How Non-Profit Marketing Differs from For-Profit Marketing

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  • 0:06 Marketing Has Come a Long Way
  • 1:05 For-Profit and…
  • 2:07 How the Two Compare
  • 3:06 Breaking Down the Four Ps
  • 4:33 Lesson Summary
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Lesson Transcript
Instructor: Rob Wengrzyn
For-profit and non-profit companies both have to market their products. They use the same basic vehicles and methods, but they have different methods and focuses. This lesson will describe these two very different views of marketing.

Marketing Has Come a Long Way

Let's take a moment to think about the Old West. What I want you to think about is the old snake oil salesman - that guy who would go from town to town, gather folks around and talk about how his magic elixir could cure everything from baldness to a broken leg. Now, I think it can be generally understood that these snake oil salesmen were selling basically turpentine and sugar water as a magic cure. But to them, if their product had a wide enough appeal, they could sell it to more people. Regardless of whether the product worked or not, their goal was to develop a target market as wide as the open plains.

As time progressed, marketing professionals realized the importance of segmenting out a market (developing target markets) and then focusing on selling to those segments. They would employ what we call the Four Ps of Marketing, which are price, place, product and promotion. All this planning and focus diverges a little when we compare and contrast marketing in a for-profit company with marketing in a non-profit company.

For-Profit and Non-Profit Marketing

Television, radio, print, and the Internet are part of the marketing mix
Marketing Mix Examples

When we look at marketing in the for-profit arena, the main goal is to let customers, or potential customers, know about your product with the intent of creating a sale. Thus, companies focus on how the product can benefit the customer so the customer will spend his or her money on the product. In addition, the for-profit marketer is always looking for new products and new markets to go after. An example would be McDonald's now offering higher-end coffee in its stores. They saw a market, saw a potential benefit they could provide to the customers in that market and went after it.

A non-profit organization markets the work it does or the cause it supports and is not marketing any type of specific product or service. What the non-profit is trying to do is build awareness of the issue or cause it is working for in the hopes of having individuals financially help that cause. This process is philanthropic in nature, and the person who gives money feels good about helping out a cause. That good feeling is the only thing the donor gets in return for his or her money.

How the Two Compare

Whether it is focused on for-profit or non-profit promotion, a marketing company will market a product or cause using methods such as:

  1. Marketing Mix: the different tools and methods they will use to get their message out - print, TV, radio, Web;
  2. Target Markets: the specific markets and market segments they believe they need to market to - teenage girls, ages 13-16, is a target market; single mothers with two children is a target market;
  3. Positioning: using words, symbols and ideas, this is how the company positions itself against competitors in the marketplace - they want to position themselves higher than their competitors in the minds of consumers; and
  4. Public Relations: working in the community and getting individuals to talk positively about the company or product without having to pay for it as an advertisement. Both non-profit and for-profit companies use free public relations strategies in addition to paid marketing.

Non-profits use promotion to encourage donations and involvement with their cause
Non-Profit Promotion Goals

Breaking Down the Four Ps

To take this a step further, let's break down how the Four Ps would look as they relate to these two different company types.

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