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Mission Based Marketing Presented to the Association for Progressive Communication October 15 -16, 1998 by Charles P. Sitkin, Consultant in affiliation.

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Presentation on theme: "Mission Based Marketing Presented to the Association for Progressive Communication October 15 -16, 1998 by Charles P. Sitkin, Consultant in affiliation."— Presentation transcript:

1 Mission Based Marketing Presented to the Association for Progressive Communication October 15 -16, 1998 by Charles P. Sitkin, Consultant in affiliation with Carnegie-Mellon University How your Not-For-Profit can succeed in a more competitive world.

2 Outline of Presentation Mission-Based Marketing—What? Customers Competition Marketing Marketing Material Customer Service Financial Empowerment Final Words

3 Mission-Based Marketing The tide is changing—the world of the Internet is competitive You are now in a competitive world—Is there still a need for NGO-specific services? Dealing with this means being Mission-Based yet Market-Driven

4 Mission-Based—Market-Driven The Mission or the Market –The market is always right—determines success –The market is not always right for you –The mission should be the ultimate guide Moving with the markets—maintaining your mission –Have the Mission visible—everywhere –Use the mission statement constantly –Use the mission in market/service decisions Hold on to your Core Values

5 Successful Not-For-Profits Meet wants not needs Treat everyone like a customer Have everyone on the marketing team Ask, Ask, Ask and then Listen Innovate constantly Don’t fear the Competition

6 Customers

7 Meeting Customer Wants Huge difference between needs and wants Target wants People have needs—people seek wants

8 The Customer is Always Right—Wrong! The Customer is not always right—but The Customer is always the Customer The Customer may not be right for you

9 Competition

10 Competitive Intensity

11 Who Are your Competitors? Internal Markets –Board Members –Staff External Markets –Funders: government, members, foundations, donors –Products/Services: fees, prices, charges –Referrers: customers, suppliers, funders

12 Study the Competition Do Not Fear Competition—Learn From Them What do you know about them? –What Services do they provide? –What clientele are they seeking? –What value do they provide customers? –What are their prices How Do you research your competition? –Public Records, customer, and Board, Staff, and Volunteers What are your competitors after? –What people or things is your competition trying to take away from you?

13 Be Better than your Competition Pay attention to what customers want— give it to them Be better than your competition in the eyes of your customers Competing is not bad—not immoral Competing means being able to do more Mission Tell customers how good you are.

14 Marketing

15 Marketing—A Team Effort Everything that everyone in your organization does every day Every action effects the entire organization

16 Motivating Board and Staff Talk about the reality of competition Talk about your mission List similar organizations that are now in trouble/out of business Get comfortable with the idea of marketing Get comfortable with the idea of competition

17 Results of being Market-Driven Happier markets—consumers and funders Better image Retain your market More effective and efficient New revenue sources More financially stable

18 Results of Staying Service-Driven Risk continuing to provide outdated services Risk continuing poor relationships with key funders Risk losing historically loyal customers Risk true, perhaps fatal, financial crisis

19 Change with the Market The Marketing Cycle is never-ending Needs flexibility Maintain the capacity for flexibility Be a Change Agent

20 Being a Change Agent Show the Mission connection Go through change together Talk regularly about competition Point out changes outside the organization Don’t wait for big changes Don’t criticize the Past—look to future Be patient!

21 Change in a Competitive Environment Shorter attention span Louder advertisement and media Shorter product cycle End of annual cycles Less sympathy for Not-For-Profits that can’t keep up –Stability is no excuse –Poverty-Chic is out!

22 The Not-For-Profit Marketing Cycle The marketing cycle that works –Marketing doesn’t start with a product/service –Marketing starts with the Market Most Not-For-Profits have a marketing disability

23 Marketing Cycle of a Not-for-Profit 1. Define/Redefine the Market 2. Establish what the Market wants 3. Shape and Reshape your Product/Service 4. Se a Sensible Price 5. Promote the Product/Service 6. Distribute the Product/Service 7. Evaluate, Evaluate, Evaluate 8. Return to # 1.

