4 Lessons That Nonprofits Can Teach Entrepreneurs
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Nonprofits are often perceived as being less businesslike and bottom-line driven than their for-profit counterparts. But in reality, there’s no better model for learning how to cultivate passionate and loyal “customers.” Nonprofits are masters of engagement, often finding creative ways to do more with less. They also know how to spur their constituents to action, grow their support base and maintain those supporters for life.
So, whether your startup sells tacos or technology, your business may have more in common with nonprofits than you realize, how can nonprofits make your business better? Start with these four lessons about marketing your product.
1. Nail the value proposition
Best-in-class nonprofits make sure their donors can easily wrap their heads around where their money is going and what they will get for it. They really understand how to make their message resonate with their audience. Think about how powerful and effective the “for the price of a cup of coffee, you can feed one child” value proposition is. It brings us to a place of great perspective, motivates us and, in the simplest and most related way, illustrates the amazing impact one person can make.
Entrepreneurs, on the other hand, have a tendency to get too focused on product specs and features, and their messaging ends up in the weeds. I’m not saying you should ditch the product-punch list; but, instead, add a value element to it. This actually serves two goals. First, it forces you to you to define and promote the three-to-five key value messages that really resonate with customers.
Then, you can audit your own marketing and sales efforts to make sure the messages are being used in every available channel, from the website to sales scripts. By putting solutions in context and highlighting customer-oriented outcomes, entrepreneurs can deliver an equally effective, succinct and clear value to the market.
2. Research your constituents, not just your market.
Budgets are always an issue for nonprofits. Their lack of deep pockets often forces them to be more creative, wily and buttoned up. It also means they can’t afford to miss the mark when it comes to understanding their audiences.
Market research is just as important for nonprofits as for any other business -- it’s the best way to understand what motivates their constituents, what needs they should serve and how they’re doing. Even large nonprofits such as United Way regularly check in to see which causes are most important to donors and volunteers, so they can market accordingly. Some of the organization’s recent research, for example, revealed that education is a top philanthropic priority for women, and guided them toward partnerships with local schools.
Even if you’re a budget-starved business, you can borrow a lesson from lean nonprofits by pairing free or low-cost quantitative tools such as Survey Monkey or Google Consumer Surveys with high-quality analysis or qualitative follow-up.
You can also form a customer advisory panel and solicit members' research. Just don’t forego research altogether because best guesses can quickly lead you down a costly wrong path.
3. Use emotion to tell your story.
Nonprofits are renowned for humanizing stories and using emotive messaging and language to reach their constituents. The people, cause or issue takes center stage, and the organization follows. These organizations also never let you forget that there are people involved.
They keep their beneficiaries and benefactors out in front, making personal, memorable connections and invite individuals to share their own stories and images as a part of their campaigns. For example, the American Heart Association and American Stroke Association ask users to share their reasons “to live a healthier, longer life” by tagging social posts with #LifeIsWhy.
Even if your product or service doesn’t feel inherently emotional, embrace emotion as a marketing asset. Think about why you got into business in the first place, or why your first customer signed on. Maybe you are passionate about solving a problem no one in your industry had addressed, or your company found an unprecedented way to serve customers.
Stop talking about features and benefits, and message around the relatable emotion behind the problem, cost or pain that your solution addresses.
Then, start making and celebrating those emotional connections. Infuse human elements into your reporting and sales strategy. Take your buyer personas and case studies to a new level by centering on the “why” behind their motivations, inspirations and actions. Nonprofits nail this strategy, but so do several well known corporate brands that operate in the most mundane of categories, including UPS and Salesforce.
4. Create a clear and compelling call to action.
While nonprofit branding initiatives do exist, when they put energy into promoting their cause, you can expect a clear and timely “ask.” Every entrepreneur should have clear-cut calls to action for each target audience and make sure the entire company is trained on them.
Startups operating in emerging spaces, in particular, can’t rely on prospects to know what to do next, how to engage or even what to buy. They also can’t rely on the power of their brand to sell for them. They need to put forth a call to action that convinces prospects to take some type of immediate action.
How to get there? Sit down with your internal team and map out the actions you want your key audiences to take and the optimal touch-points to drive responses. Depending on the complexity of your solution, there may be more than one desired response, or even a series of outcomes that ultimately generate results for your brand.
The Red Cross engages both the donor and the recipient, pairing prominently placed calls to action such as “Donate Funds” and “Donate Blood” with other activities, such as training and “Get Assistance.” Use split tests to determine which call to action for your product or service is most effective.
Nonprofits and startups share many traits, including a need to creatively and efficiently market to maintain lifetime customer loyalty. Is your company implementing any practices born in the nonprofit world that should be added to this list?