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Just because the for-profit world has customers and clients and the nonprofit world has donors and volunteers doesn’t mean that they both can’t stand to learn from one another.

Nonprofits have major gift donors, and for-profits have big spenders. Nonprofits have recurring donors, and for-profits have loyal customers. And the parallels continue.

Running an organization is running an organization, regardless of the desired outcome. To explore that, we’ve compiled a list of fundraising lessons that nonprofits can borrow from the for-profit world.

Check out these five lessons and see how they can help your organization’s fundraising!


nonprofit versus for profit fundraising


1. The customer is always right

This is one of the most popular for-profit platitudes out there. We can all recognize that platitudes often feel a bit trite, but they also reach that point because of the inherent meaning or truth at their core. “The customer is always right,” is a classic for a reason.

In the nonprofit world, we obviously don’t have customers. We do, however, have donors, and donors need to be given the same treatment and respect that a restaurant would give a customer.

You’re asking for donations from these people. You’re asking them to hand over their hard earned money. Acknowledge the financial sacrifice they are making for your organization and give them the respect they deserve.

“The customer is always right,” is less about always deferring to your customers/donors and more about prioritizing customer/donor satisfaction.

When you’re asking for contributions, you’re not in a place to demand or command. The donor is, rightly, in the power position. If your organization embraces that and lets it color your actions, you’ll see better results.

Embody the platitude!

To do so, your organization should:

  • Immediately acknowledge any gifts.
  • Be as transparent as possible regarding what gifts go towards.
  • Keep in touch with donors without always asking for more money.
  • Offer unique opportunities for engagement.
  • Thank donors for their past contributions prior to asking for another donation.

And so much more!

When in doubt, just remind yourself: “The donor is always right.”

2. Know your competition

This lesson sounds a bit fishy if you just read the tip. Competition and philanthropy aren’t terms we often pair together. And with good reason! The nonprofit world is about bringing communities and people with like-minded interests together for a common good. Competition sounds divisive.

In business, knowing your competition comes down to recognizing similar businesses in your market and leveraging your unique skills and aptitude to get ahead of them. In the nonprofit world, knowing your competition is just as relevant, but it has a different connotation.

For starters, we’re using the word “competition” loosely here. In terms of nonprofits, by “competition,” we mean organizations with similar missions and capacities.

Here’s how knowing the “competition” can kickstart your own organization’s performance:

  • You can learn from them. Who better to get inspired by than organizations in similar situations that are performing well? In this case, you’ll be studying the competition not so that you can defeat them, but so both of your organizations can better fulfill your goals. That only helps to serve your mission in the long run.
  • You can find donors. Past giving, whether to your organization or another, is a strong indicator of future giving. Once you’ve looked to your own donor pool, look outward to the pools of nonprofits similar to yours. Using donor information from sources such as a charitable giving database can help you spot prospects who might be interested in helping your cause as well.

In the nonprofit world, think of knowing your competition as akin to learning from your peers.

3. Effective marketing is a must

For-profits can’t succeed without effective marketing, and non-profits can’t either.

Learn valuable marketing lessons from the for-profit sector to make the most out of your limited time and tight budget.

If someone were to prompt you to name a great marketing campaign, you’d likely spout off the promotions from various fast food and car companies. With that in mind, think of the best advertising campaigns in recent memory and translate that formula to your nonprofit.

Traits of the best marketing campaigns include:

  • A clear message.
  • Emotionally resonant (whether it is sentimental, funny, etc.) copy.
  • A call-to-action that is easy to understand and follow.
  • A multichannel approach (direct mail, email, radio, social media, etc.) for dissemination.

An effective marketing campaign can’t be put together overnight; it’s an involved process.

According to the Small Business Administration, small businesses allocate roughly 7-8% of their revenue to marketing, whereas nonprofits usually spend a maximum of 3%. Make marketing more of a priority.

And when you start to worry about cost, remember that, thanks to the internet, there are more affordable promotional avenues like social media, email, and your website.

4. Set SMART goals

For those who don’t know, a SMART goal is defined as:

  • Specific: You won’t get anywhere with vague goals because you can’t be held accountable to them.
  • Measurable: Your goal should be trackable so that you know if you accomplished it. It falls in line with the “specific” requirement.
  • Attainable: While you want to be striving to do better, you don’t want to overshoot and end up coming up short and discouraged.
  • Relevant: Not all goals are created equal. Pick a goal that makes the most sense for the direction you’d like to see your nonprofit go.
  • Time-bound: Putting a timeline on your goal is a great way to keep your goals a priority. With no timeline, goals are often put on the backburner in favor of more seemingly urgent tasks.

Setting, working towards, and tracking goals can be a critical factor in your nonprofit’s ability to succeed.

To apply this to nonprofits, let’s run through a few sample goals and see the generic version versus the SMART version.

Sample Goal #1

Generic: This capital campaign is going to raise money to build the new library on campus.

SMART: This capital campaign needs to raise $X amount in the next three years to build the new campus library.

Sample Goal #2

Generic: This petition for our advocacy campaign will get enough signatures to get our congressman’s attention.

SMART: This petition will gather X number signatures in order to convince Congressman Y to lobby to halt Z bill.

Having the drive to make a difference in the world is different than having the discipline to turn that drive into results. SMART goals are an early step in the transition.

5. Embrace the evolving technological world

Nonprofits are following this lesson to varying degrees, but it is absolutely critical that your nonprofit gets on board with the technological opportunities available to you.

For-profit organizations tend to be more on the cutting edge of technology because those kinds of investments are easier to justify when the money you bring in is meant to be money for your organization.

When the intent of your organization is actually deemed nonprofit, it’s harder to convince yourself to spend the little additional funds you do have on new software when your old methods are working.

Here’s the thing, though. Spending a little upfront on options like new technology can save your organization in the long run.

Invest in the big stuff, like a good CRM, and then pick and choose from other technology and services available now.

For instance, if you’re fundraising for a church, text-to-give software is a convenient, modern option for tithing. Similarly, if you want participants in your annual 5K to be able to fundraise easier, you might want to look into a crowdfunding platform. The possibilities feel endless.

Hop aboard the technology train before it leaves the station with your donors and without you.

Nonprofit fundraising is its own beast. There are many differences between the nonprofit and for-profit sectors because of that fact. But, that doesn’t mean that there aren’t opportunities for the two sectors to learn from one another. Even though this article is focused on nonprofits learning from for-profits, there could just as easily be an article taking the opposite stance.

Don’t be afraid to borrow and rework for-profit lessons for your nonprofit’s benefit!


About the author:
This is a guest post by Blake Groves, Vice President at SalsaLabs, which offers online fundraising, advocacy and communications software to help nonprofits achieve their mission. Click here to read SalsaLab’s major gift guide.


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