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A non-profit organization is used to depict an organization that exists to accomplish some other objectives than the usual objective profit return on investment or market share (Lamb, 167). In both cases, service business and non-profit organizations are involved in the marketing of services and regularly call for the customers to be there in the course of the production process. Both business and non-profit organization services vary widely from different producer and form time to time even from the same producer.
Marketing as regards non-profit organizations is the attempt made by non-profit organization to convey equally fulfilling interactions with the intended markets. Whereas, these organizations differ in complexity and function and operate in varying settings, majority perform some the following functions; recognizing customers they aspire to serve or attract but they regards them as clients, members or patients, stipulate their objectives openly, make a decision what to charge for but use such terms like rates, fees, donations, fare or tuition, plan events that establish where they will located be and where services will be given and communicate about their accessibility by use of brochures, announcements or publics. Frequently non-profit organizations involved in the above named functions do not become conscious they are involved in marketing (Lamb, 167).
Marketing in non-profit organizations
Marketing is unusual idea for majority of the non profit making organisations. Non-profit organisations are required to understand that marketing is more than just the old sense of selling or getting donations (Blythe, 54). In non -profit organisation, marketing is a means of fulfilling the desires of the consumer and donor. Among the steps a non-profit organisation should take in order to achieve it marketing goals include; identifying the organisations marketing targets facilitates the organisation to discover opportunities and explore them. The identification of marketing targets gives the organisation information required to concentrate on buyers that are interested in what the organisation is offering. Among the three prime areas a non-profit organisation should recognize while creating a marketing strategy include, market goals, communications target and buying target.
The target market is who the organisations marketing efforts are focused on. The target market is also the group which the organisation would like to sell its products or services to. This is a group who have an attention in what the organisation is offering. The target market of anon-profit organisation can be divided into segments which can include population, age groups or income levels.
The purchasing target of an organisation is used to depict the persons or businesses which are contained in the organisations target market and require the organisations products or services and can actually manage to pay for it. The method of informing the target customers of your products is the communication target (Blythe, 56). Communication target is also used to refer to the various methods or styles employed by the organisation to get to the identified target market.
In coming up with marking plans, marketing manager's of non-profit organizations must make many choices. These alternatives might include adjustments to programs, adverting, changes in public relations and collaboration with partners. Marketing managers normally make choices on those elements to which they have command of such as the amounts to be apportioned to marketing. These factors are known as convenient variables since they can be altered by the marketing manager. Under normal situations, many forces work outside the control of the marketing manager, such as new laws or environmental changes. These factors are regarded as uncontrollable variables. Managers involved inn marketing planning must make decisions about which controllable variables to control for them to accomplish organizational objectives.
Marketing orientation of non-profit organizations
A non-profit organization has a marketing focus if it depends on marketing strategies to accomplish its goals. A non-profit organization with a marketing focus employs the array of marketing tasks to gain funds and develop good relationships. When a non-profit is marketing focused, its different units and programs are coordinated to further the mission of the organization, achieve the goals of the organization and communicate a reliable and focussed message to clients , donors volunteers and target public. When all units of a non-profit organization work towards a familiar ambition, there is unity and focus and this result to higher success and steadiness eliminating lack of focus on the purpose. In addition, when all units of an organization are working in harmony and delivering a steady message outwardly, vital areas obtain a clear understanding of the organization's uniqueness and value. A marketing focus enables the non-profit focus outwardly and the staff will focus on their activities and their programs.
Non-profits mission statement. The mission statement of a non-profit organization should be short and very clear to the point and it should also outline the extent of the organization and should also be realistic, unique, appealing. In addition, a non-profit's mission statement is required to spell out three magnitudes of an organizations extent that include; the intended public who the organization intends to serve, the needs of the intended public and the technologies which the non-profit will employ to meet the needs of the publics. The feasibility aspect of a non-profit mission statement describes that it is required to really be capable of accomplishing its mission with the available resources. Furthermore, non-profit mission statement is required appealing to the staff of the organization and volunteers, motivating them by hard work and impediments that are likely to occur. Finally, a non-profits mission statement is required to be exclusive to the organizations it is defined for.
