npos marketing

NPOs MarketingNPOs Marketing

Arab AcademyArab AcademyFor Science and TechnologyFor Science and TechnologyGraduate School of BusinessGraduate School of Business DBA DBA ProgramProgram

NPOs MarketingNPOs MarketingTheories & ModelsTheories & Models

Presented byPresented by::

Abir El Anwar Abir El Anwar

ContentsContents

NPOs History, Definition & RoleNPOs History, Definition & Role

Purpose of the paper Purpose of the paper

Next StepsNext Steps

NPOs ModelsNPOs Models

Marketing Theories for NPOsMarketing Theories for NPOs

6/18/2009 2 NPOs Marketing

ContentsContents

NPOs Definition, Role & MarketingNPOs Definition, Role & Marketing






Purpose of the PaperPurpose of the Paper

TheThe currentcurrent researchresearch paperpaper aimsaimsatat investigatinginvestigating NPOsNPOs marketingmarketingactivitiesactivities andand theoriestheories toto testtestoneone ofof thethe modelsmodels developeddeveloped ininoneone ofof thethe modelsmodels developeddeveloped ininthisthis arenaarena..

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DefinitionDefinition

TheoriesTheories

ModelModelData collectionData collection

& & TestTestConclusionConclusion

NPOs Marketing

ContentsContents







NPOs DefinitionNPOs Definition

According According to Hall to Hall ((19871987), a ), a nonnon--profit profit organization is defined organization is defined as a body of as a body of individuals who associate for any of individuals who associate for any of three purposes:three purposes:

22-- to perform public tasks to perform public tasks for which there is a for which there is a demand that neither the demand that neither the

11-- To perform public To perform public tasks that have been tasks that have been delegated to them delegated to them

6/18/2009 6

PurposePurpose

demand that neither the demand that neither the state nor forstate nor for--profit profit organizations are willing organizations are willing to fulfillto fulfill

delegated to them delegated to them by the state.by the state.

33-- to influence the direction to influence the direction of policy in the state, the of policy in the state, the forfor--profit sector, or other profit sector, or other NPOsNPOs

NPOs Marketing

-- FormalFormal-- PrivatePrivate-- Nonprofit DistributingNonprofit Distributing-- SelfSelf--governinggoverning-- VoluntaryVoluntary-- Serve “Public Benefit”Serve “Public Benefit”

CharacteristicsCharacteristics: : SalamonSalamon 19991999

NPOs’ RoleNPOs’ Role

�� AttractAttract resourcesresources (funds,(funds, volunteers),volunteers),

�� EstablishEstablish prioritiespriorities forfor socialsocial actionaction program,program,

�� AllocateAllocate resourcesresources toto beneficiariesbeneficiaries..

Donors & FundersDonors & Funders

Marketing’s role is to

BeneficiariesBeneficiaries

6/18/2009

Psychological, social, involve, “relief of guilt”, “the need of selfPsychological, social, involve, “relief of guilt”, “the need of self--esteem”, “concern for humanity” esteem”, “concern for humanity”

Funds, time and/or energyFunds, time and/or energy

Marketing’s role is to create and maintain

“satisfying exchanges”Kotler and Andreasen (1991) - exchange theory

FORFOR

7 NPOs Marketing

NPOs MarketingNPOs Marketing

TheThe useuse ofof marketingmarketing inin NPOsNPOs beganbegan,, andand isis tracedtracedbackback toto KotlerKotler andand Levy’sLevy’s ClassicClassic ArticleArticle..

VoluntaryVoluntary laborlabor,, differentdifferent legallegal statusstatus,, distinctivedistinctive socialsocialcharactercharacter ((BillisBillis 19931993)) andand multiplemultiple constituentsconstituents makemakeNPOsNPOs moremore complexcomplex environmentenvironment forfor MarketMarket OrientationOrientation..

