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2. The State of Marketing in the Public and Non-Profit Sectors Jim Mintz, Director Centre of Excellence for Public Sector Marketing

3. 3 Centre of Excellence for Public Sector Marketing (CEPSM) Our Mission  To advance the marketing discipline in the public sector. Our Mandate  To provide a focal point for public sector marketing expertise that will encourage and support innovation in marketing, communications and delivery of services to Canadians, while instilling pride in the field of public sector marketing.

4. 4 Professional Development and Training  Workshops, courses (Professional Certificate In Public and Non-Profit Marketing) Ottawa/Toronto  In-house training and coaching Professional Advice and Coaching  Strategic marketing planning/research & marketing performance measurement  Revenue/cost recovery strategies and marketing best practices assessments/audits and human resource management (marketing)  Strategic marketing for web and interactive products  Partnership/strategic alliance strategies with private and other sectors Tools and Resources  Web-based information/tools/resources/speakers for conferences Centre of Excellence for Public Sector Marketing (CEPSM) www.publicsectormarketing.ca

5. 5 CEPSM Clients

6. 6  Long-standing debate about the relevance of marketing to the public sector and, to a lesser extent, the non-profit sector, e.g.  Marketing implies economic choice, which does not always apply to government or non-profit situations  The concept of democracy does not lend itself to influencing attitudes and changing behaviour (as opposed to responding to the unfiltered demands of citizens)  These notions have now been dismissed as overly simplistic given the range and complexity of government and non-profit activities Setting the Scene

7. 7  Initial resistance and lack of perceived applicability gave marketing a late start; however, it has now been recognized that there are qualified applications of marketing that can make a significant impact.  Social marketing can help to change attitudes, values and behaviour for the collective well-being  Strategic marketing, segmentation and other concepts can be applied to improve the impact of programs and services  Marketing techniques can be used to help make better resource trade-off decisions  For fee-based products and services (including fundraising), product marketing concepts can be used to improve uptake Setting the Scene

8. 8  Important to advance good marketing practices within both the public and non profit sectors  The purpose of the “State of Marketing” survey was to do exactly that:  It can be used as a benchmark to determine the marketing health of public and non-profit organizations  It can be used to identify specific training and development initiatives to effect improvement  It can be used to gauge the success of these interventions  A concerted effort to improve the state of marketing can have a positive impact on employees, citizens, stakeholders Setting the Scene

9. 9 The Nuts and Bolts of the Study  Online survey of 575 people in marketing-related positions in government and non-profit organizations across Canada  Email invitation with one follow-up to a list of approximately 6,000 people in government and non-profit organizations (identified as being in marketing-related positions)  Response rate was 10% (over 600 began the survey)

10. 10  Respondents rated their organization based on agreement or disagreement (5 point Likert scale) with 72 statements related to different aspects of marketing  Statements were based on an extensive literature review to identify best practices and characteristics of marketing organizations  Definitions were included to ensure common understanding of key concepts, terminology The Nuts and Bolts of the Study

11. 11  Using an analytical technique called factor analysis, the 72 measures were condensed into 8 underlying constructs that can be used assess the marketing health of organizations in the public and non-profit sectors. These are: 1.Marketing Information and Measurement 2.Planning 3.Culture 4.Management 5.Knowledge and Skills 6.Organization 7.Outputs/Results 8.Resources The Nuts and Bolts of the Study

12. 12  Performance indices were developed by averaging the scores on the individual measures included in each construct and then converting the scores to a 100-point scale  100 = all individual measures received a rating of 5 out of 5, indicating strong agreement  75 = average rating of 4 out of 5, where 4 indicates some measure of agreement  50 = average rating of 3 out of 5, where 3 indicates that they neither agreed nor disagreed  25 = average rating on all individual measures of 2 out of 5, indicating some disagreement  0 = all individual measures received a rating of 1 out of 5, indicating strong disagreement The Nuts and Bolts of the Study

