Chapter 5

Cause-related marketing is

becoming more and more popular as an increased number of consumers are making buying choices based on altruistic reasons.

One of the most fundamental principles related to developing the agency's initial donor and prospect list is

that the closer one is to the prospective donor, the more likely that person is to donate to the organization.

Employees are the

"people-power" of nonprofit organizations. They create and deliver the agency's programs and services and, therefore, are a critical part of the marketing mix. Attracting the best employees to an organization requires time and effort. These recruiting efforts result in marketing the agency to individuals in the field.

The second principle is

Affinity. In other words, who would likely be empathic for the mission of the agency.

The importance of identifying target markets is evident, but agencies must also know how to reach their target markets. The following tips can aid nonprofits in locating target markets:

Agencies should work from the inside out by rallying their staff. Employees are a nonprofit's greatest endorsers. Locating the nonprofit's target markets means getting the word out that the agency is looking for them. Organizations should seek interviews through a number of media outlets including community papers, radio, and TV. Searching for specialty publications that speak to the agency's mission is another way to locate target markets. Organizations can tap into these publications for contacts, get in touch with editors, and ask for their assistance. Agencies can also check business and trade publication directories. Governmental resources can also be tapped. Agencies should check with state and federal offices of human services and social work for information on resources, services, and consumers served both locally and nationwide.

Churches and civic groups are another valuable funding source.

Churches and civic groups often look for service-related group projects within their community. Contributions are usually in the form of in-kind services and goods but can also include monetary contributions.

Credible financial planners will recommend to their clients that they diversifying their portfolios

Diversifying helps clients to reduce risks by spreading money among various types of investments. This same premise holds true in regards to agencies and their funding sources. Following, are a number of funding sources to assist agencies in diversifying.

Once an agency begins to identify its potential funding sources they must effectively manage this critical information

In order to manage this information, it must first be organized. It is imperative to keep an organized database of former and prospective funding sources.

Agencies can set up sponsorship.....

Levels Levels provide corporations with an opportunity to choose levels which match their corporate giving budget while providing the level of exposure they seek.

There are common target markets that many agencies tend to pursue

These include donors, membership organizations, clients/customers, volunteers, other nonprofits, for profits, legislators and policymakers, and employees.

Another tool for agencies is the donor management system

also known as constituent management software or fundraising software. Donor management systems can do everything from managing a fundraising campaign to profiling donors. The software varies considerably in regards to cost, ranging from free to tens of thousands of dollars. An important point to consider regarding donor management systems is that agencies should be extremely careful about the information they put into the system.

Targeting volunteers can be

an ambitious undertaking especially when there are a number of other nonprofits in the area vying for the same volunteers. The volunteer market is unique and should not be overlooked or neglected.

In-kind donations

are donations in the form of goods and services, as opposed to donations in the form of monetary support.

Donors

are individuals who have already contributed to the agency or cause. They are likely to give again as past behavior is a strong predictor of future behavior.

Prospects

are individuals who have not previously donated to the organization.

Private foundations

are nonprofit, nongovernmental organizations which maintain principal funds to serve the common good. They typically award grants to nonprofit, charitable organizations.

Effectively managing funding and donor records is

critical in the overall success of a nonprofit's fundraising endeavors.

The government provides

funds for a variety of cause-related programs and services especially in areas of healthcare and social services.

A federated fund, also known as a community fund

is a cooperative enterprise which is owned and managed by the nonprofit members. Federated funds are often state- or community-wide. The purpose of federated funds is to raise capital for nonprofits by serving as contribution vehicles, where donors can direct their dollars to charities for which they care. Federated funds typically provide nonprofits with a relatively large sum of money. They are usually only available to well-established nonprofits, and as a result, smaller, newer, and more unique nonprofits may be at a disadvantage. One of the most recognizable federated funds is the United Way.

Another fundraising source is a

nonprofit's membership. Members donate money because the cause and mission of the organization is central to the members' everyday life, and it is something from which the members benefit.

Corporations and industries

often direct their giving to programs and services that benefit employees and communities where their employees live. They are more prone to contribute to nonprofits that have cause-related missions in which the corporation would like to be attached. One way in which corporations and businesses can provide support is through in-kind donations. Another way in which corporations can support nonprofit agencies is through sponsorships.

There are several types of foundations including

private or family, community, and corporate. They differ according to quantity, features, flexibility, and type.

One of the most fundamental and significant funding source is

the nonprofit's Board of Directors. When board members give, it can signal the board's commitment and gives its members a sense of investment in the agency. Nonprofits are more likely to meet a goal of 100% board giving by clearly communicating any giving expectations to prospective board members. If an agency has giving requirements, and the board member is uncomfortable with the requirement, board members should be given an opportunity to back out. Lastly, if the board has giving expectations, members should be offered alternative ways to contribute.

Once agencies develop an initial donor and prospect list

they can expand their reach by identifying a wider range of target markets.

Government sources provide funding to nonprofits through

various grants and endowments The application process is sometimes long and tedious, and the record keeping can be difficult. Applying for local funds may not be as involved as the process for applying for federal and state funds.