19601960ss

19801980ss

SomeSome NPOsNPOs havehave successfullysuccessfully adoptedadopted “marketing“marketing

6/18/2009 8

19901990ss

NPOs Marketing

SomeSome NPOsNPOs havehave successfullysuccessfully adoptedadopted “marketing“marketingactivities”activities”,, suchsuch asas raisingraising fundsfunds usingusing directdirect mailmail &&personnelpersonnel selling,selling, creatingcreating publicpublic serviceservice announcementsannouncementsandand advertisingadvertising –– ((KotlerKotler 19961996))

SalamonSalamon ((19991999)) usedused thethe termterm ““AssociationalAssociational Revolution”Revolution”toto indicateindicate howhow marketingmarketing activitiesactivities inin NPOsNPOs evolveevolverapidlyrapidly andand affectaffect itsits organizationalorganizational performanceperformance..

End of End of 19901990ss

20002000ssSixSix empiricalempirical studiesstudies foundfound aa significantsignificant positivepositiverelationshiprelationship betweenbetween MarketMarket OrientationOrientation andand PerformancePerformanceofof NPOsNPOs towardstowards bothboth donorsdonors andand beneficiariesbeneficiaries marketsmarkets..

Social MarketingSocial Marketing

�� SinceSince firstfirst proposedproposed byby KotlerKotler && ZaltmanZaltman inin 19711971,, thethe objectiveobjectiveofof SocialSocial MarketingMarketing isis ““ChangeChange Behavior”Behavior” toto influenceinfluence thetheacceptabilityacceptability ofof socialsocial ideasideas..

�� EconomicsEconomics,, sociologysociology andand psychologypsychology contributedcontributed toto initialinitialsocialsocial marketingmarketing theoriestheories wherewhere behavioralbehavioral featuresfeatures dominateddominatedtheirtheir assumptionsassumptions..theirtheir assumptionsassumptions..

�� Recently,Recently, marketersmarketers arguedargued toto distinguishdistinguish betweenbetween theorytheory andandpracticepractice.. SocialSocial MarketingMarketing isis aa disciplinediscipline andand aa practicepractice;; theoriestheorieshelphelp understandunderstand behaviorbehavior andand practicepractice helpshelps usingusing marketingmarketingtoolstools forfor thisthis objectiveobjective..

�� AndreasenAndreasen ((19941994)) defineddefined SMSM asas “the“the applicationapplication ofofcommercialcommercial marketingmarketing technologiestechnologies toto thethe analysis,analysis, planning,planning,executionexecution andand evaluationevaluation ofof programsprograms designeddesigned toto influenceinfluence thethevoluntaryvoluntary behaviorbehavior ofof targettarget audiencesaudiences inin orderorder toto improveimprove theirtheirpersonalpersonal welfarewelfare andand thatthat ofof societysociety ofof whichwhich theythey areare aa partpart ““


ContentsContents







�� Social Marketing Theory Social Marketing Theory

��Social Cognitive TheorySocial Cognitive Theory

�� Social Norms Theory Social Norms Theory

�� Social Marketing Theory Social Marketing Theory

��Social Cognitive TheorySocial Cognitive Theory

�� Social Norms Theory Social Norms Theory

Social Social Exchange Exchange TheoryTheory

Social Social Exchange Exchange TheoryTheory

NPOs Marketing TheoriesNPOs Marketing Theories

Social Norms Social Norms TheoryTheory

Social Norms Social Norms TheoryTheory

Social Social Cognitive Cognitive TheoryTheory

Social Social Cognitive Cognitive TheoryTheory

HomansHomans ((19501950,,19611961), ), BlauBlau((19641964),), and and EmersonEmerson

))١٩٧٢١٩٧٢(

Coleman1990


BanduraBandura, , 1977197719861986

Social Exchange TheorySocial Exchange TheorySocial Exchange TheorySocial Exchange Theory

�� TheThe SocialSocial ExchangeExchange TheoryTheory waswas formallyformally advancedadvanced ininthethe latelate 19501950ss andand earlyearly 19601960ss inin thethe workwork ofof thethesociologistssociologists GeorgeGeorge HomansHomans ((19611961)) andand PeterPeter BlauBlau((19641964)) andand socialsocial psychologistspsychologists JohnJohn ThibautThibaut andandHaroldHarold KelleyKelley ((19591959))


�� ExchangeExchange theorytheory isis basedbased onon thethe premisepremise thatthat humanhumanbehaviorbehavior oror socialsocial interactioninteraction isis anan exchangeexchange ofofactivity,activity, tangibletangible andand intangible,intangible, particularlyparticularly ofofrewardsrewards andand costscosts ((HomansHomans,, 19611961))..

