For the last few years I have written about the “new” generic CRM systems (e.g. Microsoft CRM, Salesforce etc) and their potential as a fundraising database for charities. Now, for the first time, I feel these systems have far more potential to challenge the dedicated (“traditional”) fundraising packages in the domain of fundraising and membership.
Which for charities means new and very exciting possibilities, and at the very least, a chance to compare such options so that you can determine which is best for you.
I thought it would therefore be a useful time to review the impact which these systems are having on the fundraising software market in a bit more depth. So I have written a 5 part series on these systems which will cover the following:
1) An overview on where we are now with such systems [This post!];
2) A guide to the different ways in which you can implement the systems;
3) How do costs and implementation timescales compare with dedicated fundraising databases?
4) What you should specifically consider if you are considering buying such a system;
5) Some examples of where you can go to buy the various options.
Just for clarification: by “new (generic) CRM systems”, I am referring to the likes of Salesforce, Microsoft CRM, SugarCRM etc; although of course, some of these are not so “new” now (e.g. Salesforce was launched back in 2000). And for comparison, when I refer to “dedicated (traditional) fundraising packages”, I am referring to companies such as Blackbaud, ThankQ, IRIS, ASI Europe, Redbourn and so on – and many more of course. Although interestingly, some of the “traditional” fundraising package suppliers have already released web-based and more CRM-oriented solutions. So as much as I am making distinctions in these posts, there will always be a cross-over between the two areas.
NB: I actually wrote this series of articles before last week's announcement that Blackbaud had bought Convio. I have decided to leave the heart of my posts 'as is' because the heart of all this information is product-agnostic. But what Blackbaud's purchase does show is that even they now recognise the benefits charities can get from a platform such as Salesforce. And that really says something.
A brief history of how we got here…
When Salesforce, Microsoft CRM Dynamics et al were first launched they were primarily aimed at sales and general customer relationship management. But very quickly, charities and other industries realised that they could apply the system structures to their own needs, and many NFPs started to use the systems for non-fundraising applications. However, fundraising has its own, more in-depth and specific requirements and I have written previously how I felt the dedicated fundraising packages still had the edge over the generic CRM systems.
But over the last few years, several factors have combined which mean fundraising is a more viable application for these CRM systems: this includes fundamental technology improvements such as faster, more reliable, more available broadband, and an understanding amongst charities that security and data issues on the internet are now a basic concept and perfectly acceptable to all; through to significant improvements in the web-based technology/platforms on which the systems are based and, therefore, enhanced functionality within the systems themselves; which has partly lead to and culminated in business developments such as a number of third-party suppliers taking the vanilla versions of such systems and creating “templates” which have some built-in functionality for fundraising and membership.
All of which adds up to the situation where I think these generic CRM system are for the first time now able to start to challenge the dedicated fundraising packages.
Of course, there are still issues with the generic CRM systems (as there are with the fundraising packages!) but the potential and flexibility which they offer, and the technological platform on which they sit (i.e. the cloud) is now starting to be matched with the fundraising functionality required by charities.
Which means that when I now run procurement projects, I can sometimes recommend that charities should compare all these systems; i.e. the dedicated fundraising package and the new, generic CRM systems.
It is an exciting time for not-for-profit organisations with database technology needs!
What are the potential benefits of the generic CRM systems?
I have listed below my thoughts on the pros and cons of these systems. But a few words first: please do bear in mind that all the points are my personal thoughts and beliefs and based on my experience. I am sure that many people could argue for or against all the points I list below – and indeed I would encourage that in the Comments for this post! But I have tried to be as fair and independent as I can possibly be.
- Flexibility: With generic CRM systems, you can get a solution where the heart of it has fundamental contact management and associated functions such as querying, reporting etc, and which is thus upgraded with new versions over the years, but which also offers you the ability to add bespoke or customised areas for your charity-oriented requirements.
- Some such systems now have “templated” charity options. Because the heart of the contact/customer relationship management is already in these systems (and much is standard regardless of industry sector), some commercial companies have taken these ‘vanilla’ CRM systems and added charity functions such as Gift Aid, membership, income batching etc. They can thus concentrate on adding value and specifics and can in theory build new applications far quicker. So you get a head start on your specific needs.
- Third-party app market. On top of the templates, there are thousands of third-party applications and programs which you can buy which add an incredible breadth of functionality.
- A different sort of future-proofing: You have the flexibility of using different support companies. Most such CRM systems are sold through re-sellers, so that even if you purchase and start with one such company, if you fall out with them or they go bust, there should be many others which can still support you. Quite a benefit. Additionally, most such systems will have a far wider customer base than any charity supplier. The more popular CRM systems have (high) tens of thousands of organisations using their systems (not all not-for-profit, of course). Even the largest charity suppliers will not beat such numbers. In theory, therefore, you will have a better chance of longevity, support, a robust system etc. It also means a wider user community who can help you, who may develop specific requirements, arrange user group meetings etc.
- They are often good for organisation-wide databases. If you have requirements which stretch past ‘just fundraising’ or ‘just volunteers’ etc, and/or your requirements in those areas are not overly-sophisticated, then these CRM systems can be very appropriate as they will offer good, general functionality and you may not have to customise the database too much.
- The potential of The Cloud. Salesforce is only available in the cloud, and MS CRM is now available as an on-premise or cloud-based solution with the same functionality, so you have all the potential of the benefits you can get from using the cloud. I have written before about such benefits and also what I think you need to consider the issues might be, so read my Should I Use The Cloud for my Charity's CRM blog from last year.
- Non-fundraising functionality. The vanilla versions of all these systems will not have specific fundraising-oriented functionality, especially on the income side; e.g. Gift Aid, direct debit processing, payroll giving. This can be extremely time-consuming and costly, depending on the needs, and/or not at all easy. However, some of the “templated” versions of these systems are now introducing such functions and/or there are third-party apps which you might be able to use. But...
- Even templated versions are just a starting point. You may still need to develop them further for your needs, which will cost and take time, and they may cost more in the first place to pay for the specific supplier’s initial outlay in developing such functionality.
- Suppliers (re-sellers) may not have such good charity/fundraising knowledge as fundraising package suppliers. This can be key to a good development of these generic CRM systems. If the supplier doesn’t know your market so well, then even if they perform a good “requirements analysis” phase with you, they may still miss issues or good options because they haven’t got the previous experience, and if your users don’t ask for such specifics, then you may not get such a streamlined solution as you could get from package suppliers.
- In-house Fundraising and Technology knowledge. Do you have someone who knows fundraising and technology at your charity? If not, then you will be fully reliant on the supplier or developer of your CRM system. For any significant implementations of generic CRM systems, I would recommend having someone in your team who has such skills and knowledge. (I will expand on this point in part two of my series).
- Are you re-inventing the wheel? Why do it if your requirements are specific to your sector or very simple? (Of course, there are good reasons to still consider CRM systems but do ask the question).
- Fewer fundraising users. Although there is no doubt that some of these systems really are growing in charity usage, the larger and more popular charity-specific packages will currently still have more nonprofit organisations using their databases. This means that for these generic CRM systems, you won’t necessarily have the benefit from either the other charities or the suppliers’ previous experience and requests for functionality and benefits.
- Risk. It can be a higher risk strategy to attempt to implement such systems for fundraising than dedicated packages. Perhaps not so much for smaller organisations or those with simpler requirements, but to replicate fundraising/membership functionality from packages will be a longer, riskier project. Again, the templated versions may offer some mitigation against this but they are still maturing.
I have deliberately left out from the above list two of the most key questions: how long will it take to implement the systems? And how does cost compare?