13. 13 The State of Marketing

14. 14 Behind the Numbers Culture Culture MeasuresGovernmentNon-Profit Managers and staff understand client motivations for using their programs and services 3.23.5 There is a shared understanding of the priority clients/audiences 3.13.4 Senior executives and board members consider the needs of priority audiences when making decisions 3.33.7 Everyone in the organization is focused on delivering superior value and service 3.54.0 There is a common understanding of marketing across the organization 2.32.8 The organization is flexible in responding to changes in audience needs 3.13.7 There is collaboration between marketing and non-marketing functions 3.13.4 Senior executives have a good grasp of marketing principles 2.53.1 There is coordination across workgroups to view clients through a single lens 2.93.4 Developing new, valued approaches to serving clients is encouraged 3.63.9 Complaints from clients are not ignored 4.04.3 Marketing is recognized as an essential function within operational units 3.33.9 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “The concept of marketing, or social marketing for that matter, is not really part of the lexicon in this department.” “The department doesn’t know or want to know how marketing fits into initiatives because it sounds too pro-business and non- governmental.” “We seem to take one step forward and then two steps back every time there’s a change in the government environment.”

15. 15 Organization MeasuresGovernmentNon-Profit There is a senior management position with overall responsibility for planning and coordination of marketing across the organization 3.73.8 The senior executive or manager responsible for marketing works closely with the head (DM, CEO, Executive Director) of the organization 3.74.2 There is strong alignment between the marketing and communications functions 3.43.8 There is a distinct group with responsibility for planning and coordination in relation to client-centred objectives 3.83.3 The organization distinguishes between marketing and communications 3.6 Staff in the unit responsible for marketing work with managers and staff in operational or program groups 3.63.7 Responsibilities of the marketing function extend beyond communications to include a role in program and service development 3.53.9 Strategic marketing is a top priority for the organization 2.73.4 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “Marketing here is governed by a centralized communications department that finds marketing to be a foreign concept.” “Historically, marketing and communications were considered synonymous. Only recently have we started to recognize the difference.” Behind the Numbers Culture

16. 16 Planning MeasuresGovernmentNon-Profit The organization has a clearly defined brand strategy and vision 3.13.5 Measurable marketing objectives are established at the organizational level 2.63.2 Marketing plans are prepared for programs and services, including specific goals and marketing mix strategies 2.93.0 The marketing plan is aligned with the mission and vision of the organization 3.33.6 Marketing plans are regularly revisited and updated based on changes in the environment 2.83.0 There are clearly defined communication strategies linked to marketing plans 3.03.1 There is a formal marketing planning process at the organizational level 2.62.8 Client/audience segments are identified and targeted on a priority basis 3.23.3 Marketing budgets are established based on identified strategies and tactics 2.62.9 Marketing decisions are made based on intelligence and evidence 3.03.3 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “We do not have an overall marketing plan. Each program has a plan if it is appropriate and each program is funded in this way. As an NPO, we do not have the resources for a marketing position. As well, we do not market the organization, but specific programs.” Behind the Numbers Culture

17. 17 Management MeasuresGovernmentNon-Profit There is a clear process to bring clients into the system and address their requirements once they have been identified 3.23.5 There is a close working relationship with stakeholders and partners involved in the delivery of products, programs and services 3.43.5 High value ideas and innovations that are identified are acted upon in a timely manner 2.73.2 The activities that we engage in are strongly aligned with the overall image that we want to project 3.64.0 We actively communicate the value of our programs, products and services to clients/audiences 3.43.7 Fees (where charged) are based on an understanding of the impact on usage and uptake, as well as cost-recovery or revenue requirements 3.33.6 The client experience is coordinated to ensure consistency across different service delivery channels 2.93.2 The process for identifying and developing new products, programs and services is proactive rather than reactive 2.63.1 There is a clearly defined process for identifying and developing new products, programs or services in response to client needs 2.73.0 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “My organization seems to put no value on marketing or feel they don’t need it. We use marketing and communications in a reactive manner.” “I would like to see a coordinated effort between what we call project leaders and marketing communications. Instead of marketing products or services based on internal political thrusts, look at what people actually need, built it, market it and continually serve these clients to meet their needs.” Behind the Numbers Culture