�� TheThe basicbasic assumptionassumption ofof exchangeexchange theorytheory isis thatthatindividualsindividuals establishestablish andand continuecontinue socialsocial relationsrelations ononthethe basisbasis ofof theirtheir expectationsexpectations thatthat suchsuch relationsrelations willwill

bebe mutuallymutually advantageousadvantageous.. ((BlauBlau,, 19641964))

Social Exchange TheorySocial Exchange Theory(Cont’d)(Cont’d)

Social Exchange TheorySocial Exchange Theory(Cont’d)(Cont’d)

1.1. BehaviorBehavior isis predicatedpredicated uponupon thethe notionnotion ofof rationalityrationality..

2.2. TheThe relationshiprelationship isis basedbased onon reciprocationreciprocation..

TheThe modelmodel thatthat emergesemerges toto explainexplain socialsocial exchangeexchange theorytheoryisis comprisedcomprised ofof fivefive centralcentral assumptionsassumptions::

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2.2. TheThe relationshiprelationship isis basedbased onon reciprocationreciprocation..

3.3. SocialSocial exchangeexchange isis basedbased onon aa justicejustice principleprinciple..

4.4. IndividualsIndividuals willwill seekseek toto maximizemaximize theirtheir gainsgains andandminimizeminimize theirtheir costscosts inin thethe exchangeexchange relationrelation..

5.5. IndividualsIndividuals participateparticipate inin aa relationshiprelationship outout ofof aasensesense ofof mutualmutual benefitbenefit ratherrather thanthan coercioncoercion..

NPOs Marketing

Social Cognitive TheorySocial Cognitive TheorySocial Cognitive TheorySocial Cognitive Theory

�� BanduraBandura’s’s socialsocial cognitivecognitive (learning)(learning) theorytheory((19771977,, 19861986)) statesstates thatthat individualsindividuals learnlearn bybywatchingwatching andand copyingcopying thethe behaviorbehavior ofof othersothersinin realreal lifelife oror iinn massmass mediamedia..


inin realreal lifelife oror iinn massmass mediamedia..

�� BehaviorBehavior isis notnot determineddetermined byby justjust intrinsicintrinsicfactorsfactors,, oror thatthat anan individualindividual isis aa productproduct ofoftheirtheir environment,environment, butbut thatthat individualsindividuals havehaveinfluenceinfluence onon whatwhat theythey dodo..

Social Cognitive TheorySocial Cognitive Theory(Cont’d)(Cont’d)

Social Cognitive TheorySocial Cognitive Theory(Cont’d)(Cont’d)

�� “Reciprocal“Reciprocal Determinism”Determinism”:: threethree factorsfactors operateoperate asasinteractinginteracting determinantsdeterminants ofof eacheach otherother

�� PersonalPersonal:: cognitive,cognitive, affectiveaffective andand biologicalbiological

�� BehavioralBehavioral :: controlcontrol ownown patternspatterns ofof behaviorbehavior

�� EnvironmentalEnvironmental:: economiceconomic conditionsconditions andand sociosocio--economiceconomicstatusstatus


statusstatus

�� FourFour mainmain processesprocesses areare amongamong thosethose thatthat governgovernobservationalobservational learninglearning::

�� AttentionAttention:: gaininggaining andand maintainingmaintaining attentionattention

�� RetentionRetention:: beingbeing rememberedremembered

�� ProductionProduction:: reproducingreproducing thethe observedobserved behaviorbehavior

�� MotivationMotivation:: beingbeing stimulatedstimulated toto produceproduce thethe behaviorbehavior

Social Norms TheorySocial Norms TheorySocial Norms TheorySocial Norms Theory

�� InformalInformal socialsocial normsnorms withwith sanctionssanctions cancan bebeexplained,explained, inin principle,principle, byby aa rationalrational choicechoice approachapproach..

�� ColemanColeman ((19901990)) andand othersothers havehave arguedargued thatthat normsnormsserveserve toto improveimprove thethe efficiencyefficiency oror thethe aggregateaggregatewelfarewelfare ofof thethe normnorm beneficiariesbeneficiaries..


welfarewelfare ofof thethe normnorm beneficiariesbeneficiaries..

