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Figure 1 - Charities industry


Alzheimer s Society - Analysis Figure 1 - Charities industry Crowded marketplace 190,500 charities though lots are schools. Small number of established strong ... – PowerPoint PPT presentation

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Title: Figure 1 - Charities industry

Alzheimers Society - Analysis
  • Figure 1 - Charities industry
  • Crowded marketplace 190,500 charities though
    lots are schools. Small number of established
    strong key players.
  • Charities have adopted technology in support of
    fund raising facility to provide online
  • Donors tend to favour the big, high profile
    charities e.g cancer research
  • Medium sized charities such as ALZ tend to get
    squeezed out
  • Income is increasing, 2002 2007 increase of
  • Hierarchy Cancer research donations represent
    50,Childrens charities represent 32, Poppy Day
    appeal 25, Animal welfare 20 and Mental Health
    a mere 3.8 of charitable donations.
  • Charity Commission acts as watchdog

Figure 2. PESTLE Analysis
Governments and regulatory bodies need to find a way to increase support for carers, and fund more research to find a cure for Alzheimers. Doesnt seem to be high priority for government today (only spend 13 of that on cancer research). Time bomb waiting to happen as population is ageing especially 85. 100,000 people develop dementia annually and set to increase Increasing strain on NHS where mental health is not as well understood
Global credit crunch has dampened consumer spending has hit all industries. What will be the impact on donations? Likely to see people cutting back here as well though no evidence ye Consumer confidence has hit rock bottom Difficult times ahead as potential for unemployment to increase
People understand the need to give increasing use of Comic Relief, personalities to raise profile Cause related marketing increasingly popular Ageing population older people living longer, divorce rates high so more single households this will result in less carers and puts more pressure on medical services Greater interest in environmental issues, ethical trading, reputation of companies and organisations Amounts bequeathed in wills to rise fourfold between 2010 2050 though may be used to fund children/their own care Social sigma associated with mental illness
Utilise to find a cure Brain games e.g Nintendo DS a useful way to prevent Alzheimers Opportunities are endless in terms of marketing Sophisticated database marketing techniques now possible More and more activity on internet and people willing to donate on line
Legal action can be taken against companies who are unethical, flaunt I.P, non compliance offences Power of bodies like NICE can impact ALZ and use of drugs requires court action to fight
C.S.R.- drug companies have to be more transparent, ethical sourcing and testing Growing need for companies to target environmentally aware and cause related target segments
Figure 4 - Financial Review
Income Increased by 4.2m 10 11 grants, 23 sales and fee income 19 legacies and 2 donations and subscriptions (120,000 people) though this plus grants makes up 68 income. Need to focus on increasing income from donations
Expenditure Fairly consistent with care homes taking 78 and fundraising costs 13. Spent 1.7m marketing activity - 4
Reserves ALZ has some reserves which I could use if needed
Donations m
Big brands have greater fund raising
power. Awareness of brand is important so
potential donors know what ALZ stands for.
Currently ALZ brand awareness limited. Memorable
campaigns such as Cancer Research I shouldnt be
here key to driving support/donations.
Figure 7. Value Chain
Firms Infrastructure - Use of strong management
teams to maximise effectiveness , use of
strategic alliances/collaborations to strengthen
buying power ,and maintain lean structure and
tight control of costs.
Support Activities
HR Management - Important to hire astute,
adaptable people who share the companys core
values. Need to manage part time volunteers and
have flexible HR policies Manage relationships
with suppliers, high net worth supporters and
all other donors.
Technology Development - The Charity industry is
highly competitive so ALZ need s to keep abreast
of developments and continually maintain their
focus on new technology. Maximise new
technologies (mobile and internet), build
database of high net worth individuals /donors to
target for marketing campaigns.
Procurement identify the right partners to work
with, affinity partnerships, investigate
possible mergers and international acquisitions.
Get best deals on purchases to minimise
expenditure and drive profit.
Operations Ensuring that staff and
volunteers/ supporters are proactive.
Inbound Logistics Sufficient number of
distribution points to maximise income potential.
Outbound Logistics Centralising donor acquisition
and processing.
Marketing Sales Brand positioning Promote
ethical trading Maj. of income is spent on
finding a cure.
Service Excellent customer service at all times
in person/ Online/helpline. Customer intimacy
B2B and B2C
Primary Activities
Figure 8. 7S framework
Strategy Growing pressure internationally Grow value from new and existing donors Increase awareness of Alzheimer's and mental illness generally ideally identify ways of early prevention. Lead research effort to find a cure Lobby government to put more resources into research and care. National Dementia Strategy launched (opportunity?). Need to decide what primary role is and what is core offering plus also measure the impact of services.
Structure Board of 12 trustees 230 branches 5000 volunteers UK based but intl presence 25,000 members with voting rights and liable Committees for remuneration, nominations, audit (risk) and investment - Is too bureaucratic?.
Systems Internet site Web forum with 130,000 posts DVD training Phone helpline Usual HR, Finance systems.
Shared Values Published values (Passion, Quality, Integrity, Inclusion, Mutual respect)
Skills Improving skills/education of carers/donors. Strong in care and education. Innovation and change will be important skills. Exam for carers and training programme tomorrow is another day Internal audit skills Small marketing team only 3 years old. Need to be innovative in marketing/PR as competitive market. Do they have the skills to grow the business internally?
Staff 5000 volunteers great advocates for the charity. Have 25,000 members Branch managers are salaried Rely on volunteers is this enough? Do need to consider employed roles what is the ROI?
Style Nothing specific in case study but assume local autonomy, open and collaborative , transparent ethical and caring.
Figure 9 SWOT
Strengths Income increasing year on year and sector growing Individuals will donate to causes they believe in Strong in care and education 30 years old Weaknesses Fragmented market Me too product Charity is medium size so not receiving enough share of donations 1700 services what is core competence?
Opportunities International exposure especially in research Could merge/form partnership with other charities Licensing products Raise awareness and get momentum like Cancer Research did Gift aid awareness if more donors claimed could significantly increase charity income Utilise National Dementia Strategy and align Winning NICE appeal Threats Crowded marketplace very competitive Barriers to switching charity is low Recession impacting donations Loyalty of donors is questionable People will need to fund their own care/pensions so may impact legacy income/large donations Legacy income expected to fall (currently 38) Losing NICE appeal