18. 18 Knowledge & Skills MeasuresGovernmentNon-Profit Marketing managers and staff are encouraged to attend courses, seminars and conferences to develop their marketing expertise 3.3 People in service and program management positions have received training in marketing principles and management 2.52.6 We have no difficulty attracting and retaining qualified marketing staff 2.8 The organization readily adopts new techniques, including technologies, required to deliver marketing strategies 2.73.1 Staff members are encouraged to acquire the resources (tools, services, outside consultants) they need to conduct marketing activities 3.03.2 Staff in the group responsible for marketing tend to have backgrounds (education or work experience) in marketing 3.2 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “Often in smaller municipalities, there are no designated staff for marketing, and only limited direct marketing resources. Marketing is either shared by several staff or only part of one staff member’s responsibilities. And, this staff member has usually evolved into the role and may not have formal education in marketing.” “Marketing is not respected by colleagues. Economists have much more “cachet”.” Behind the Numbers Culture

19. 19 Behind the Numbers Marketing Information & Measurement Marketing Information MeasuresGovernmentNon-Profit Research is used to assess the extent to which we are delivering superior value to clients 3.02.9 Insights from multiple sources (e.g. marketing research, internal databases, managers) are integrated to create a full view of audiences 2.92.7 Research is used to track brand awareness and image 2.82.6 Marketing research is used to develop new products, programs, services or marketing programs 2.72.8 Primary and secondary marketing research is used on a systemic basis to understand client markets and evaluate elements of the marketing mix 2.72.5 We have good measures of our market penetration, as well as an understanding of which audiences are not using our programs, products or services 2.93.0 Our organization is very good at identifying potential shifts in the market before they have a significant impact on our performance 2.62.9 We have a good understanding of our strengths and weaknesses relative to alternate programs and options available to clients 3.23.6 We have a good understanding of client segments and are familiar with the characteristics of each segment 3.43.5 “Our organization has a long history of developing products and services and subsequently delivering them to Canadians with the misconceived idea that they are the correct products and services. We have done an abysmal job of determining what clients want.”

20. 20 Marketing Information Measures (Cont’d)GovernmentNon-Profit A process is in place to measure marketing performance against stated objectives 2.72.8 Measurement results are actively used to identify priority areas for improvement 2.9 Information on clients/audiences is shared across work groups or relevant partners to develop a common understanding of the audiences 2.83.0 Information systems make it easy to access, analyze and share insights into client markets 2.8 Our organization regularly achieves or exceeds its marketing objectives 2.83.0 We have a good understanding of how to allocate our marketing funds to achieve optimal impact 2.82.9 Managers and employees are rewarded for achieving marketing objectives or improving value delivered to clients 2.3 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “While this organization does undertake marketing related to events and membership, there is no budget nor will (from upper management) to measure success of our efforts, which is essential to any plan.” Behind the Numbers Marketing Information & Measurement

21. 21 Resource MeasuresGovernmentNon-Profit Marketing budgets (including communications) are sufficient from year to year to implement identified strategies and tactics 2.52.6 The number of staff working in the unit responsible for marketing is appropriate for the size and needs of our organization 2.6 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree “As a non-profit organization, the resources available for marketing are extremely limited. There are huge expectations from government partners to undertake marketing activities, but very few resources allowed to do so. Government partners also have difficulty understanding that marketing tools need not be flashy or expensive to have impact.” “The public sector does not generally recognize and value the marketing function, so it is usually under-staffed and under-funded. With the lack of dollars, the marketing function then under-delivers.” “The marketing budget and activities are very dependent on funds raised from government and business, and it varies from year to year. This makes it difficult to retain staff. Without staff, it is difficult to develop and follow a marketing strategy.” Behind the Numbers Resources