24 Set a Sensible Price Recovers all of your costs Adds a profit Meets the reality of the market People buy based on value.

25 Disability of Most Not-For-Profits Have service oriented backgrounds React to their own training Knowing what people need—not listening to what they want Train yourself to listen for wants!

26 Ask, Ask, Ask and then Listen First, you ask Second you listen Then, meet as many wants as you can.

27 Who are your Markets? Identify and Quantify your Markets Segment your Market Focus on your target Markets Treat All your Markets like Customers

28 The Market of a Not-For-Profit Internal –Board of Directors –Staff Members Payers –Government –Members –Foundations –Donors –Users Reference Sources

29 Focusing on your Target Markets Segment your market The 80/20 Rule 80 % of your income comes from 20 % of your customers The Strategic Plan Method –Which markets do we want to grow? –Which parts of our community are most important to our mission?

30 Treat All your Markets as Customers Customers, customers everywhere Barriers to the customer service mentality Internal customers Funder or payer customers Service customers

31 Focus on your Core Strengths Review the Markets Evaluate the Competition Look at your core competencies –Do a SWOT analysis –How do your Strengths and weaknesses compare to your competitions’?

32 SWOT Analysis Strength A positive internal aspect of your not-for-profit that you can control Weakness A negative internal aspect of your not-for-profit that you can control, and plan for Opportunity A positive external condition that your not-for-profit does not control, but of which you can take advantage Threat A negative external condition your not-for-profit cannot control, but you can perhaps lessen.

33 Customer Service

34 Three Customer Service Rules The customer is not always right, but the customer is always the customer. Don’t sell services, solve problems— from the customer’s perspective Customers don’t have problems, they have crises

35 The Customer is always the Customer Listen to the whole complaint Acknowledge and apologize Ask them what they want Never make problems you can’t keep Keep excellent notes Never assume a customer is happy

36 Regular Customer Contact All key markets should be offered the opportunity to have input Keep up on customers’ important issues Tell them if things aren’t fixed immediately— call YOU Send a note thanking them for each gift, payment, effort If you guarantee—live with it Check on quality Always follow up with new customers

37 Turn Customers into Referrals Referrals are not truly”free” Don’t be too eager with new customers Always ask permission to use a name as a reference Remember to meet referrers’ wants Always call or write a note of thanks

38 Marketing Material

39 Not-For-Profits Marketing Material Problems The marketing disability –We know what you need—we don’t care what you want Tradition Penny-Wise—Pound-Foolish Public Relations vs. Marketing

40 Include in your Marketing Material Your Mission Your Focus Brevity Connect Problems to Solutions Appearance References Sources for more information about you

41 Avoid in your Marketing Material Jargon Inappropriate Photos Lack of Focus Asking for Money A history lesson Out-of-Date Boring

42 Different Material—Different Markets

43 The Market Planning Process Build on Common Ground Identify target markets Develop baselines Develop an asking schedule Develop a marketing plan

44 Financial Empowerment

45 Three Essential Philosophies Your Organization is a Mission-Based Business No one Gives you a Dime Not-For-Profit does not mean Non-Profit

46 Two Primary Rules for Not-For-Profits Rule One: Do More Mission Rule Two: No Money, No Mission Ignore these rules at your peril!

47 Financial Empowerment Measurable –More revenue than expenses in at least 7 out of 10 years –Cash operating reserves of at least 90 days –At least 5% of total income from endowment earnings –Sources of revenue from non-traditional non-governmental sources: business income

48 Financial Empowerment Management –Shares its financial information widely, practices bottom-up budgeting –Use appropriate leverage Mission –Organizations supports their missions by: »using rapid-response mission reserve »Being financially flexible enough to accommodate changes in service delivery

49 Final Words World will always need Not-For-Profits! Special people form the philanthropic cement for civil society! In ten years, today’s Not-For-Profits won’t be needed! Organizations meeting future perceived wants will be needed! You can be part of such Not-For-Profits! Ask, Listen, Respond!

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