Figure 10 Ansoff Matrix
Existing products New products
Market penetration strategy Product development strategy
Existing markets Need to drive increased revenue from existing donors across all product categories high net worth individuals, groups, companies and organisations Form partnerships with similar charities Develop new products e.g internal audit function for other charities, Franchising branded products. Develop licensing and patenting products e.g Brain games to help prevent onset.
New markets Market development strategy Diversification strategy
New markets New distribution channels additional online development blogs, social networking, increase direct debits. Develop compelling messages- shock tactics, Use cinema, television, celebrity culture. Consider different approach such as providing consultancy services for new charities
Figure 11. Business Portfolio Matrix (Harrell
Keifer (1993))
Country attractiveness Country attractiveness Country attractiveness
High Medium Low
ALZ compatibility with each country High Italy Germany France Sweden USA
ALZ compatibility with each country Medium Spain Japan
ALZ compatibility with each country Low
Italy has largest oldest population though pays
the least. Sweden/Scandinavian countries spends
the most on LTC. ADI has an annual conference
opportunity to expand/grow presence. Germany,
France, USA spend more on research than UK
Figure 12. Balanced Scorecard
Objectives Measures
Financial Donations in each country UK, ROI overseas Return on capital Cash flow Profitability Donor lifetime value Effectiveness of services offered Sales vs targets in each sector ROCE Cash flow Net margin Donor LV calculation Return/take up per service
Internal CRM database Penetrate new donors Increase value from existing donors Increase website traffic Increase education Control costs No of donors on database and change (new) Value of donations from new donors Increase in existing donations Income per donor Number of website hits/hits on knowledge centre Frequency of donations Donor acquisition /retention costs
Customer Value for money donor satisfaction Donor loyalty Donor endorsements Brand awareness Donor satisfaction and perception surveys Donor retention levels Web based Level of brand recall Market share
Learning Innovation Innovate ways of targeting new donors Empowered workforce Return per campaign No of new campaigns offered/ROI Staff attitude surveys Advertising as donations Marketing spend per donor