�� RepeatedRepeated interactionsinteractions amongamong normnorm beneficiariesbeneficiaries helphelptoto enforceenforce normsnorms ofof cooperationcooperation..

�� ColemanColeman hashas arguedargued thatthat thethe existenceexistence ofof aa closedclosednetworknetwork ofof socialsocial relationsrelations isis importantimportant forfor thetherealizationrealization ofof normsnorms..

ContentsContents







1.1. Market Orientation & PerformanceMarket Orientation & Performance

2.2. Customer Citizenship BehaviorCustomer Citizenship Behavior

3.3. Impact of IMC on Performance Impact of IMC on Performance

& Brand Equity& Brand Equity

1.1. Market Orientation & PerformanceMarket Orientation & Performance

2.2. Customer Citizenship BehaviorCustomer Citizenship Behavior

3.3. Impact of IMC on Performance Impact of IMC on Performance

& Brand Equity& Brand Equity

First Model First Model

““MarketMarket OrientationOrientation inin thethe NonprofitNonprofit Sector”Sector”PadanyiPadanyi && GainerGainer 20042004

ModelModel 11 –– TheThe RelationshipRelationship BetweenBetween GovernmentGovernment FunderFunder OrientationOrientation

andand OrganizationalOrganizational PerformancePerformance inin thethe NonprofitNonprofit SectorSector


Market Orientation ScalesMarket Orientation Scales Performance VariablesPerformance Variables

First Model First Model –– cont’dcont’d

“Market“Market OrientationOrientation inin thethe NonprofitNonprofit Sector”Sector”PadanyiPadanyi && GainerGainer 20042004

ModelModel 22 –– TheThe RelationshipRelationship BetweenBetween ClientClient MarketMarket OrientationOrientation andand

OrganizationalOrganizational PerformancePerformance inin thethe NonprofitNonprofit SectorSector


Market Orientation ScalesMarket Orientation Scales Performance VariablesPerformance Variables


�� TheThe modelmodel focusesfocuses onon twotwo constituentconstituent groupsgroups ofof NPOsNPOs::Client/CustomersClient/Customers (resource(resource allocation)allocation) andand GovernmentGovernmentFundersFunders (resource(resource provision)provision)

�� MarketMarket OrientationOrientation isis involvinginvolving MarketMarket--orientedoriented cultureculture &&

Model Model 11: :

Market Orientation & Organizational PerformanceMarket Orientation & Organizational Performance

6/18/2009 20

�� MarketMarket OrientationOrientation isis involvinginvolving MarketMarket--orientedoriented cultureculture &&MarketMarket--orientedoriented behaviorbehavior thatthat areare independent,independent, causallycausally--relatedrelated andand affectaffect NPOsNPOs performanceperformance..

�� OrganizationalOrganizational PerformancePerformance hashas threethree dimensionsdimensions:: ““ClientClientsatisfactionsatisfaction”,”, ““ResourceResource AcquisitionAcquisition”” andand ““ReputationReputationamongamong peerspeers”” (Herman(Herman 19901990))

�� ResultsResults affirmedaffirmed thethe modelmodel relationshipsrelationships.. ItIt showsshows MOMOappliesapplies differentlydifferently inin NPOsNPOs thanthan inin ForFor--profits,profits, missionmission &&sustainabilitysustainability havehave greatergreater impactimpact thanthan resourcesresources (ROI)(ROI)..

NPOs Marketing


[ [ √√] Are concepts and propositions specified in the model?] Are concepts and propositions specified in the model?

[ [ √√] Are the concepts relevant to solving the problem at hand? ] Are the concepts relevant to solving the problem at hand?

[ [ √√] Are the principle components of the concept clearly defined?] Are the principle components of the concept clearly defined?

[ [ xx]] Is there consensus as to which concepts are relevant in Is there consensus as to which concepts are relevant in

explaining the problem?explaining the problem?

Model Evaluation Checklist:Model Evaluation Checklist:

6/18/2009 21


[ [ √√] Are the concepts properly defined and labeled?] Are the concepts properly defined and labeled?

[ [ √√] Is the concept specific enough to be operationalized reliably ] Is the concept specific enough to be operationalized reliably

and with validity?and with validity?

[ [ √√] Are assumptions made in the model clear?] Are assumptions made in the model clear?

