I get a lot of mail each week. Although I prefer checks to bills, as we all do, this past week’s mail got me thinking about how not-for-profit organizations operate. Since my family donates to charity periodically, we receive many solicitations from local and national organizations requesting a donation. Many of these direct mail requests also come from magazine subscriptions (we have a lot).
When you compare for-profit and non-profit businesses, a “sale” to a nonprofit is a donation, which helps the organization deliver its needed services to the community. How can a for-profit business take some cues from the nonprofit world when handling its marketing initiatives?
- Have a marketing budget: In those direct mail pieces, many of the nonprofit organizations are required to list what percentage of their budget is spent on promotion. While some might think that spending on promotion is a negative thing, I think we should look at it as a positive: more marketing brings more awareness, which in turn brings more “customers” (donors) to the organization. Hence, it would make sense that a for-profit should always have an advertising and marketing budget in order to bring awareness and increase sales.
- Spend more of your marketing budget to reach your best (and return) customers. Once you have donated to an organization, do you ever notice how you will get another donation letter three, six or nine months later? That’s because these organizations have learned that past donors are increasingly more likely to donate again, I’m sure the ROI is much greater when mailing to existing donors. For-profits should do the same, and focus much of their budget on mining existing customers for repeat business.
- Don’t just ask for the big purchase — give them options. On the donation return forms, the nonprofit organizations always list two or three suggested choices for donations, rather than just listing a large amount. People are always welcome to donate more, but having multiple options puts the decision in the donor’s hands. Similarly, if you have a for-profit business, suggest two or three different services or products with varying price points, to give your customers the option to choose what they prefer.
- Focus on the impact, not on the service/product. A charitable organization sales letter usually profiles a success story on how the donation has helped an individual or family through a struggle. The focus is not on the organizations’ day-in-and day-out operation. Thus, when you are writing a sales letter, postcard, web page or advertisement, your focus should be on alleviating the customer’s pains or struggles, or providing them with a much-needed benefit. You should not be detailing every last feature of your product or service.
- Thank your customers. A little token of appreciation goes a long way. So don’t forget to thank your customers in your sales letter, or even by sending them a little gift with purchase. Nonprofits often send promotional products like notepads, return address labels, bookmarks or calendars. Think of something appropriate that you can send to your best customers to keep them coming back for more, and to promote goodwill. You could include it prior to the purchase to try to persuade, or you could include it as part of the order. Some nonprofit organizations will host special events just for their top donors. Again, along these lines, you could host a get-together or celebration to thank your top customers. Or maybe donate in your customers’ honor to a local charity.
Nonprofit organizations and for-profit organizations are really a lot alike in terms of how they operate. However, I believe the nonprofit world has the edge when it comes to smart and effective marketing. If more companies would take a cue from these organizations, their success might improve substantially.
Can you think of any other ways that nonprofits market better? Please leave a comment below.