Part 1: Marketing for the Nonprofit Organization – Introduction

Set Marketing Goals

Setting goals is the first step in the marketing process because goals provide direction for your total marketing effort. It is important early on to be as clear as possible about what you want to accomplish. Your goals tell you what success will look like and help you focus your attention in order to achieve it.

There are two main kinds of marketing goals: action goals and image goals.

With action goals, you want your marketing efforts to produce specific, measurable results for your organization. Action goals relate to things you can count. They are quantitative. Nonprofits can count the number of people who attend an event or sign up for a program, or new members gained in the annual campaign.

For example: Image goals involve establishing or changing the way your organization is perceived. If you are just starting up, adding a new program, suffering from an outdated image, or evolving as an organization, you will want to set image goals.

For example:

A clean-water group wants to be seen as a leading regional advocate on environmental affairs. A community center wants to update its image to reflect a broader range of family services. A medium-sized but relatively unknown arts museum wants to be a household name in the city that it serves.

The goals you set should strike a balance between what you ideally want to accomplish and what is possible. It’s important to set your sights high as well as respect down-to-earth limitations of time, resources, and outside factors beyond your control. The bottom line on marketing goals is to further your organization’s mission. Whether you are out to attract people, attract attention, raise funds, or raise a fuss, it’s all done to advance the cause.

Targeting Constituents

Before you can meet your goals, you must carefully analyze your constituents. There is no way to reach all consumers in a given market – at least not in the same way. A market is the set of all potential recipients of what your organization has to offer. Some organizations are in a better position to serve certain segments of the market. Thus, your organization must divide up the total market, choose the best segments and design strategies for serving chosen segments better than its competitors. This involves market segmentation, market targeting and market positioning.

Segmentation

The market consists of many types of customers, products, services, and needs and you need to determine which segments offer the best opportunity for achieving your organizational goals. Consumers (whether they be donors or service recipients) can be grouped and served in various ways based on geographic, demographic, psychographic and behavioral factors. This grouping is called market segmentation.

A market segment consists of consumers who respond in a similar way to a given set of marketing efforts. For example, one segment of symphony-goers attend concerts because it is the thing to do in their certain social group – even if they don’t really appreciate the music. Another segment goes to concerts because they truly love the music – they may even be musicians themselves. Another segment has never attended a symphony before, but has the disposable income to afford season tickets. It would be difficult to develop one marketing message for these three distinct segments. Organizations are wise to focus their efforts on meeting the distinct needs of one or more market segments.

Targeting

Market targeting involves evaluating each market segment’s attractiveness and selecting one or more segments to enter. An organization should target segments in which it can generate the greatest customer value and sustain it over time. An organization with limited resources might decide to serve only one or a few special segments. Or, an organization might choose to serve several related segments – perhaps those with different kinds of consumers but with the same basic wants. Or a larger organization might decide to offer a complete range of services and memberships to serve all market segments.

Most organizations enter a new market by serving a single segment, and if this proves successful, they add other segments. Large organizations eventually seek full market coverage. The leading organization normally has different services and products designed to meet the special needs of each segment.

Let’s take our example from above of two different orchestras. One is a newly formed philharmonic orchestra that will serve a statewide audience. Because they are just starting out, they will want to target segments already accustomed to symphony-going in order to generate revenue. This would be the folks that attend the symphony for social reasons as well as those who are genuine music lovers. It should not be difficult for them to appeal to patrons of the well-established, 30-year old state symphony orchestra. The new orchestra mimics the established symphony’s advertising. They also obtain a copy of the established symphony’s annual report so they can identify those people that contribute and target them as well.

The established orchestra, on the other hand, needs to broaden its constituent base and draw ‘fresh blood’ to their performances in order to grow. For the upcoming year, they decide to target people throughout the state who have disposable income, but have not attended concerts in the past or who are unfamiliar with classic music.

Once you have targeted one or more segments on which to focus, you should develop a complete profile of the type of person that comprises that segment. This will help with positioning and with developing your marketing message.

Positioning

Nonprofits compete against each other whether or not they are the same type. You are continually trying to get your organization to the top of your constituent’s contribution list. So, once you have decided which market segments to enter, you must decide what position you want to occupy in those segments. Your position is the place that you occupy relative to your competitors in your consumers’ mind. This is where you make your case as to why your organization deserves support over another. If an organization offers services or attractions exactly like another in the market, consumers would have no reason to support it.

Market positioning is arranging for an organization or its services to occupy a clear, distinctive, and desirable place in the minds of target consumers relative to competing organizations. Thus, you should plan positions that distinguish your organization from competitors, which gives you a strategic advantage.

For example, in order to appeal to the established, socialite and music aficionado crowd, the new Philharmonic chooses to create an overall look and feel for their marketing and program materials that is laden with columns, scrolls, and embossing. The orchestra plays more difficult and obscure works as well as a few more popular pieces. The orchestra wears the traditional black tie attire for their concerts, and they choose established, ornate halls in which to perform. Their ticket prices are slightly below those of the well-known symphony. The philharmonic’s motto becomes “The classics you have come to expect – for less.”

The older symphony takes a new approach to their positioning in order to reach out to the new segment they have targeted. They maintain their traditional programs, but also add popular pieces that are recognizable to the general public because they have been used in mainstream movies or advertising. They adopt a more casual appearance, allowing their orchestra members to wear less then black-tie attire. The women no longer wear only dresses and the men are not required to wear ties. They begin to play outdoor afternoon weekend concerts on local greens throughout the state. They also introduce lunchtime programs at large businesses throughout the state. In particular, they target the younger crowd of the high-tech sector. In an effort to increase awareness about classical music in general, the symphony buys advertising space on local rock stations and writes quippy and funky copy that appeals to a younger crowd. They do away with the gilt and upper crust image and adopt bold colors and modern art images that make them appear less conservative. Their new tag line becomes “The Symphony everyone can enjoy.”

In positioning yourself you first have to identify possible competitive advantages upon which to build this position. To do this, you must offer greater value to your chosen segments either through price, or quality. Whatever you offer, though, you have to deliver. Once you have chosen your desired position in the market, you should take strong steps to deliver and communicate that position to your target consumers. The entire marketing program should support your chosen positioning strategy.

*Part three of this series will discuss the marketing mix.

Heidi Kelley and Tara Mahady are marketing coordinators for Campagne Associates, which offers fundraising software solutions to assist nonprofit organizations in becoming more effective fundraisers. They can be reached at info@campagne.com.