[ [ √√] Are the limitations of the model stated?] Are the limitations of the model stated?

[ [ xx] Does the model predict?] Does the model predict?

[ [ √√] Does the model explain?] Does the model explain?

[ [ xx] Are normative guidelines given for model use?] Are normative guidelines given for model use?

[ [ √√] Can the model be readily quantified?] Can the model be readily quantified?

[ [ √√] Are the outcomes of the model supported by common sense? ] Are the outcomes of the model supported by common sense?

NPOs Marketing

Second Model Second Model

ModelModel 22 –– ResearchResearch ModelModel ofof CCBCCB forfor MediumMedium--HighHigh ContactContact ServicesServices

“Customer“Customer CitizenshipCitizenship BehaviorBehavior inin ServicesServices OrganizationsOrganizations::

AA socialsocial ExchangeExchange Model”Model” –– Patterson,Patterson, RazzaqueRazzaque && ChongChong SheeShee


Second Model Second Model –– cont’dcont’d

�� CCBCCB defineddefined asas representingrepresenting individualindividual discretionarydiscretionary behaviorbehaviorthatthat isis notnot directlydirectly oror explicitlyexplicitly recognizedrecognized byby thethe formalformalrewardreward systemsystem butbut promotespromotes organization’sorganization’s functioningfunctioning..

�� AA theoreticaltheoretical supportsupport forfor aa linklink betweenbetween CustomerCustomer satisfactionsatisfaction

Model Model 22: :

“Customer“Customer CitizenshipCitizenship BehaviorBehavior inin ServicesServices OrganizationsOrganizations::AA socialsocial ExchangeExchange Model”Model”


�� AA theoreticaltheoretical supportsupport forfor aa linklink betweenbetween CustomerCustomer satisfactionsatisfactionandand CCBCCB isis providedprovided byby SocialSocial ExchangeExchange TheoryTheory ..

�� TheThe modelmodel suggestssuggests 44 propositionspropositions:: PositivePositive relationshiprelationship ofofAC,AC, PersonalityPersonality andand PerceivedPerceived OrganizationalOrganizational JusticeJustice withwith CCBCCBwithwith aa mediatingmediating variablevariable “Customer“Customer Loyalty”Loyalty” andand “time“timepressurepressure asas moderatingmoderating variablevariable..

�� TheThe modelmodel fulfillsfulfills aa gapgap inin MarketingMarketing LiteratureLiterature andand callscalls forforempiricalempirical teststests inin variousvarious NPOsNPOs servicesservices organizationsorganizations..

Second Model Second Model –– cont’dcont’d







6/18/2009 24



[ [ xx] Is the concept specific enough to be operationalized reliably ] Is the concept specific enough to be operationalized reliably


[ [ √√] Are assumptions made in the model clear?] Are assumptions made in the model clear?





[ ] Can the model be readily quantified?[ ] Can the model be readily quantified?

[ ] Are the outcomes of the model supported by common sense? [ ] Are the outcomes of the model supported by common sense?

NPOs Marketing

Third Model Third Model

“Model“Model ofof relationshiprelationship betweenbetween IMC,IMC, PerformancePerformance andand BrandBrandequityequity inin NPOs”NPOs” –– DuncanDuncan && MoriartyMoriarty ((19981998),), AakerAaker ((19961996))


Third Model Third Model –– cont’dcont’d

“Model“Model ofof relationshiprelationship betweenbetween IMC,IMC, PerformancePerformance andand BrandBrandequityequity inin NPOs”NPOs” –– DuncanDuncan && MoriartyMoriarty ((19981998),), AakerAaker ((19961996))

IntegratedIntegrated MarketingMarketing CommunicationCommunication --IMCIMC isis::

“attempting“attempting toto influenceinfluence thethe subjectivesubjective cognitioncognition ofof“attempting“attempting toto influenceinfluence thethe subjectivesubjective cognitioncognition ofofconsumersconsumers;; throughthrough strategicstrategic managementmanagementmarketingmarketing communication,communication, conveyingconveying consistentconsistentinformationinformation fromfrom thethe outsideoutside toto thethe inside,inside,enhancingenhancing brandbrand imagingimaging andand improvingimprovingcustomercustomer relationsrelations..”” SchultzSchultz ((19971997))