The general mission of a non-profit's and any future planned to the undertaking should be issues to be dealt with the management or directors of the organization. Mission statement should be not be prone to recurrent changes and should be drafted such that technological, market or environmental changes do not occasion for radical redefining. Change in a non-profit organizations mission statement should only be done if only required to preserve reliability and significance.
Strategic objectives to accomplish mission in non-profit organization
When managers of non-profit organizations are pressured to control resources, get fund s and develop programs to accomplish the mission like saving lives, reducing disability or distributing food. They are required to begin by conducting a strategic analysis of the market to have a clear understanding of what the market requires perceptions, morals and competitiveness. Form an in-depth result of market analysis, the mangers can then be capable of setting the main strategic objectives of the organization.
The strategic objectives of a non-profit organization declare the where the organization is focused towards. Strategic objectives need to be clearly stated with marketing and other goals at the lesser units of the organization. Strategic objectives should be drawn in a hierarchal order beginning with the most important to the least importance. The strategies should be equated in numerical values so that their accomplishment can be evaluated without bias. The strategies should also be practicable and dependable with light of the resources available.
After developing the organization strategic objectives, then each of the units within the organization should have its specific objectives defined to meet part of the organization objectives depending on its role and competence. The procedure should be repetitive at all levels of the organization, so that it bring into line personal goals to departmental goals and departmental goals to unit goals and finally unit goals matching with the whole organization goals (Wymer et al.,31).
Tactical marketing and planning in non-profit organizations
The top management teams of non-profit organizations as well as the board of directors are involved in making choices concerning the future direction, objectives and goals of the organization. This engagement is regarded to as strategic planning. Marketing strategies include such activities like, event organizing, marketing study, fund raising, public relations and advertising. A non-profit organization utilizes strategic marketing through coordinated and integrated use of marketing tactics to accomplish its objectives (Kolb, 87). A strategic marketing plan describes a comprehensive plan of marketing activities to be executed over a given period of time to facilitate a non-profit organization to accomplish its objectives and goals. Strategic marketing planning for a non-profit organization involves the practice of collecting information and creating procedures to develop the strategic plan of marketing.
Managers of majority of non-profit organizations in the past have not been engaging in strategic planning since they had not had formal training in business field or prior knowledge in that field. The other reason is because non-profit mangers normally start off the organization with a few employees and volunteers who are involved in doing much of the work in initiating the non-profit and non-profit managers believe they do not have time to commit in strategic analysis and planning (Wymer et al., 89).
Strategic analysis and planning is very vital for non-profit organizations since they are also concerned about effectiveness and efficiency in selection about spending their resources. With increased competition and requirements for responsibility, having a plan based on through analysis of market is a requirement. In addition, plans enable non-profit organizations to coordinate activities for a given period of time such that activities that need to be accomplished ahead of others are done on time (Wymer et al., 89). Plans facilitate non-profits to set timescales for their various projects and activities. Successful plans should not only be based on market analysis but should also be distributed all through the organization and when everyone has access to the written plan non-profit witness better communication all through. With plans which have in-depth strategic analysis assists in keeping non-profits concentrating on their mission, and preserving the reliability of their organization instead of swaying away due to short term goals.
Strategic marketing and analysis planning for non-profit
Need-focussed orientation analysis, in this step the strategists required to expose the effect of non-profits present situation. Information, regarding the level of need-focussed situation of non-profit organization can be gleaned by consultation with non-profit mangers, volunteers and employees or by reading past reports (Wymer et al., 101). Managers of non-profit organizations may also enlist the help of volunteers or board members who have knowledge in marketing to assist in the need-focused orientation analysis.
New product development process analysis; since majority of offers pass through lifecycles that can easily be predicted for growth to death stage. With a well planned new product development plan in place, a non-profit can predict and evaluate and work through the creation of the best products/ services or programs in addition to or substitute those close to decline. With a formal approach will ensure new concepts are given timely and suitable consideration and the role of coming up with new offers is defined.
Analysis of non-profit organization positioning; Since non-profit organizations compete with other organizations for grants, donations and tax monies employees and volunteers, understanding positioning of a non-profit is thus a vital tool for survival and growth. Analysts of non-profits organizations are bound to evaluate the present situation of the non-profit together with the position of its products, services or programs as seen by the current and prospective clients, donors and intended public (Wymer et al., 101). The main goal of positioning analysis is to provide a strategic explanation of what is displayed by perception maps.
