By Tom Peterson
Not too long ago many nonprofits looked askance at the idea of marketing. In the mid-nineties, an organization I worked with was raising about $3 million a year from what we would today call marketing. Some colleagues—particularly Michael Cervino, who had helped grow Habitat for Humanity—and I had created a marketing plan, based on the results we already had from direct mail tests. It mapped how we could grow the annual revenue to $20 million in five years. I was excited to share this good news with the board of directors. I walked them through the plan step by step, starting with the results of our testing and the early growth. I then waited for their enthusiastic response.
Nope, the enthusiasm wasn’t going to happen. As someone in the room said later, had you seen their reaction you’d have thought I’d just pissed on the table! First, they didn’t like the word marketing. It was not politically correct. Marketing was what immoral corporations did to manipulate unsuspecting people into buying things they didn’t need. Second, they’d gotten behind previous leaders give this kind of revenue growth talk, but it didn’t work. Finally, there was almost no business experience, much less marketing, on the board at that time. They couldn’t recognize that this plan was based on data from testing and research.
I suppose I did a poor job of messaging that day, I certainly didn’t know my audience well enough. It never occurred to me that the board would have any reason to object to growth. After all, the program in the field worked great, helping people overcome hunger and poverty. But we never had enough money. Eventually, we kept at the marketing and they came around. We wildly surpassed the numbers set out in that plan and kept growing for many years, becoming one of the fastest growing nonprofits. Fifteen years later we had grown that marketing revenue from $3 million to $90 million a year and had created a brand that had buzz and was loved and supported by millions of donors.
That was in the mid-nineties. Today many nonprofits turn to marketing for growth and use the approaches that businesses have developed over time, including direct mail, online marketing, branding, special campaigns and public relations.
Marketing Mix: The Four P’s
Nonprofits and causes often begin with the support of friends and family of those who had the original idea. But at some point, it becomes clear that the opportunity is greater than this original group can handle. So, they turn to marketing to raise more funds, get more supporters, more volunteers, to extend the program.
And one of the starting points is the “Four P’s of Marketing.” Business people have used this framework since the 1940s to design marketing programs, this “marketing mix” is blended to achieve the desired objectives from the target market. The goal is to put the right product, in the right place, at the right priceat the right time!
Product. This can be tangible like a car, a pencil, or spinach. Or it could be a service: a tourist experience, data search, dry cleaning. The brand comes in here, the appearance and packaging. How the product is presented to the public. How is your product different? Is it innovative, unique? What need does it satisfy? How is it designed, how easy to use?
Price. What does the customer or client pay? List price, discounts, pricing strategy, buying options. What is your market share? What’s the profit per unit? What does your product or service cost your organization to deliver?
Place. Where can the product or service be bought? In stores, online, on television, airports, street corners? What are the issues around distribution, inventory, warehousing, processing, transportation, and so on.
Promotion. What is the messaging to the buyers or donors? To clients? How do advertising, media, PR, personal selling play in the programs? How are target audiences told about product?TV, radio, social media, print, in person?
Of course, the temptation was too great, so folks quickly added to the original four P’s such tools as people: customer experience and other human aspects; process: how customers and business interact; physical evidence: buildings as the places of interaction, ambiance, packaging and all artifacts; policy: what rules and regulations impact your products or services?
Mix and mingle these elements with each other to offer different approaches to growing your cause. This 4-P (or 5- or 7-P) framework sets the stage for further questions: How are you going to get your message and call to action to your target audience? Which channels will be most effective? To reach your audience should you start with an email or a billboard? Over time mix whatever data you can get with creativity and testing to hone marketing programs that work.