Chapter 10: Organizing for Implementation Chapter 11: Planning the Budgeting and Marketing Mix Chapt

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Chapter 10 Organizing for ImplementationChapter
11 Planning the Budgetingand Marketing
MixChapter 12 Managing the Organizations
Offerings (Products and Services)

• Strategic Marketing (and Management) for
  Non-Profit Organizations

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Organizing for Implementation

• The introduction of marketing in a non-profit is
  often a push or pull phenomenon
• Someone inside gets the idea that marketing is a
  good thing so they push the organization into
  marketing
• Environmental forces may pull the organization to
  consider marketing

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Organizing for Implementation

• Marketing responsibilities
• communications
• public relations (influencing media)
• direct sales
• membership recruitment
• fundraising
• volunteer management
• membership management
• some human resources role
• some information technology and web
  site
• management role

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Organizing for Implementation

• Recruiting Great Marketers
• may have had commercial market experience
• may be difficult to recruit due to low
  salaries in the non-profit sector
• may be subject to the two cultures phenomenon

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Organizing for Implementation

• Identifying viable marketing projects
• the project should have high impart on
  making money or saving money
• the project should have a positive
  benefit/cost ratio
• the project should be completed in a short
  time span
• the project should have high visibility for
  maximum communications impact

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Organizing for Implementation

• How to organize the marketing activity
• By function (a separate department)
• By product (separate marketing structure for
  each offering)
• By Customer ( separate marketing structure
  for each target group)
• Or some combination of the above

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Planning and Budgeting the Marketing Mix

• The marketing mix refers to place, price,
  promotion, and product
• Marketing people must decide what tactics to use
  on each element of the marketing mix and create a
  budget for a particular marketing mix
• So, the marketer must develop a plan (marketing
  plan)

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Planning and Budgeting the Marketing Mix

• What do we have to plan?
• 1. Size of the market for each possible program
• 2. Possible future demand
• 3. Decision on what programs( which includes
  the price, place, product, promotion dimensions)
  to implement (benefit/cost)
• 4. Expenditure level for each program

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Planning and Budgeting the Marketing Mix

• To determine market demand and/or future demand
  we can use these methods
• 1. assess if the market is expansible or
  non-expansible- if expansible the level of
  marketing expenditures delivered to the market
  can increase sales
• 2. use the simple chain ratio method

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Planning and Budgeting the Marketing Mix

• 3. Target intention surveys
• 4. Expert forecasts
• 5. Market tests
• 6. Time series analysis
• 7. Statistical demand analysis

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Planning and Budgeting the Marketing Mix

• Choosing among competing programs through
  benefit/cost analysis
• 1. Identify monetary benefits of different
  programs
• 2. Identify monetary costs of different
  programs
• 3. Compare benefits to cost B/C
• 4. If benefits outweigh costs then program
  is cost effective
• 5. Choose programs with greatest benefits to
  implement first

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Planning and Budgeting the Marketing Mix

• Problems/issues with b/c analysis
• 1. not all benefits are monetary
• 2. not all costs are monetary
• 3. it may be possible to use some
  non-monetary measure of benefits such as lives
  saved
• 4. some benefits or costs may not be
  quantifiable on any basis
• 5. it may be possible to find a proxy price
  for benefits such as asking people what price
  would they be willing to pay for that benefit
  (willingness to pay concept)

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Planning and Budgeting the Marketing Mix

• 6. the technique assumes that the program, if
  adopted, would not change market prices that were
  used to estimate the benefits of the program
• 7. the technique makes no allowance for
  re-distributional benefits caused by the program
• 8. the technique assumes that economic value
  should be given the main weight in deciding among
  programs
• 9. the technique also assumes that the rank
  ordering of projects is insensitive to the
  particular measure of benefit used (the arthritis
  example)

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Planning and Budgeting the Marketing Mix

• What is the optimal level of Marketing
  Expenditures
• 1. Pick what you can afford!
• 2. Select a percent-of-revenues
• 3. What is the competition doing?
• 4. Relate to objectives and tasks
• 5. Use a response function which forecasts the
  likely response of a market during a specified
  period of time associated with different possible
  levels of a marketing element.

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Managing the Organizations Offerings (Products
and Services)

• Because nonprofits are involved in a wide range
  of behavior challenges, a broad definition of an
  offer is therefore needed
• People do things if the benefits outweigh the
  costs.
• Thus, a marketing offering is a proposal by a
  marketer to make available to a target customer a
  desirable combination of positive and negative
  consequences if, and only if, the customer
  undertakes a desired action
• What target audiences want is the set of positive
  consequences and they only evaluate the delivery
  mechanism in terms of its ability to provide
  those consequences at a reasonable cost

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Managing the Organizations Offerings (Products
and Services)

• Consequences often have a product, service, and
  behavioral component to them
• The core product (even if a service) must be made
  tangible to the client
• The tangible nature has these characteristics
  features, styling, quality, brand name, and
  packaging
• The product can be augmented usually by
  additional services and benefits that go beyond
  the tangible product or service (delivery and
  credit options, installation, warranty,
  after-sale service for regular consumer and
  business goods)

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Managing the Organizations Offerings (Products
and Services)

• Nonprofits may vary their product mix just like
  consumer and business goods marketers
• 1. Vary product variety (product mix
  category)
• 2. Vary number of items within a particular
  category

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Managing the Organizations Offerings (Products
and Services)

• Although most offerings contain product and
  service elements, some offerings are just
  services
• A service is any activity of benefit that one
  party can offer to another that is essentially
  intangible and does not result in the ownership
  of anything. Its production may or may not be
  tied to a physical product.

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Managing the Organizations Offerings (Products
and Services)

• Characteristics of services
• 1. Intangible
• 2. Inseparable
• 3. Variable
• 4. Perishable
• 5. Dependent on involvement of customer in its
  production