Analysis of competitiveness of a non-profit organization; If a non-profit organization is not acquainted about each competitor, the search for relevant information will provide at least a bit of information and insight regarding the offers of competitors and activities that can have significance on the non-profits plans. When a market analyst gives out the findings of putting into practice a specific strategy, the no-profit will be able to gauge the real and intended competition response and its results.
Analysis of financial status for a non-profit organization; Effective strategic planning requires excellent financial analysis. Accounting for cash flows, margins, breakevens and donations present useful models for planning. Majority f non-profits have specialists in accounting and finance either on their board of directors who aid in financial analysis and the final assessment of choices.
Assessment of clients needs in non-profit organizations; Identifying what the clients needs are and where, when and how they can best be met is a vital task. Non-profits clients can be individuals who use the offers of the non-profit or they can be donors. Complex efforts to try to comprehend the needs of the non-profits client are the reason why clients of their own needs differing form expert's discernment. Apparently, non-profits have an ethical role for the result of the selection about the needs to serve and those not to serve.
Defining alternative strategies in non-profit organizations
Strategic alternatives are required to include the 4P's product, place, promotion and price. Every alternative strategy created needs to be the organization's best tactic to that strategic course. For instance, an alternative for health care offering non-profit may be to spread out their offer in another nation, or redefine its offer to include the target public in its country of foundation. Analysts need not to build up strategic alternatives that are similar except where they are for one area. All alternative strategies should be copied from the situational analysis.
Marketing mix for non-profit organisations
The marketing mix for non-profit organisations include four factors that are controllable which are, price, promotion, product and place, (Wymer, et al., 122). The four variables can also be joined to form market demand and enable dealings and that needs to be considered when it comes to achieving the public targets. The four factors that can be controlled are in most cases known as the 4 P's, the price depicts the financial or nonmonetary costs, and promotion depicts the marketing communication with the intended audience. By understanding that even non-profit organisations can control these variables, is vital in making choices about distribution of resources.
How to define the offer in non-profit organisations
According to, (Wymer et al., 123), an offer in a non-profit organisation is used to describe any combination of benefits in a product, service or social marketing program that can fulfil a need or a want of the target market of an organization. In non-profit organizations offers are not easy to recognize since they do not comprise of tangible products and are in most cases, social marketing programs or services. Product offers are often tangible i.e. can be felt or handled or non-perishable and can also be inventoried i.e. stored for future use. On the contrary, services are intangible, inseparable for the provider, perishable and in some cases they vary depending on the provider on their quality and cannot be stored for later use. Marketing of social program is in most cases difficult to define since they are not tangible, consumable, and in separable than services. Marketing of social programs is often a referred to as issues marketing, social ethics marketing or behavioural change marketing.
Matrix of a non-profit model
Though models were created for business organizations, non-profit managers still have make a decision the most suitable mix of offers to use. The Gomes/ Knowles Customer Value/Mission (CV/M) model facilitates managers of non-profit to analyze their offers in two extents that are directly related to the non-profit and truthfulness to the mission of the organization and the apparent customer value. The Customer Value/Mission model is utilized to address the needs of managers of non-profit organizations to accomplish non-monetary objectives inherent to their missions as well as be focused on the client by considering present and intended public discernment of the offers by the organization.
Social marketing programs marketers aim those programs to persuade attitudes regarding health, lifestyle or social behaviour and in due course the behaviour of their audiences. Thus, attitudes that are as a consequence of social marketing programs do not come into existence independently without the target public. Social marketing programs and services are in most cases difficult to describe since they are more undefined than tangible goods. For example, the offer for International Federation of Red Cross and Red Crescent Societies offers characterized disaster management programs, such as disaster management, disaster, preparedness, and response to disaster. In disaster preparedness program may encompass capacity evaluation, vulnerability and better programming initiatives. In addition, both disaster response and disaster management can encompass many subprograms of their own.
In marketing for a non-profit organization, the direct consumers of the product or service are known as the client publics while the indirect consumers are known as the general publics. For instance, the student body in a university form its client public while the trustees and the alumni form the general publics (Pride and Ferrel, 375). The client publics are given more attention when an organization creates a marketing strategy.
