Lessons of Open Source CRM Applications from the Nonprofit World

Few industry segments have embraced CRM applications in the way that charities have. Nonprofit organizations were among the first to automate customer relationship management (often called DRM, or donor relationship management systems).

With a head start on integrating advanced technology into their operations, nonprofits can actually teach for-profit corporations a few things about using CRM software to build loyalty. Cynthia Edwards posted a few of her own top tips from charities using CRM applications:

• Keep donors (customers) supplied with rich content that adds meaning to their lives. Strong storytelling reinforces your position in a customer's life. From a practical perspective, it also makes sure that they will open your e-mail.
• Use e-mail as a personalized orientation to kick start new relationships. The few moments after a new customer has completed a form or made a purchase represent the biggest chance to make a lasting impact.
• Offer strong incentives to share personal information. A relationship can't start until a prospect takes the step of signing up for a newsletter, creating a comment profile, or making a donation (or purchase).

Likewise, non-profits have had more time to deal with the relative explosion of CRM application vendors vying for their business. Common suggestions include:

• Learn the difference between "free CRM software" and "open source CRM software." Budget-conscious charities gravitate toward free or cheap solutions. However, many "free" CRM applications require setup and ongoing maintenance from expensive consultants or vendors.
• Emphasize the need to track referrals and personal relationships when selecting CRM software. Donors often recommend each other, as do customers. Rewarding those introductions plays a pivotal role in developing trust.

Finally, long-time advocates of CRM software in the nonprofit sector often like to remind their for-profit cousins that being not-for-profit doesn't always mean that they don't know how to grow revenue. They simply reinvest it more quickly, directly into mission-based activities, instead of distributing profit to shareholders. Smart marketers can learn a lot from experienced non-profit relationship experts.