Nonprofit Market Research: What? How? And most importantly, WHY?

June 5, 2019
Posted In Strategy

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Guest blog post submitted by: Bloom Communications, a leading communications consulting agency in the social good sector

Ok, so you saw the title above and you’re wondering, “Yes. What the heck is market research for nonprofits, and why on earth should they worry about it? Shouldn’t they focus on raising awareness to advance their mission… or securing donations… or gathering volunteers… or really, ANYTHING else?”

Yes. A resounding YES! These concerns should be central goals for your nonprofit. And all of these (very worthy) goals are going to be more attainable and have higher success with market research. Market research lets you gain the information you need (yes, need!) in order to effectively communicate with your audience in a way that will get them to take the action you want.

The Meaning and Purpose Behind Nonprofit Market Research

Before we go any further — what exactly IS market research? Here’s the definition: it’s the process of collecting, analyzing, and interpreting information for the purpose of gathering information. That sounds a bit redundant, right? It’s true that the idea behind market research is pretty simple: it’s all about using the information that’s presently available for the purpose of informing what’s to come. Research methodologies can get complicated, but this overarching objective never changes.

The problem is that most nonprofits’ understanding of the perceptions, motivations, and attitudes of their audience tend to be vague or based on assumptions — not facts.

This is understandable due to nonprofits’ many priorities that are competing for limited resources. But in order to know what your audience wants, you have to ASK THEM. Wouldn’t you love to know…

  • How your donors really feel about your nonprofit?
  • What motivated them to make their first donation?
  • What would cause them to give more?
  • How your nonprofit stacks up against competitors and like-minded organizations in the minds of your audience?
  • If your volunteers and advocates are satisfied with the way you currently communicate with them? If there’s room for improvement?
  • If the messages you use resonate… or leave your audience confused, underwhelmed, or even with a negative impression of your nonprofit?

All of this information will allow you to:

  • Garner better engagement with your current audience. The more your audience likes you, the more time and energy they’ll give you.
  • Identify and attract a stream of newcomers. With a solid sense of your target audience, you can build communications plans that will bring them in.
  • Reform operational inefficiencies that are stopping your nonprofit from reaching its full potential. When you’re in the trenches of something, it can be difficult to see where change needs to happen. Research uncovers the holes in your organization that need fixing, so you can maximize resources and impact.

Market research may not be the thing that most nonprofits initially think to invest resources in, but the informed strategies resulting from it will pay dividends for years to come. We believe that when you see the real results that research-backed plans produce, you’ll quickly become an advocate, too.

Before You Go Full-Speed Ahead

Now that you’re convinced your organization needs market research, we’re going to walk you through the various methods out there for obtaining information as well as explore which methods are best suited for getting that information. And with that, we need to hit the pause button.

What exactly IS the information you want to gain?

Before you dive into any actual research, it’s crucial to take a step back and consider where your organization is currently and where you want it to be. Ask yourself these questions:

  • What are your goals as an organization, from both a mission-driven and operational perspective?
  • What do you do really well, and where would you like to improve?
  • What do you know about your current audience?
  • What would you like to know? What audiences would you like to reach that you aren’t currently, or at least not as effectively as you would like?
  • Under what assumptions is your organization currently operating? Where would you like to test your hypotheses against actual research?

Answer these questions to create research goals and objectives that can be mapped back to throughout the research process to ensure you’re staying focused. Trust us, it’s easy to try to accomplish too much in a research effort; objectives will give you guideposts to keep you on track.

Your Audience

Next up is audience(s) selection. Who do you need to talk to gain the information you need to reach your research objectives? Maybe that audience is your corporate donors. Maybe it’s your board members. Maybe it’s those you serve. Maybe it’s a combination of the three.

Once you’ve figured out who you’d like to hear from, consider their likelihood to participate in your research. There are several factors that come into play here.

  • Proximity. Is your audience physically close to your nonprofit, or are they remote? Those located close by may be willing to come in for an in-depth interview, but for those located farther away, an online survey may be easier.
  • Profile. How would your audience’s time best be spent? Those with many responsibilities are probably unlikely to take a survey, but may be willing to take a 30-minute phone call.
  • Relevance. Always critically examine the audiences you’re considering against the research objectives you’ve set. Will this audience produce the information you need to know?

Determining the actual likelihood to participate will prepare you for the next step — research methodology selection.