Creating a marketing mix for non-profit organizations.
A marketing mix strategy confines the choices and concentrates the marketing activities towards accomplishment of organizational objectives. The marketing strategy needs to encompass a plan for decision making regarding product, promotion, distribution and price. These decision factors need to be merged to serve the aimed market.
In coming up with the product, a non-profit an organization in most cases develops concepts and services. Hindrances, may crop up in case an organization fails to classify what it is offering. For instance, Peace Corps, offers vocational training services, health services, society development and nutritional assistance. It also markets concepts regarding international collaboration and execution of the foreign policy of United States. Therefore, Peace Corps, product is complicated to illustrate than common business products. The marketing of services which are intangible requires a more marketing endeavour (Pride and Ferrel, 375). Marketing of information and concepts similarly is more difficult than tangibles and much more effort is therefore required in order to gain any returns.
Decisions regarding distribution in non-profit organizations are associated to how ideas and services are to be made accessible to the customers. In case the product in offered is an idea, then the choice of the correct media to communicate the idea will fasten the process of distribution. By nature services, are comprised of assistance, availability and convenience. Accessibility is therefore part of the total service. Making a product such as health services accessible requires knowledge regarding retailing ideas such as the location of the health facility. Creating a distribution channel to manage and enable the movement of non-profit products to consumers is a vital role which requires the overhaul of the long-established idea of marketing channel. There is no incorporation of independent wholesalers, in non-profit marketing situations, since the product flow from non-profit organization to the client. The creation and utilization of ideas and services are in most cases instantaneous.
Creating promotional decisions might be the first indication that non-profit organization perform as marketing activities. Non-profit organizations utilize advertising and publicity to be in touch with public and customers. Direct mail remains the major method of raising funds for social services like those offered by Red Cross and Special Olympics. Environmental conservation focussed organizations usually face the obstacle in endorsement materials, on how to commune using environmental friendly materials like recycled paper and atmosphere sensitive inks. Progressively more, non-profits organizations have come to use the internet to access fundraising and promotional objectives by use of email, and soft ware that facilitate accepting internet gifts (Pride and Ferrel, 375).
Majority of non-profit organizations are also using personal selling, although using another name. Charity organizations and churches depend on personal selling when they send off volunteers to enlist new members and ask for for contributions. Special occasions to collect funds, offer services and communicate ideas are successful promotional activities. For instance, Amnesty International, held a global concert tours featuring renowned musicians to raise funds and create public awareness of political prisoners around the globe ( Pride and Ferrel, 375).
Even though, product promotional practices might need only slight adjustment when utilized to non-profit organizations, the pricing is differing and making of decision is complicated. Among the pricing concepts faced by a non-profit organization include pricing in user and donor markets. The two types of pricing methods utilized by non-profit organizations include, fixed and variable pricing. Under fixed pricing, there is a fixed fee for the users or the price might differ depending on the user's capability to pay. In a situation, where a donation seeking organization accepts any donation, then it's using variable pricing.
In developing marketing strategies for non-profit organizations the broadest description of price need to be used. The financial price or exact dollar value might not be charged in a non-profit item. Opportunity cost is the value of the foregone benefit by giving up one alternating and selecting another. Based on this traditional view of pricing non-profit organizations influences individuals to donate time towards a cause or change his or her behaviour are the paid by the individual. For instance, unpaid assistants who answer telephone calls for a university psychotherapy service or suicide hotline, give up their time which they could other wise have spent studying or doing other things and the income they forego from working in a for-profit organization (Pride and Ferrel, 376).
In other non-profit organizations, financial cost is a vital component of the marketing mix. Nowadays, non-profit organizations are raising capital by raising the costs of the services they offer, or have started charging for services which initially were not charging for. Non-profit marketing organizations use marketing studies to establish the kinds of products their target market would be ready and willing to pay for. The pricing strategies of non-profit organizations, in most cases focus on the welfare of the client and public over equalization of costs and revenues. Where more funds are required to cover costs, the organization might plead for contributions or grants Beamish, (Karen and Ashford, 225).
