What is a not for profit organization
A not-for-profit organization is one that does not intend that its sole purpose is to deliver profitability. But it is important to remember that a not-for-profit organization will typically generate a profit which is then reinvested into the organization in order to achieve growth or to increase the impact that the organization has in the world.
Not for-profit firms, because they have certain goals that they seek to achieve, will be engaged in an array of marketing activities and possibly have full-time marketing staff in their employment.
In simple terms, not-for-profit organizations utilize marketing in order to broaden their reach and impact in their community – and in some cases, help generate revenue and donations for the organization.
Public or private?
Not-for-profit organizations can be found both in the public and private sectors. The public sector organizations may some of their funds through tax revenues and some may also benefit from political control. Whereas, in the private sector, the organizations may rely upon donations, and be controlled by their members and patrons, or be depended upon user-fees.
The scope of not-for-profit organisations that are involved in marketing can include:
- People: politicians, entertainers and so on;
- Organizations: universities, museums, charitable groups and so on;
- Places: convention centers, social centers and so on;
- Ideas: anti-smoking, safe driving and so on;
In summary, not-for-profit firms will engage engage in marketing activities for the following reasons:
- To identify their target groups and achieve a better understanding of their needs, wants or desires;
- To compete effectively in their own market;
- To become able to adapt to changes in social trends or human behavior;
- To respond effectively to the demands of their public, customers or constituents.
Differences between for-profit marketing and not-for-profit marketing
- A not-for-profit organization promotes its activity or the cause it stands for, instead of its products or services.
- In a not-for-profit organization the main scope of the marketing activity is to raise awareness for a certain issue and gain the necessary financial support from the public. In this case, marketing encourages individuals to give instead of buy.
Similarities between for-profit marketing and not-for-profit marketing
- Both for-profit and not-for-profit organizations use the same marketing methods to identify the target market, to position themselves in the minds of their public, to build a strong brand and to promote their activity.
- They both need to conduct a market research before engaging in any marketing strategy.
- Both use similar advertising methods: online, print, television, radio and so on.
- Both need to establish a strong and positive image of their organizations. To this purpose, they use the same tools to build positive associations and establish a good reputation in their field of activity.