing staff resources as an obstacle to successful analytics implementation actually rises with the number of years the organization has had in house analytics staff. There is clearly a recognition of the value presented by fundraising analytics, but overall investment in in house resources appears to be lagging behind current demand for these important skills. Respondents Citing Staff Resources as an Obstacle by Number of Years with In-House Analytics Staff 1 2 years 7% 6+ years 47% 3 5 years 46%

8 Additional Data Sources This year s survey saw a marked increase in the active use of and interest in additional data sources. Namely, social media and web log / click stream data. While respondents usage of text mining remained largely static since last year s survey, use of social media and web log / click stream analytics have risen 13% and 7%, respectively Current Use of Text Mining at Institution Currently using Plan to start Would like to, but unsure how to implement No plans to start Respondents use of text mining remained largely static since our last survey. Of note is the decrease among respondents with no plans to begin analyzing their text data Current Use of Social Media Data at Institution Currently using Plan to start Would like to, but unsure how to implement No plans to start Respondents have clearly grasped the value of putting available social media data to work for the benefit of their institutions. In addition, there is an 8% decrease in the number of respondents with no plans to start utilizing social media data, an indication that we can expect even more growth in this area in the coming months.

9 Current Use of Web Log / Click Stream Data Currently using Plan to start Would like to, but unsure how to implement No plans to start As with social media analytics, this year s respondents demonstrated an increased interest in web log / click stream data. The number reporting currently using this data rose 7%, those who would like to, but are unsure how to implement rose 8., and the number with no plans to start decreased by 13%. We expect this additional data will provide significant benefit to existing analytics projects as they are integrated into descriptive analyses, predictive models, portfolio optimization/segmentation, as well as for use by prospect researchers to develop more comprehensive profiles. Some Obstacles Persist, Others are Mitigated Overall, the obstacles standing in the way of successfully leveraging analytics remain largely unchanged. Limited staff resources and the lack of sufficient time made up the majority of responses for the third year in a row. However, we suspect these would both be among the most frequently cited obstacles for a wide range of business tasks and are not unique to fundraising analytics.

10 Top Obstacles to Successfully Leveraging Analytics % 56.7% % 37.1% % 27.8% Staff resources Time (competing priorities) Data integrity Skillset missing Adoption Content of data Cost Buy-in One noteworthy trend is the divergence of buy in and adoption. Based on the past three years surveys, there appear to be fewer instances where buy in is an obstacle compared to the persistent nature of adoption as an obstacle to the successful implementation of analytics Obstacles to Buy-in Ease, but Adoption Remains an Issue Adoption Buy-in While fewer practitioners reporting buy in as an obstacle is certainly a positive sign, the fact that adoption persists signals the need for ongoing education of (and collaboration with) non technical staff as well as the importance of quantifying the value presented through each analytics project.

11 Survey responses also point to a relationship between the use of in house versus external analytics providers and whether or not adoption was reported as an obstacle. Respondents from organizations with in house analytics staff and had utilized an external analytics provider were much less likely to report adoption as an obstacle. Only 8% of respondents using both in house and external analytics resources reported adoption as an obstacle, compared with 6 of respondents who had in house analytics resources only. It appears that partnering with an external analytics provider can help alleviate one of the most persistent obstacles to successful analytics implementation. Is Adoption an Obstacle to Advancing Analytics at Your Institution? No In-House Staff, have used an External Provider 32% In-House Staff, no External Provider 6 In-House Staff AND External Provider 8% Conclusion Fundraising analytics continues to move from a niche segment to an integral component of all fundraising programs, and analytics practitioners serve as hubs of data sharing and insight to an unprecedented degree. This year s survey results indicate a growing need for thoughtful analyses and skilled analysts, as well as the value of a comprehensive analytics program that integrates with the entire fundraising program, providing insights for all levels of the organization. As the role of fundraising analytics expands in breadth and scope across our industry, so does the opportunity presented to our organizations missions. We can continue to unlock the value of analytics through our collaboration with our fundraising colleagues, by utilizing new and innovative data sources, and through some creative balancing of our various competing priorities :ACS:jub,