In marketing for non-profit organizations, the marketing is geared towards non-business objectives as well as social causes. The marketing uses the same ideas that apply to business situations. Whereas the main beneficiary in a business enterprise is the owners, in case of a non-profit organization, the beneficiary should be the clients, the larger public or its members. The objective of a non-profit organization is to portray its exclusive philosophy. The marketing objective of non-profit organization is to obtain required reaction for the intended public. Creating a marketing strategy for a non-profit organization consists of defining and analyzing the intended market and developing and preserving the marketing mix. In marketing of non-profit organization, the product is in most cases a concept or a service (Beamish, Karen and Ashford, 258). Distribution is aimed at announcement of ideas and deliverance of services and the effect is just a short marketing channel. Promotion is very vital to non-profit organization marketing. Among the promotional strategies utilized by non-profit organization include; publicity, personal selling, and advertising to inform the public and the clients.
Distinctive features of non-profit organization marketing strategies
In the same way like other business organizations, mangers of non-profit organizations develop marketing strategies to bring about equally rewarding interactions with the intended markets (Lamb, Hair and Mc Daniel, 364). Marketing in non-profit organization is different in various ways such as the goal setting, choice of intended markets and creation of suitable marketing mixes.
In the private sector, businesses are driven by the profit goal, and it's used as a guideline for decision making and criteria for assessing results. On the contrary, non-profit organizations do not search for profits for redistribution to the owners or shareholders. For instance, the Methodist church does not assess its achievement by the amount of cash left in the offering baskets, but the quality and level of service it has been able to provide. Majority of non-profit organizations are required to offer reasonable, effective and efficient services that take action to the needs and likings of multiple constituents who include the users, donors, politicians, payers' media and general public. Non-profit organizations do not evaluate their success or failure in firmly monetary terms Lamb, (Charles, Hair and Mc Daniel, 364).
The absence of monetary bottom line and the existence of multiple, different, intangible and in some cases vague objectives make giving precedence objectives, decision making and performance assessment difficult for non-profit managers. Non-profit organizations managers must therefore use different approaches from those used by in the private sector business.
Three distinctive features associated to target markets are exclusive to non-profit organizations. Apathetic targets, whereas private businesses usually give priority to those markets that are probable to act in response to specific offering, non-profits frequently target those who are indifferent about to receiving their services such as vaccinations, psychological counselling and family planning guidance.
Non- profit organizations in most cases are pressured to accept undifferentiated segmentation strategies. In certain cases, they fall short of identifying the benefits of targeting or undifferentiated approach may materialize to present economies of scale and low per capital costs. In other, circumstances, non-profit organizations are strained to provide the highest number of individuals by targeting the average user. The difficulty of creating services that target the average user is that there are few average users thus the approach fails to please any market sector Lamb, (Hair, and Mc Daniel, 365).
Balancing positioning, The main role of majority of non-profit organizations is to offer services, with available resources to those who are not effectively served by private organizations. Due to this, non-profit organizations in most cases must harmonize rather than struggle with the efforts of others. The spotting undertaking of non-profit organizations is to recognize the poorly served market segments and develop marketing programs to match their needs instead of targeting the places that might offer higher profits. For instance, a university library might view itself as complementing the services of a public library instead of being a rival to it.
Product uniqueness between business and non-profit organizations
Instead of having simple products concepts, non-profit organizations in most cases market complicated attitudes and ideas. For instance, need to exercise, or eat correct foods, not smoke tobacco, not to drink and drive. The benefits attained from such ideas and messages are complex, intangible, long term and more difficult to commune to clients (Lamb, Hair and Mc Daniel, 365).
Strength of the benefits. The benefit strength of majority offerings by non-profit organizations is weak or indirect. To the general public or consumers, there are no individual direct benefits of donating blood, or even requesting the neighbours to donate money to a charity. On the contrary, service business offers their customers' direct personal gains in trade.
Majority of non-profit organizations are involved in marketing products that bring forth very little involvement such as ("Do not Litter") or high involvement such as (Stop smoking). The range for private sector products is a bit narrower. The traditional promotional tools may not be satisfactory to stimulate acceptance of either high or low involvement products.