Types of Research

Objectives? Check. Audience(s)? Check. Now, you can begin planning out your research methodology. Lucky for you, we’ve compiled a list of the various methods at your disposal here.

All research falls under one of two types:

Quantitative research. Quantitative research generates numerical, measurable data that can be transformed into usable statistics. It is used to collect general results from a larger sample population, and it allows the researcher to spot patterns and form hypotheses for further exploration. Common quantitative research methods include surveys (telephone, on-site, and online) as well as intercept interviews.

Qualitative research. Qualitative research is designed for the purpose of diving deeper. It’s for exploring the “why.” Methods are less structured than quantitative research; qualitative research is used to gain an understanding of underlying reasons, opinions, and motivations.

Common qualitative research methods include focus groups, in-depth interviews, and participant observation.

Question Set Creation

Your audience(s) are chosen. Now… what do you want to ask them?

Consider the objectives you created at the beginning of your research journey and make sure all questions track back to those goals. Curiosity is awesome, but in the context of market research, merely interesting information isn’t worth your while because it’s not actionable. Ask yourself: Is this information important for reaching our objectives? Or is it just nice/fun/interesting to know?

Also, pay careful attention to the way you word your questions or queries to avoid leading questions that may trigger skewed responses. Genuine attitudes and opinions are crucially important for gathering insights that you can actually apply.

Let’s take the example of an online survey.

Leading Survey Question: Do you agree that our restaurant is the best in town?

  • Yes
  • No

Including “Do you agree?” makes this a leading question, and “best in town” sways the thoughts of the survey-taker in a positive direction.

Not Leading Survey Question: How likely is it that you would recommend our restaurant to a friend or colleague? (1-10 scale)

This question allows the survey-taker to give their honest answer without being swayed one way or the other.

Creating neutral questions is very important, but for beginners, it’s not necessarily an intuitive process. Thankfully, there are plenty of resources online that can teach you how to design non-leading questions that will still gather the (unbiased) information you desire. It’s also helpful (and recommended) to test your question set(s) with a co-worker or friend to ensure they are logical and not leading.

Question set(s) in hand, you can go forth and get your hands dirty with some research! We’ll be waiting here with a margarita for you when you get back.

And Now…

Congratulations. You’ve completed your research. Pat yourself on the back. Drink your margarita. That’s tough work!

But your job isn’t over yet. Now comes the true star of the research show… reporting and analysis. All that data you’ve collected will be for nothing if it simply sits untouched in a folder on your computer. You’ve got to comb through it, identify patterns that uncover insights, and craft solid strategies for using the information moving forward.

Now you may be saying, “Hold up. What is an “insight”?

Glad you asked. Insights = discoveries that lead to actionable next steps. They are the “golden nuggets” of your research. Here are a few examples of how insights can be made actionable…

INSIGHT: Your audience says they would prefer to be communicated with via text message instead of the emails you currently send.

ACTION: Set up a service that allows you to send text updates to your audience moving forward, and reconsider how to utilize email marketing in a way that better resonates.

INSIGHT: When asked to define your nonprofit’s mission, your audience gives an answer that is contradictory to what your nonprofit wants to convey.

ACTION: Create a document that clearly defines the messages and positioning of your nonprofit, for use in all communications efforts.

INSIGHT: Board members are frustrated with your nonprofit’s lack of larger presence in the community, and it’s causing them to lose interest instead of being the strong organizational advocates you need them to be.

ACTION: Create a strategy focused on community engagement, positive image-building, and relationship management.

If you’re thinking this doesn’t look easy… you’re right! Compiling insights, creating actionable strategies, and assigning roles to implement those strategies takes a lot of work. But it’s absolutely worth it. This is the reason for your research.

Without this step, you’ll never be able to apply your findings. And you’ll always be left wondering if things are working and if you’re making the right decisions. Trust us, that’s not a place where you want your nonprofit to be!

Next Steps for Nonprofit Market Research

After six months of implementing the actionable strategies you created, revisit your initial research findings. Have things changed since you laid out your initial next steps? You may need to adjust strategies based on a new organizational objective or shift in priorities.

Additionally, measure the effectiveness of the strategies implemented. What’s working well, and what could be improved?

Continue to test and refine based on the results you see and do this throughout the life cycle of your nonprofit.

Take market research (and the process outlined here) seriously. If you do, we’d be willing to bet that your nonprofit will reach — and maybe exceed — the success you’re after.

Let team DNL help you implement and configure your next Blackbaud fundraising software.

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