Academic journal article Management : Journal of Contemporary Management Issues

The Nonprofit Marketing Process and Fundraising Performance of Humanitarian Organizations: Empirical Analysis */Neprofitni Marketinski Proces I Ucinak Prikupljanja Sredstava Humanitarnih Organizacija: Empirijska Analiza

Academic journal article Management : Journal of Contemporary Management Issues

The Nonprofit Marketing Process and Fundraising Performance of Humanitarian Organizations: Empirical Analysis */Neprofitni Marketinski Proces I Ucinak Prikupljanja Sredstava Humanitarnih Organizacija: Empirijska Analiza

Article excerpt

1.NONPROFIT MARKETING PROCESS AND FUNDRAISING PERFORMANCE - THEORETICAL BACKGROUND

Nonprofit organizations, particularly humanitarian organizations, demonstrate the misunderstanding of the marketing concept and mostly focus on sales and promotional activities (Dolnicar and Lazarevski, 2009). Another objection to the use of marketing tools and techniques is reflected in the inadequate 'social image' of marketing, which is perceived to be an inadequate tool for the social sector, as it is primarily driven by profit motives. The marketing orientation toward research and the satisfaction of end users' needs is, often, ' conveniently' ignored, or perceived from the viewpoint of profit sector managers (Sheth and Sisodia, 2005).

The majority of nonprofit organizations are focused on their beneficiaries (users) and the satisfaction of their needs. A problem arises, if the beneficiary focus is only declarative, which is often due to the inadequate understanding of the importance of the strategic analysis, as the first step of the strategic marketing process (Andreasen and Kotler, 2008). Nonprofit organizations which implement marketing orientation are focused on all of their key stakeholders, which consequently leads to better understanding of stakeholders needs and organizations' performances (Modi, 2012).

The marketing orientation, as well as derived marketing activities, of nonprofit humanitarian organizations requires its application both to beneficiaries, and to donors, in order to avoid wasteful fundraising activities and concentrate on those, who are willing to support an organization (Sargeant and Woodliff, 2008; Srnka, Grohs and Eckler, 2003).

However, with the sudden growth of nonprofit/social sector organizations, competing for scarce resources (financial and human), the resulting competition has re-emphasized the need to target adequate stakeholder segments and establish a positioning vis-à-vis the competitors. This means that the traditional practice of emphasizing promotion and distribution in the nonprofit marketing mix becomes a 'trap' for inflexible organizations (Novatorov, 2010; Dolnicar and Lazarevski, 2009; Stater, 2009; Pope, Isely and Asamoa Tutu, 2009; Sargeant and Wymer, 2008).

Those organizations could be further limited in their management process and strategic marketing implementation, if there is a prevailing belief that a mission change would be unacceptable as it is defined in advance and cannot be changed or adapted to market needs since that would change the core of existence of nonprofit organization (Dolnicar and Lazarevski, 2009).

The last step of the strategic marketing process requires the performance to be measured and corrected (Sawhill and Williamson, 2001 ; Herman and Renz, 2004; Poister, 2003; Keating and Frumkin, 2003). This process mostly depends on organization's marketing orientation - capability to recognize, react/adapt and use all changes in organizations environment (Abdulai Mahmoud and Yusif, 2012).

There are many difficulties in measuring the success of nonprofit organizations, including the 'non-monetary character' of their performance, difficulties in assessing the mission and objectives, the multiplicity of stakeholders, etc.

However, those can be addressed by the multiple constituencies of nonprofit performance (Herman and Renz, 2004), an endeavor, which supports the notion of using the same marketing approach to address the needs of both the beneficiaries/users and donors, along with numerous other stakeholders (beneficiaries).

With regard to donors and beneficiaries, the marketing approach and planned activities should be different, but complementary. Nevertheless, author concentrates on the donor dimension of the overall nonprofit strategy and proposes a generic fundraising model and links it to the nonprofit marketing activities, which has not been done before in an adequate manner (Knowles and Gomez, 2009; Stater, 2009; Hart, 2008; Andreoni, 2006; Heinzel, 2004; Bennett, 2003). …

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