Place distribution decisions
The success of a non-profit organization offering is evaluated by its ability to distribute its service offering to intended customers groups at the time they need it and at a suitable location. For instance, majority of land-grant universities in USA provide extension programs throughout their states in order to get to the general public. In addition, some education institutions also present classes to student in locations outside the campus through interactive video equipment.
The extent of a service depends on the fixed facilities required for it to be effective and implications for its distribution. Normally services such as rail, beach skating can only are delivered only a particular point. However, majority of non-profit services do not rely on special services to be provided. For instance counselling only needs the meeting of counsellors and the clients (Lamb, Hair and Mc Daniel, 366).
Majority of non-profit organizations are outlawed form openly form advertising therefore limit their opportunity for endorsement. In some cases, some non-profit organizations do not have the funds to pay for advertisements promotion consultants or marketing staff. Among the few special promotional options available for non-profit organizations include;
Non-profit organizations, in most cases look for marketing or advertising professionals to assist them create and execute promotion strategies. In certain situations, a marketing agency gives its service in substitute for potential long term benefits (Lamb, Hair, and Mc Daniel, 366). In most cases services given out freely build goodwill individual contacts and general alertness of the donor's organization capability and character.
Sales promotion activities that utilize existing services or other resources are progressively more being used to create awareness to the offering of non-profit organizations. In other case, non-profit charities work together with other companies to get promotional activities.
Use of public service advertising involves an announcement aimed at support a program of a federal, state or non-profit organization. Contrary to business advertisements, the sponsor of PSA does not pay for the time or space and instead it's offered by the medium. The Advertising Council has come up with some unforgettable advert of all time such as the one in which the Smokey the Bear reminded people to be cautious not to set off forest fires.
Other non-profit organizations have been flourishing in providing debates for people to exchange their familiarity. For example, the March of Dimes Birth defect foundation developed an online forum to collect real life stories that assist communicate on its mission to prevent defects during birth, premature birth and infant deaths (Lancaster & Reynolds, 126). The organization anticipated families to exchange their experiences in the form of short stores.
Among the five characteristics that differentiate pricing decisions for non-profit organizations and those of other business include;
Pricing objectives: The major goal in pricing for business is profit maximization and maximum returns on investment. Majority of non-profit organizations are also concerned about revenue generation although they look for to either partly or fully settle the costs instead of attain profits for distribution to its stakeholders (Lancaster and Reynolds, 128). Non-profit organizations also search for relocation of profits by taxation. In addition, non-profit organizations strive allocate resources equitably among people, or households or political boundaries.
Non-monetary prices: in majority non-profits organizations consumers do not pay any money for service rendered but instead they are required to absorb the non-financial costs. The significance of those costs is exemplified by the large number of entitled citizens who don't take advantage of the so-called free services for the underprivileged. In majority of public assistance programs about half of those entitled do not take part (Lancaster Reynolds, 128). The non financial costs include opportunity cost of time, effort costs and embarrassment costs.
Division between users and payers: By their plan, services of non-profit organizations are offered to those who are comparatively underprivileged and basically paid for by those who are wealthy. Even though, instances between payers and users are also found in the business sector such as in insurance claims, this practice is negligible in business (Sargeant, and Wymer, 118).
Services priced below costs. University tuition is a good example of below cost pricing. Virtually all public universities in USA price their services lower than the cost.
Facets of non-profit marketing
Professional marketing for non-profit organizations depends greatly on keeping in touch with the outside groups or publics to accomplish marketing activities. A non-profit organization becomes well known, assists other people to recognize its undertaking and persuade public perception towards it by marketing actions such as publicity, public relations or advertising (Sargeant, and Wymer, 117) . Non-profit organizations marketing experts employ volunteers, organization board members and other individuals who offer support by communication using public announcements, flyers located in open locations and individual recruitment requests. Attraction of funding is accomplished through communication media such as direct mail, non-profit's website, telephone soliciting and interpersonal contacts.
Non-profit organizations are a vital component of the civil society, by their role in offering important services to the society that cannot be suitably provided by private sector business or the government (Druncker, 55). The administrators of non-profit organizations have reacted to the various problems facing the sector by focussing on marketing (Beamish and Ashford, 259). They have adopted a marketing outlook and applied marketing strategies in their communication actions, employing volunteers, requesting funds and in creating relations with publics and individuals outside the organization.