Shifting towards marketing in nonprofit, an opportunity or a threat?

It’s not an easy job for us fundraisers to realize increasing incomes year after year. It becomes increasingly difficult to grow in a competitive market that even is consolidating (for private donations  http://www.geveninnederland.nl/). A strong fundraising plan in itself is not sufficient anymore. We need to develop a more integrated approach. Strategic marketing planning should be added to your fundraising efforts and thereby considering the following questions:

• How do you position yourselves against competition to be successful
• What will you do to seduce the ever more demanding donors to support our goals with a gift
• How do we get more grip on and understanding of our donors whose donation patterns change considerably

In order to address these issues we need focus and make clear strategic choices before we start making our yearly fundraising plans (the numbers in € ‘s). In other words, what will be  your marketing  strategy to win the ‘battle’ for the donor?

Marketing in the nonprofit, there are supporters and opponents of introducing marketing in charities, some see opportunities, others threats.  I strongly believe that marketing orientation is crucial in achieving your mission, in other words “no marketing, no mission”!

Focusing on the customer as a competitive strategy requires marketing orientation
A model that helps to make strategic choices is that of Tracy and Wiersema. It forces you to choose between three perspectives:  Productleadership (best product), Operational  Excellence (best price) or Customer Intimacy (put the customer first).  The Dutch Heart Foundation has also decided to  change towards  a customer-driven organization. The position of Marketing Manager was created in order to accelerate this organizational change and to strengthen the marketing perspective within the organization.
I would like to share with you some lessons learned from my first experience as Marketing Manager in the non-profit. Some of you might think ‘what else is new’ but for others (as for me) these experiences can be considered the first small steps towards a customer focused organization.

Marketing in the non-profit; quite complicated in our day to day practice
There are many definitions of Marketing. For me, marketing means the matching of supply and demand in a given market while adding value. Marketers do not think in terms of ‘supply’, or how do I sell my products on the market. A marketer looks through the eyes of his customer. Of course our fundraisers are already used to think from a customer’s perspective. But in the end fundraisers are held responsible for sales targets (income), instead of marketing targets (at least in my organization). And how about the other disciplines of the organization? To what extent does all staff have developed the appropriate marketing mindset? This brings me to the first dilemma.

1st Dilemma: how to close the gap between marketers and non-marketers?
One may talk enthusiastically about our profession and the benefits of marketing for the organization. However, conflicts may arise, for example due to a perceived knowledge gap or cultural mismatches. The word “customer” creates a lot of confusion. The term “Marketing” as well.
Respond to create a common conceptual framework. Choose words clear to everyone, including non-marketers (and there are many) creating positive vibes. For example, use terms like:

• “Relationship” instead of customer; since everybody wants relationships with others (as opposed to win customers …)
• “An interested potential customer” instead of  “Lead” (I have to explain the word lead over and over again)
• “Create relationships” instead of “conversion of Leads”

So no jargon and technical terms, make the marketing discipline accessible and down to earth. Also realize that the introduction of a new mindset is not only a matter of logic and persuasion, but also a political exercise. Moreover, it is important to others to see and feel the benefit of the marketing orientation. Which brings me to the second dilemma.

2nd Dilemma: how do you ensure that marketing adds value to your nonprofit organization
Marketing in the nonprofit sector is often considered as a promotion tool by individuals who supply an organization’s funding (acquisition)  in order to build a better image, win more customers, to recruit volunteers and to increase loyalty. “Thanks very much but what’s in it for me?” I often hear from colleagues who will derive the primary benefit therefrom (allocation of budget).
Choose a simple model by which you can incorporate the marketing aspects into the business of your colleagues who work for the big cause, your mission. So staff better understand what marketing can do for them, they will learn the benefit from a marketing approach because it will help them to better realize their goals.

Involve your colleagues using a simple marketing model
I like to use the 4B’s model of Marketing Services by Wouter de Vries (sorry guys, no translation available at:http://www.dienstenmarketing.nl/daten/start.html). It is an accessible model enabling your colleagues to develop a marketing perspective (outside-in) while developing their programs and plans (which sometimes happens especially inside-out).
Develop activities that are based on the needs and wishes of your target audience. With an attractive proposition or promise you’ll attract more people. If your marketing cycle is consistently applied in each step, you will achieve more effective and more successful programs (Evidence).

3th Dilemma: building an intimate relationship with the customer! But are we clear on who is the customer?
Does everyone in the organization has the customer in mind in everything he does? And if so, when you talk about ‘the customer’, does everybody has the same ‘customer’ in mind? Or could that be the ‘Scientist’ for one, the  ‘Patient’ for another and ‘the Donor’ for yet another? And if it were the donor. Do we spend our resources (marketing mix) to everyone i.e. any donor, or should we focus on a specific audience or a segment within this target audience. In other words, who do we consider to be our donor?

It is my experience that it is very important to discuss and address these questions throughout the organization. Make sure at the end of this discussion there is commitment about one single definition of the ‘customer’ and a clear picture of the different target audiences  and other stakeholders.

The two most important steps towards a customer-driven organization
After addressing a few dilemmas  as well as the cultural and knowledge barriers, we can elaborate on many typical topics in the field of marketing for nonprofit. For the moment I like to share 2 lessons learned with you:

1. It all starts with acquiring and using customer insights, in order to understand behavior
2. Ultimately you want to build a mutual beneficial relationship ensuring as much added value for your customer (and for you) as possible.

The customer as a starting point of all activities: from customer knowledge to customer insight
In the end our marketing strategy is designed to influence the behavior of our target audience; the behavior of giving, of promoting us to others, of being loyal to us. In order to do so, we need to really understand our donors. We all  talk a lot about the customer, or donor.  But do you actually know your donor that well?  Our database registers where they live, how much they give, how often. We also know how many and which other charities are supported by our donors and which newspapers they read. Donor panels and focus groups provide us with information about the reasons to give or reasons to leave us (in general).

But what does that really mean? And how does that knowledge help you to really understand the drivers for behavior of your (potential) donors. What do you really need to know and understand, in order to influence their behavior. What customer insights do you need to acquire?

These are the questions we are trying to find answers to at our organization. Through questioning during customer contact, customer visits and by conducting qualitative research.  How well do you know your donors?

From fundraising to friendraising by building mutual relationship
Now  we know and profoundly understand our donors, we need to build mutual and sustainable long term relationships with them. It is time to formulate and implement  a CRM vision. CRM:  for one  a software tool,  for others a business strategy. And there are believers and non-believers: does your donors actually want an relationship with your organization? Will we earn back our investments?

I didn’t get their yet, but I strongly believe that strategic  marketing plays an eminent role in achieving this ultimate goal. I dare to say “no marketing, no mission” and I’m very curious to learn from your experiences as marketers in nonprofit.