�� BrandBrand valuevalueIsIs aa resultresult variable,variable, referringreferring toto thethe fourfour elementselements ofof AakerAaker((19961996)),, includingincluding brandbrand loyalty,loyalty, brandbrand popularity,popularity,consciousnessconsciousness qualityquality andand brandbrand associationassociation

�� InternalInternal processingprocessing performanceperformance�� InternalInternal processingprocessing performanceperformanceProcessProcess controlcontrol:: mediamedia variable,variable, referringreferring toto thethe fivefiveelementselements ofof DuncanDuncan andand MoriartyMoriarty ((19971997)),, includingincludingconsistency,consistency, interaction,interaction, mission,mission, basicbasic organizationorganization andandplanplan evaluation,evaluation,

�� ExternalExternal communicationcommunication instrumentinstrumentTechnicalTechnical levellevel:: TheThe fivefive elementselements ofof DuncanDuncan andand MoriartyMoriarty((19981998)) includingincluding advertisement,advertisement, salessales promotion,promotion, directdirectsalesale andand publicpublic relations,relations,



Findings of using IMC model to evaluate the impacts of Findings of using IMC model to evaluate the impacts of brand operation on the performance NPOs brand operation on the performance NPOs

�� IMCIMC posesposes aa significantsignificant positivepositive impactimpact toto bothboth “technical“technicallevel”level” andand performanceperformance ofof “process“process control”control”

�� BetterBetter effectseffects insideinside thethe NPONPO cancan bebe obtainedobtained ifif thethecommunicationcommunication instrumentsinstruments ofof IMCIMC areare integratedintegrated moremore

�� BetterBetter effectseffects insideinside thethe NPONPO cancan bebe obtainedobtained ifif thethecommunicationcommunication instrumentsinstruments ofof IMCIMC areare integratedintegrated moremoreeffectivelyeffectively..

�� ThereThere isis aa significantsignificant positivepositive impactimpact ofof IMCIMC “technical“technicallevel”level” onon thethe “brand“brand equity”equity”

�� CommunicationCommunication instrumentsinstruments createcreate brandbrand valuesvalues forfor NPONPOonlyonly viavia internalinternal integrationintegration ofof thethe organizationorganization..

�� “Process“Process control”control” hashas aa significantsignificant impactimpact onon “brand“brand equity”,equity”,

�� internalinternal IMCIMC integrationintegration conducesconduces toto thethe brandbrand constructionconstruction


Third ModelThird Model–– cont’dcont’d







6/18/2009 29



[ [ √√] Is the concept specific enough to be operationalized reliably ] Is the concept specific enough to be operationalized reliably


[ ] Are assumptions made in the model clear?[ ] Are assumptions made in the model clear?





[ [ √√] Can the model be readily quantified?] Can the model be readily quantified?

[ [ √√] Are the outcomes of the model supported by common sense? ] Are the outcomes of the model supported by common sense?

NPOs Marketing

ReferencesReferences

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BerndBernd Helmig,Helmig, MarcMarc Jegers,Jegers, andand IrvineIrvine Lapsley,Lapsley, ""ChallengesChallenges inin ManagingManaging NonprofitNonprofitOrganizationsOrganizations:: AA ResearchResearch OverviewOverview Voluntas",Voluntas", InternationalInternational JournalJournal ofof VoluntaryVoluntary andandNonprofitNonprofit OrganizationsOrganizations,, ((JuneJune 20042004))

Duncan,Duncan, TT.. && MoriartyMoriarty.. S,S, “A“A CommunicationCommunication--BasedBased MarketingMarketing ModelModel forfor ManagingManagingRelationships”Relationships”,, JournalJournalofof MarketingMarketing,, ((19981998))..Relationships”Relationships”,, JournalJournalofof MarketingMarketing,, ((19981998))..

Hall,Hall, PP..D,D,““ AA historicalhistorical overviewoverview ofof thethe privateprivate nonnon--profitprofit sector”,sector”,inin Powell,Powell, WW..WW.. (Ed(Ed..),),TheThe NonNon--profitprofit SectorSector:: AA ResearchResearch HandbookHandbook,, YaleYale UniversityUniversity Press,Press, LondonLondon ((19871987))..

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