22. 22 Output MeasuresGovernmentNon-Profit We have attracted new clients or members to use our programs and services 3.53.8 Clients have migrated from other alternatives to our programs and services 2.93.3 Client satisfaction is maintained at high levels 3.53.8 Revenues from fee-based products, programs and services (including fundraising) have grown 3.03.6 Our organization and its mandate has gained in prominence and importance among funding stakeholders (including government and political) as a result of marketing activities 3.33.6 There has been a measurable impact on the attitudes and behaviours of the audiences we target 3.4 Our products, programs and services are unique or more highly valued relative to other alternatives 3.43.7 * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree Behind the Numbers Results & Outputs

23. 23 Key Findings  Overall, professionals involved in marketing gave their organizations a low overall score across all of the factors deemed to be important for successful marketing. In particular, lower ratings were given to resources, marketing information and measurement, knowledge and skills, and planning.  Although non-profit organizations tend to score higher on all indices, the study paints a bleak picture of the overall marketing health of these two sectors. Government, in particular, seem to lack the culture, strategic planning environment, management systems, knowledge and skill set, marketing information and performance measurement regime that are indicative of market-centred organizations.

24. 24  Analysis by level of government suggests that crown corporations and provincial / municipal government organizations demonstrate a stronger orientation towards marketing compared to the federal government.  Within the government sector, a higher proportion of provincial and municipal government organizations scored better on the culture index compared to federal government organizations.  In comparison to government, non-profits exhibited an organizational culture that was more focused on offering value and service. Key Findings

25. 25  Both government and non-profits demonstrated particular neglect for incorporating a formal marketing planning process and establishing measurable marketing objectives at the organizational level.  Public sector organizations fail to consider client needs when developing service approaches and product/program/service offerings. Governments, scored low on implementing a proactive process that considers client needs when identifying and developing new products/programs/services, Key Findings

26. 26  The performance of both government and non-profits on knowledge and skills of marketing indicates that, while some organizations display a willingness to provide the necessary skills, they do not necessarily back up this promise in terms of organizational support and culture.  Marketing professionals in both the government and non-profits noted that their organizations were particularly poor performers when it comes to rewarding staff for achieving marketing objectives or improving value delivered to clients. Key Findings

27. 27  Government and non-profit organizations do not effectively use market research and other lines of evidence to gather information to support their marketing function.  Government and non-profit organizations tend to be reactive, rather than have proactive systems in place to address shifts in the marketplace.  Marketing within both government and non-profit organizations tends to be managed in silos (based on program or operational units), Key Findings

28. 28  A majority of respondents indicated that marketing planning will be a priority area of focus for their organization in the coming year.  Marketing professionals from non-profit organizations expected service quality and client relationship management to be a priority in the coming year, while government organizations will place some priority on managing service delivery channels. Key Findings

29. 29 Implications and Directions  Need to educate senior managers in government and non profits about value and applicability of marketing i.e. potential impact on effectiveness/efficiency of programs, and services as well as benefit to citizens.  Wide recognition of the role and value of the communications function in both government and non profits. Opportunity to broaden this function to include a strategic marketing mandate thereby re-positioning it as an expanded role. Viewing communications within a broader strategic marketing framework will help to drive results in program uptake, program impact and behavioural change.

30. 30  Marketing does not occupy an institutionalized position. No clear marketing function or job category and few positions include “marketing” in their titles. Need to look at process for hiring marketing personnel and assigning responsibility for marketing to senior manager  Need to examine the process used to develop and manage client-centred products, programs and services.  Marketing management systems and practices must be adopted from the planning level on down.  Measurement systems must be put in place to track success against marketing objectives and make necessary adjustments to improve performance. Implications and Directions