Figure 13 Loyalty Ladder
Loyalty Ladder
Value Ladder
Price To create sustainable comp adv, and max.
donations , long term relationships must be
cultivated. By moving donors up the value /
loyalty ladder, they become more loyal to this
charity. This can be achieved through social
marketing message driven, change
behaviours. Advocates will act as ambassadors and
help actively promote charity recruiting new
Believe the cause willing to invest time/effort
Partner/ champion
Customise web page, personal thank you messages,
Start to want to do more
Advocate/ member
Offer more social, personal (emails, news
Added Value
Provide methods for donor feedback/give
time/increase donations Perhaps paying by DD as
more loyal customer
Fund raising
Supporter/ volunteer
Buys the message
First time Donor maybe one off
Easy to donate different methods maybe cash.
  • Figure 15 ALZ Assets/Competencies
  • ALZ has a strong ethical trading stance
  • Starting to gain brand recognition
  • ALZ supports the carers as well as the sufferers
    of dementia
  • ALZ offers wide variety of ways to donate
  • Socially responsible
  • Cares about the environment- recycles clothing,
    Oxfam/MS scheme

Awareness of charity
Knowledge of charity
Knowledge of ALZ illness
Awareness of illness

Figure 14 Critical Success Factors
  • Maintaining a good reputation
  • Moving dementia up the government agenda and
    therefore the public agenda
  • Making it easy to donate e.g text, red button,

Figure 16. Segmentation, Targeting and Positioning
Segmentation Similar companies /affinities where synergies e.g financial service companies, SAGA, care homes, retirement homes, garden centres, post office Be aware of grants available and large fund raising opportunities Links to gyms for prevention healthy mind/body Developed society/more affluent ABC female age 65 Time rich community minded, time to donate, no family Men and women aged 30 ABC1 concerned dependents Couples aged 60 - potential carers Existing sufferers and carers Understand profile of lapsed donors and current donors and target similar segments
Targeting Work in partnership e.g Help the Aged use shops to raise awareness/identify new donors Consider campaign like Oxfam one with MS Awareness raising/donors with SAGA Link with universities/research to drive thought leadership/awareness Target and penetrate existing and new donors in the U.K. and also new markets internationally Buy database and use to target selected Segments
Positioning Socially responsible Proactively working to find a cure Leading the way in dementia research, prevention and cure Number 1 in the UK and internationally for research into and treatment of dementia related illness
Figure 17 7P Analysis
Product What is the product? Not clearly defined as offer 1700 services includes training and development. Medical research. Information services Care support services Lobbying Thought leadership Training and education for GPs. Internal audit to other charities
Price Donation channels and actual donations from individuals and companies, fundraising including initiatives such as Memory Walk. Time/resources of carers/donors, volunteers. 50 people give up time. Could use gift aid more especially with higher rate tax payers. DD most effective as locks donors in
Place Offer all channels of donations increase in payments by cheque. UK and International Opportunity to expand here. Care homes, GP surgeries, Hospitals/NHS. Website/online/chat room (127,000 messages). Opportunity to affiliate other charity shops. ALZ Café schemes
Promotion Use logo, brand and strap line in all advertising. Communications direct marketing most popular (73) (e.g forget me not campaign) but becoming less effective and 33.7 thrown away..PR /Celebrity endorsement e.g Jim Broadbent. Could target superrich? Publications/on line newsletter . More social marketing (message driven) Links to Twitter etc. Website Opportunity to do mobile marketing No adverts on TV (though expensive). ALZ awareness week, annual Memory walk, books Feelings Matter Most
People Skilled staff Donors and volunteers,
Process Staff training, customer service processes e.g staffing helpline, measuring satisfaction, fundraising processes, marketing processes, knowledge of other charities
Physical Evidence Won awards (PR Week award Coronation Street story though 2 years ago), press coverage, research papers, website, logo, merchandising, 1700 services offer
Figure 18 - Key stakeholders/partners Other
charities (Age Concern and Help the Aged),
professional and public health bodies,
pharmaceutical companies, Government, supporters,
Universities, academia, industry, international
  • Vision
  • Recognised as the leading UK and international
    charity for Alzheimers/dementia with a
    significant share/value of charitable donations
    whilst driving the international agenda in
    research, prevention, cure and improving the
    quality of life for carers and sufferers
  • Mission
  • Strengthening brand positioning as global leader
    in dementia whilst building partnerships
    internationally to aid advancement and awareness
    allowing us to leverage existing and potential
    new donors
  • Values
  • Passion Quality Integrity Inclusion Mutual
    respect plus
  • Transparency to key stakeholders
  • Ensuring donations are spent directly to benefit
    those who need it
  • Foster open and collaborative culture
  • Thought leadership
  • Dignity
  • Innovative in communications campaigns

