Getting non-profits to think like private-sector marketers
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Ten years ago, when Pamela Ross made the leap from the agency world to the charity sector as director of marketing at Foster Parents Plan, she decided to join the committee of a not-for-profit association. The discussion at her first meeting was about developing materials for small charities to help them improve their results, “like an off-the-shelf book they could reference and learn quickly how to do fundraising,” recalls Ross, now VP of communications and chief marketing officer at Toronto’s Sunnybrook Foundation, the fundraising arm of Sunnybrook Hospital.
In the meeting, Ross suggested the book should include a section on brand. “The chair of the committee looked at me and, I don’t remember the words she used exactly, but essentially she said there is no value in that and it would be a waste of our time.”
While Ross didn’t exactly get booted out for using the “b” word, her first committee meeting was also her last. “I knew I had a difference in thinking,” she says. “So that was the kind of environment I experienced when I first came to the non-profit sector.”
It’s a familiar story for many marketers and agency staff who have crossed into the foreign waters of the charity world, where even the words “marketing” and “branding” were (and in some cases, still are) taboo.
“Historically, charities have been suspicious of marketing and there’s the sense that spending on marketing is not being good custodians of the donor’s money,” says Neil Gallaiford, president and CEO of Toronto-based ad agency Stephen Thomas, which focuses exclusively on the non-profit sector. “Charities have not supported their brands the way a commercial organization would.”
But a dramatic shift is happening, as not-for-profit groups take a page from the corporate sector to build their brands. As some of Canada’s biggest charities hire more people from the private sector, they are becoming more sophisticated marketers by embracing the potential of a clearly defined brand.
While they can’t (and won’t) spend money like the Coca-Colas and L’Oréals of the world, the not-for-profit sector “is redefining itself and understands that branding and marketing is key to growth and survival,” says Paul Alofs, president and CEO at The Princess Margaret Hospital Foundation, who joined the organization eight years ago. He is the former general manager of The Disney Stores and former president of HMV Canada.
It’s not about slick marketing campaigns or designer websites – but a massive shift in thinking within these organizations. “This is an evolution… but it’s happening at the level of the DNA in these social enterprises,” adds Alofs. “The DNA of social enterprises is changing to become marketing-driven and brand-driven.”
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The catalyst, as with anything, is competition. There are more than 80,000 registered charities in Canada, all competing for dwindling donor dollars. (In 2009, Canadians claimed a total of $7.8 billion in charitable donations on their tax returns, down from $8.2 billion the previous year.)
The private sector is also a competitor, as corporations increasingly focus on their own cause-related marketing activities and roll out corporate social responsibility initiatives to appeal to a more mindful public.
Even products not directly tied to a cause are competitors. Gallaiford uses the example of Toyota. “They bring out a Prius and it costs an extra $3,000, but if I buy a Prius, aren’t I making a $3,000 contribution to the environment? It’s pretty hard not to see it that way,” he says. “If you want people to give to the environment, then environmental charities had better have their brands out there. If people don’t know who these charities are, then how can they contribute to them?”
Getting your brand out there sounds simple enough. But the non-profit sector plays by an entirely different set of rules than the for-profit world, and the challenges for them are numerous: resources are limited; boards of directors may not understand the importance of marketing; and donors scrutinize every dollar spent and are often resistant to advertising. To top it off, the accepted spend ratio is that no more than 20 cents of every dollar raised can be used for administration and marketing.
First and foremost is the challenge of getting the board of directors to recognize the necessity of building a brand. “The strategic direction that charities take comes from the board,” says Ross. “And board members who understand the financial contribution that a strong brand makes to an organization will drive the building of a brand. If the board and senior staff want a strong brand, then it will happen. And if they don’t, it won’t.”
Phyllis Yaffe, former CEO of Alliance Atlantis, agrees marketing is less esteemed in the non-profit world. She has extensive experience on boards of directors in both sectors, and is currently chair of the board at Cineplex and chair of Women Against Multiple Sclerosis. “People come to not-for-profit boards with a lot of different experience and for a lot of different reasons,” she says. “You could easily wind up with people who don’t actually like the word ‘marketing.’” If they believe using marketing to accomplish fundraising is “a bad thing, then you’re going to have a real struggle in that organization,” she adds.
Given this diversity of backgrounds, it’s up to marketers to educate board members on the value of getting the word out. “So that becomes a challenge,” says Lisa Chicules, VP of marketing and communications at Heart and Stroke Foundation. “How do I educate them, how do I help them understand the benefits, how do I help them know that this is worthwhile? Because you will need their support and approval.”
Board members who hold the most sway are the ones who have a background in finance, notes Dan Pallotta, author of Uncharitable: How Restraints on Nonprofits Undermine Their Potential, and founder of Los Angeles-based Pallotta TeamWorks, which created the AIDS Rides and 3-Day Breast Cancer Walks in the U.S.
“Those are the people who the marketing people hate in any business… And even if you have someone on a board who is a marketer, they’re infected with the same prejudices and religion as the rest of us about charity. Even though they built a successful business by marketing and spending money marketing it, coming to a charity boardroom, something lobotomizes them and they start to insist on a charity getting only donated ads if it wants to advertise.”
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