31. 31 Implications and Directions  Many in government and non profits identify marketing with cost recovery or revenue generation. It is true that marketing can assist in these areas but it can also be a useful paradigm and more valuable for other goals of government and non profits, such as improving relationships with groups and individuals with whom the organization interacts, and serving clients better.  Most people performing marketing functions in public and non profits do not have formal training in marketing; therefore need for marketing training such as “Professional Certificate in Public Sector and Non-Profit Marketing” run by Sprott School of Business as well as keeping up to date on public sector marketing issues by attending the annual MARCOM conference in Ottawa in June.“Professional Certificate in Public Sector and Non-Profit Marketing”Sprott School of BusinessMARCOM

32. 32  Marketing can be beneficial for the following four reasons:  existing and potential clients are guaranteed to play a major role in developing and implementing a program/product/service;  all program elements are focused on behaviour change instead of settling for changes short of that goal, such as awareness;  initiatives tailored to specific segments of the market ensure efficient use of limited resources; and  the application of 4 Ps will always ensure that the campaign will move beyond just promotion.  As non profits/government continue to try to meet the challenges associated with demands for better and improved service delivery with budgetary constraints, new and different models of management need be considered. Marketing presents a comprehensive, integrated and innovative approach. Implications and Directions

33. 33 Order Copy of Report  www.publicsectormarketing.ca/resources_e www.publicsectormarketing.ca/resources_e

34. 34 Articles on the Survey http://www.optimumonline.ca/frontpage.phtml http://www.networkedgovernment.ca/MarketingPracticesMintz THE CASE FOR MARKETING IN THE PUBLIC SECTOR GOVERNMENT FAILS TO PICK UP MARKETING BEST PRACTICES

35. 35 Questions?

36. Our Mission: “To advance the marketing discipline in the public sector.” Jim Mintz x18 Email: jim.mintz@publicsectormarketing.cajim.mintz@publicsectormarketing.ca

37. 37 Marketing “Vital Signs” Checklist Take the Test: “You know you are a marketing-driven organization when…”

38. 38 You know you are a Marketing Driven Organization when: 1. Do not use terms like “general public” when referring to your target audience 2.“Plan” is more than a four letter word 3.All marketing activities are coordinated and integrated into an overall plan 4.You focus on results and NOT process and politics 5.Your organization takes “risks”, although ensuring they are “reasoned risks”

39. 39 6.You do not keep doing the same things every year (Prgms, etc…) 7.Marketing campaigns consistently meet their goals and objectives 8.You take action when results are not achieved 9.You have a clear understanding of the needs of your target group(s) 10.You have a dedicated marketing budget 11.Your organization’s brand has value 12.“Reinventing the wheel” is not standard operating procedure You know you are a Marketing Driven Organization when:

40. 40 13.You value training in areas like marketing and communications 14.Performance measurement is something that your organization does regularly 15.You are up to date with the latest trends, technologies in the area of marketing and communications 16.Branding is more than a visual identifier 17.You are open to change 18.You see the need to understand your “competition” You know you are a Marketing Driven Organization when:

41. 41 19.Your organization is focused on “outcomes” not “ outputs” 20.Evidence-based decision making is in your organization’s vocabulary. 21.Strategic alliances/partnerships are a key component of your marketing activities 22.Your marketing objectives are SMART (Specific Measurable, Attainable, Realistic and Time Limited) 23.Your organization does not use the web as a warehouse to store information You know you are a Marketing Driven Organization when:

42. 42 24.You use all the elements of the marketing mix (4 p’s) and not just promotion 25.You organization believes that the ultimate objective for marketing is not education and creating awareness, but behaviour change You know you are a Marketing Driven Organization when:

43. 43 If You Scored:  20 – 25 You have the tools, processes and culture in place to be successful and sustainable  15 – 19 You are on the right path, but need to examine those areas where you are weak  10 – 14 You are most likely struggling and need to take a hard look at priorities and processes  6 – 9 You are on the borderline of existence as an organization You know you are a Marketing Driven Organization when:

44. Our Mission: “To advance the marketing discipline in the public sector.” Jim Mintz Email: jim.mintz@publicsectormarketing.cajim.mintz@publicsectormarketing.ca