Figure 16. Segmentation, Targeting and Positioning
Segmentation Similar companies /affinities where synergies e.g financial service companies, SAGA, care homes, retirement homes, garden centres, post office Be aware of grants available and large fund raising opportunities Links to gyms for prevention healthy mind/body Developed society ABC female age 60-65 Time rich community minded, time to donate Men and women aged 30 ABC1 concerned dependents Couples aged 60 - potential carers Existing sufferers and carers Understand profile of lapsed donors and current donors and target similar segments
Targeting Work in partnership e.g Help the Aged use shops to raise awareness/identify new donors Consider campaign like Oxfam one with MS Awareness raising/donors with SAGA Link with universities/research to drive thought leadership/awareness Target and penetrate existing and new donors in the U.K. and also new markets internationally Buy database and use to target selected Segments
Positioning Socially responsible Proactively working to find a cure Leading the way in dementia research, prevention and cure Number 1 in the UK and internationally for research into and treatment of dementia related illness
Figure 4. SWOT
  • Strategic Fit
  • Key Opportunities
  • Harness the size and flexibility of the label to
    adapt to embrace the digital era in an ethical
  • Build upon the digital capability to increase
    customer loyalty and exploit new income stream
  • Exploit current networks to contract an online
  • Use existing commercial ability to develop new
    financial models to benefit artist and label
  • Use existing infrastructure to develop strategic
    partnerships across the industry
  • Sustain multi platform / service offering to
    spread risk when considering global markets
  • Develop expertise to offer new services to the
  • Problem Zones
  • Bureaucracy can delay decision-making and lose
    momentum in a fast paced industry
  • Inertia towards technology will inhibit reaching
    and tapping into global audience
  • Artists are gaining more control and will not
    except previous terms
  • Cost focus has stifled creativity by considering
    it as a risk and market now demands creative
  • Reliance on CDs when digital is the preferred
  • Competition emerging from across the supply chain

Figure 5. Arthur D. Little Matrix
  • Recommendations
  • Although well placed to continue to serve all
    platforms, market demand indicates that label
  • Divest in vinyl
  • Harvest CDs by differentiating based on ethical
  • Invest in Digital technologies through innovation
    and quality (monitor SE Asian dev)

Figure 6. Ansoff Matrix
  • Short term
  • Increase loyalty and value by developing a CRM
  • Develop innovative new ways to engage, reach and
    delight cust.
  • Dev. new finance models to recruit and retain
    emerging bands
  • Go global
  • Long term
  • Recruit new bands to target new segments and
    spread risk
  • Widen service offering

Figure 7. Segmentation and Targeting
  • Analysis based on forecasts of market value and
    age profile of consumers (as ) from 1996-2005.
  • Overall market is declining and although the
    digital explosion has boosted the industry, it
    has not offset drop in CD sales.
  • Short term 15-24
  • Good knowledge of this sector and key to short
    term earnings
  • Eliterate and comfortable with sharing info
    through digital means
  • More impulsive buyers and easier to target
  • Develop relationship to increase lifetime value
  • Declining segment
  • Long term 40
  • Growing eliteracy but more acquired taste
  • Develop research programme to understand this
  • Evolve a proposition for this sector through
    targeted AR
  • Increasing segment so key to sustainable growth

