Giving Opportunities

Will a Wealth Screening Really Help Me?

by Julia Bojarcik

Yes! Wealth screenings really can help you raise larger gifts and even identify major and transformative donor prospects. When you are looking to find qualified major gift prospects in your database, want to segment your donor database for targeted asks, or want to realign your fundraisers’ portfolios for optimum performance it can seem daunting — especially if your database has thousands of records. It isn’t a magic bullet, but a wealth screening can take you pretty far, even in this age of A.I.

What is a Wealth Screening?

Wealth screenings provide information about philanthropy and wealth markers that are matched to individuals from public data. When you submit the names, addresses, and any additional data to the wealth screening vendor, the vendor then takes that information and matches it with external data, and creates numerical or alpha ratings for wealth and/or inclination for each record. The ratings can be sorted and segmented, which is useful in developing fundraising strategies.

If your database or CRM has the capability, the ratings can be uploaded to your system for additional segmenting and reporting. Depending on the vendor used, you may receive additional data points such as property values, stock holdings, family foundations, and giving to other charitable organizations.

Why do a wealth screening?

Wealth screenings enable you to look at your donor database in a new light and highlight donor prospects who have the potential to make larger gifts. Below are a few examples:

  • Easily segment donor database by wealth and philanthropy: Donor prospects can be prioritized based on wealth scores, enabling your gift officers to focus their time and energy on those that have potential instead of cultivating prospects with little or no potential or inclination to give to your organization. Conversely, donor prospects with lower wealth scores can be reevaluated for possible removal from portfolios. If you are planning for a capital campaign, a wealth screening can help you build your campaign gift table.
  • Find ‘hidden gems’ in your database: Maybe you have a donor who gives very little or gives sporadically to your organization. That type of donor may not be on your radar. But when a screening indicates that he owns multiple properties in wealthy neighborhoods or runs a multimillion-dollar business, you may just have found a winner!
  • Create tailored lists for your fundraising events or visits: Say for example, you are planning a major fundraising event in Naples, Florida and want to invite your most promising prospects from that area. Where to start? You could pull a list of Naple prospects based solely on giving to your organization. But what about people who made small gifts or haven’t given recently? Should they automatically be discounted? Maybe not! Considering wealth capacity scores along with giving may highlight untapped potential donors in your database, thus creating a stronger invitation list.
  • Create Strategic Direct Mail Appeals: Direct mail appeals are expensive, especially if mailing to your entire database. Plus, the return on investment (ROI) can be low. Screening data can help your organization be more efficient and cost effective by segmenting your database by wealth and inclination. Therefore, instead of mailing to everyone in your database, you can strategically segment your donor database to create targeted appeals. This strategy will reduce the cost of direct mail appeals and increase your ROI.  
  • Opportunities to upgrade donor annual giving: Wealth screening vendors often provide an estimated annual gift range, which indicates the amount a donor is likely to give to your organization in one year. By comparing that data, you can find opportunities to upgrade donors to a higher gift amount through targeted appeals. This strategic approach is another way to reduce costs and increase ROI for direct mail appeals.

Wealth Screening Limitations

Wealth screenings sound like a magic bullet, don’t they? However, like any technology, they have limitations.

  • Garbage in, Garbage out: Screening data is matched to individuals based on the names and addresses from your database. The cleaner your data, the better the results. This is a good incentive to get your data in top notch shape!
  • False Matches: Even with the best data, there may be errors. There is always the possibility of false matches. This is especially true with common names. Say you happen to have two John Smiths who live in the same large city. It is conceivable that the screening could have matched data to the wrong John Smith. Another example along those same lines would be in the case of a father and son who are a Senior and Junior. And if there is a III or a IV, the chances of that happening increase. A good practice is to validate the results, especially in the case of common names.
  • Overestimating Wealth:  Screenings look at visible wealth, such as property values, business ownership and stock holdings, to determine the ratings. But there are some caveats to be aware of. Screenings tend to overestimate the wealth of those in the lower wealth tiers since most of their visible wealth is the value of their home. However, donors are not likely to sell their home to make a major gift.
  • Underestimating Wealth: Conversely, screenings tend to underestimate the wealth of those in the higher wealth tiers since their wealth can be tied to LLCs, trusts, and other non-public assets that cannot be found by screenings. People in the middle wealth tiers can have more visible assets such as multiple properties, insider stock, and evidence of larger gifts. Wealth screenings tend to be the best and most accurate with this group. Something to keep in mind as you review the results.

Since screening results have raw, unverified data, the results can be subject to error. The scores are great for segmentation. However, when looking at individuals the results should be validated for the reasons mentioned above.

It is also important to remember that to make use of all that wonderful data, it must be incorporated into your overall fundraising strategy. Too often organizations let that data sit there unused, due to either staffing or scheduling issues, or they just don’t know what steps to take.  Screenings are an investment in your program. Don’t let that happen!

Beyond the Wealth Screening

Wealth screenings are one piece of the fundraising puzzle. They are a fast and economical way to sort and segment large files. They are a way to prioritize prospects and help create strategic fundraising efforts, thus saving you time, money, and energy.

However, the ratings don’t tell the ‘story.’ This is where Profile Research plays an important role. Prospect Profiles can often uncover the story behind the donor prospect. Was their wealth made or inherited? How do they view philanthropy? What types of organizations do they tend to support? Are they more likely to respond to an emotional need or to a ‘good return of their investment’? These insights paint a more complete picture of the donor prospect which is vital in tailoring a cultivation strategy for a specific prospect.

Wealth screenings are only the beginning of a solid fundraising strategy. Remember that the key to securing very large gifts is building strong relationships with your donor prospects, and that takes time.

Are you considering a wealth screening and wish you had a research partner you could count on? Schedule your free consultation with Aspire today!

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