Figure 8. Positioning
  • Differentiate
  • Innovation
  • New products and services to consumers
  • Reaching cust. via multiple comms channels
  • Develop interactive relationships (artists/cust)
  • Ethics
  • Mutually beneficial deals for artists
  • Stance against illegal piracy
  • Embrace non DRM tracks
  • Reduce carbon footprint
  • Environmentally friendly products
  • Plant a tree per co2 emissions from travel and
  • Brand Evolution
  • Label as industry brand AR
  • Artist as consumer brand Fans 15-24
  • Artist as branded brand -
  • Label as consumer brand Cross sell
  • Label develop new brands for 40 artists
  • Label as brand consultant - Diversify

Figure 9. Branding
Personality Improve quality and access to music
Values honesty, collaboration, winning, fun
Emotional Reward artist and environmentally
Rational Benefits audio stimulation
Functional benefits availability,
Figure 10. Product
  • Weaknesses
  • Generating profit
  • Access to unique identifying song codes
  • Difficult to get royalties
  • Difficult to break into charts
  • Operating at less than break even at present
  • Radio presence
  • The Furze
  • Core- Quality indie music
  • Actual- Furze brand, sleeve design, wed design,
    sales channels, platforms available
  • Augmented- interactive website, cartoon
    serialisation, comics designed, merchandise,
  • Although the band have been successful in
    creating awareness through innovative marketing,
    they have been unable to generate a significant
    ROI. Resource and expertise of a suitable label
    could propel them onto bigger things
  • Strengths
  • Successfully rebranded
  • Innovative brand name
  • Tacit knowledge- Kid G
  • Interactive website
  • Global dist. (iTunes)
  • Synchronisation - ads, films, games
  • Create awareness
  • Celebrity endorsements
  • No bank loans
  • The Label - Consumer
  • Core- Portfolio of artists
  • Actual- Individual artist brands, style of music,
    image, various channels and formats, web design,
    sleeve design
  • Augmented- CRM, merchandise, interaction with
    fans, videos, blogs, games, green, fair to
  • Opportunities
  • Relationships with fans
  • Artists more powerful
  • Existing contacts
  • Global reach of web
  • New financial models
  • Signing with label
  • Radio playlists
  • Digital platforms
  • Gigs/concerts
  • Threats
  • Low barriers to entry
  • Competition
  • Lack of resource
  • Loss of control
  • Band falls out of fashion
  • Meteoric rise could create resource problem
  • The Label - Industry
  • Core- Record, produce, distribute
  • Actual- Ability to convert lyrics into musical
    recordings. Quality of equipment, studios and
    dist network.
  • Augmented- Supporting artists, key account
    management, managing customers, promoting artist

Figure 11. Price To create sustainable comp adv,
and max. shareholder value, long term
relationships must be cultivated. By moving
customers up the value / loyalty ladder, comp and
prices sensitivity declines. Loyal cust. will
pay premium prices for innovative products and
services so to progress cust. up the ladder,
added value must be offered. With comp. and
piracy intense at the lower level, margins are
low and cost leadership strategies are
Figure 12. Promotion
  • Communications Strategy
  • Pull
  • Target consumers
  • Comms focus on product/service
  • Goal purchase (direct/indirect)
  • Push
  • Target channel intermediaries
  • Comms focus on product/service
  • Goal dev. relationships and dist. channels

  • Profile
  • Raise awareness with stakeholders
  • Project image into industry

Figure 12. Promotion (cont)
Low Involvement Decision Making Process
  • Benchmarking The Furze
  • Personal selling
  • Plugger
  • Concert / gigs / festivals
  • Advertising
  • Own website, MySpace, YouTube, iTunes
  • MTV (Kid G)
  • Radio
  • Direct Marketing

In the first instance, the challenge for labels
is to raise awareness of artists. The internet
represents a cost effective opportunity for
raising awareness through word of mouth. Social
networking sites are accessed by 150m people and
they have democratised AR. However, this must be
supported by press and media promotion to access
the mass market. Label and artist sites must be
kept updated and offer options for visitors to
sample music before buying. Point of sale
material is equally important online as it is in
retail outlets. When a purchase is made, efforts
should be made to turn the customer into a
client. By shaping attitude and developing
relationships, future intentions can be
influenced and long run behaviour can be shaped
to generate profitability.
  • PR
  • Music press (NME, Kerrang)
  • Online fanzines (Kid G)
  • Celebrity endorsements
  • Sponsorship
  • Adverts, films and games
  • Sales Promotion
  • Online videos / song samples

Figure 13. Place
  • Record stores still a key channel for full length
  • CD sales dropped 20 from peak in 1999/2000
  • Internet, digital and concerts growing channels
  • Global portable player sales120m in 2006 (43)
  • Broadband household penetration rising (Europe)
  • Digital sales doubled to 2bn in 2006 (globally)
  • 795m single track downloads in 2006 (globally)
  • 3 sell 1m music video and audio tracks a month
  • Digital format is environmentally friendlier
  • Recommended digital formats
  • Mastertone- extract from full length dig. sound
    recording looped for mob. Phones (com dist
    recording) (Fra, Esp)
  • Mobile singles (fastest growing format U.K, also
    It, Esp)
  • Online singles (UK -78 of all singles, Ger)

Figure 14. McKinsey 7 S
  • The model shows how the various aspects of the
    business relate to each other and is a useful way
    to illustrate the way culture fits into the org.
  • Soft human resource issues
  • Hard process aspects
  • When implementing strategies the label must
    focuses on BOTH hard and soft issues. Overcome
    resistance by
  • Develop market orientation
  • Project management
  • Change management
  • Internal marketing

Structure Flat, cross functional teams, empowerment
Systems Develop e-capability, continual improvement, environmentally conscious
Strategy Differentiate based on service propositions which encourage loyalty and long term profitability
Shared Values Innovative and socially responsible
Skills Train / recruit innovative staff, empathetic
Staff Embrace market led culture to capture info and satisfy needs profitably
Style Achievement, motivation and winning
Figure 15. Balanced Scorecard
  • Internal Bus. Perspective
  • AR -New artist recruitment
  • Marketing -New products / services
  • Recording/Producing -Improve quality, pro-tools
  • Procurement -Socially responsible
  • Distribution -Trees for travel
  • Innovation Learning
  • Technology -No DRM, mastertone tracks
  • Marketing -Strategic plans, CRM investment
  • Continuous improvement -Employee suggestions
  • Distribution -Increase in digital sales
  • Financial Perspective
  • Return on Capital invstd -Invest 200k per artist
  • Differential pricing -commercially priced service
  • Reliability of performance -sales forecast v
  • Customer Perspective
  • Awareness -Web hits
  • Relationship -No. registered subscribers
  • Satisfaction -Top 40 hit
  • Loyalty -Purchase behaviour

Use balanced scorecard to clarify and update
differentiation strategy based on innovation and
ethics. Comm throughout org and conduct regular
  • Characteristics of Mature Markets
  • High GDP, advanced economies, wealthy consumers
  • Higher propensity to listen to English language
  • Established music industries with multinational
  • Low rates of piracy (lt10)
  • High levels of hardware penetration, broadband
    access, etc
  • Example Germany
  • Largest Euro market for UK
  • 435,000 airplays for 320m audience
  • 3G penetration 9
  • Digital sales- 39 online single, 25 online
    album, 20 mastertone, 5 mobile single

Figure 16. International Markets
Compatibility/capability Country attractiveness/priority (3G subscribers) Country attractiveness/priority (3G subscribers) Country attractiveness/priority (3G subscribers) Country attractiveness/priority (3G subscribers)
Compatibility/capability High High Medium Low
Compatibility/capability High Mature U.K (14) USA (8) Mature Italy (24) Spain (11)
Compatibility/capability Medium Mature Germany(9) Australia (9) France (8) Canada Emerging Russia Eastern Europe
Compatibility/capability Low Mature Japan (53) South Korea (35) Emerging China India Developing Countries
Measure in terms of Suitability - Cultural fit,
Screening options and criteria Feasibility- Cash
flow, Break-even, resource, capability and
capacity Acceptability- Shareholder (esp artist),
level of risk involved potential returns.