Not-for-Profit Marketing Overview

Not-for-Profit (NPO) Marketing

• Not-for-profit organizations (NPOs) are entities created and operated for charitable or socially beneficial purposes, rather than profit. They serve various functions like religious, scientific, charitable, educational, literary, health, or animal welfare.

Types of NPOs

• Religious organizations
• Educational and research organizations
• Health-related organizations
• Social welfare organizations
• Arts and culture organizations
• Business, professional, and membership organizations
• Youth development organizations
• Other types of nonprofits

Sources of Funding

• Government grants (federal, provincial, municipal)
• Donations and foundation funding
• Earnings from investments (interest)
• Membership fees or dues
• Charitable gaming (e.g., lottery)
• Individual donations
• Corporate donations
• Fundraising organizations (e.g., United Way)

Registered Charities

• Some NPOs are registered charities, meaning they are charitable organizations, public foundations, or private foundations operating solely for charitable purposes in Canada.
• They must use resources for charitable activities and have purposes falling under categories like:
  • Relief of poverty
  • Advancement of education
  • Advancement of religion
  • Other purposes benefiting the community
• Examples include: food banks, soup kitchens, low-cost housing, colleges, universities, research institutes, places of worship, missionary organizations, animal shelters, libraries, and volunteer fire departments.

Advantages of NPO Registration

• Issue official donation receipts for gifts from individuals and corporations.
• Exempt from paying income tax.
• Eligible to receive gifts from registered charities.
• Increased credibility in the community.
• Exempt from goods and services tax/harmonized sales tax (GST/HST) for many goods and services offered.

Obligations of Registered Charities

• Devote resources (funds, personnel, and property) to charitable purposes and activities.
• Maintain control over resources (funds, personnel, and property).
• File annual Form T3010 (Registered Charity Information Return) within six months of fiscal year-end.
• Meet annual spending requirements (disbursement quota).
• Keep reliable and complete books and records.
• Issue complete and accurate donation receipts.
• Maintain status as a Canadian legal entity.

NPO Statistics (2023)

• Individual donations, membership fees/dues, and provincial government grants are primary funding sources.
• Health and social services often receive funding from provincial grants.
• Smaller NPOs (0-4 employees) tend to rely on individual donations for funding.
• Larger organizations (0-100+ employees) receive more funding from provincial government grants compared to individual donations.
• Business/professional associations, unions, and sports/recreation organizations are more likely to receive funding from membership fees.
• Nonprofits without employees also rely heavily on membership fees and dues.

Board Director Distribution

• Diversity within NPO boards (gender, race, etc.) is important for enhancing perspectives, experiences, and expertise, thereby making decision-making more effective.
• Board director positions are almost always filled.

Distribution by Primary Activity (2023)

• NPO activities include sports and recreation (33.3%), religion (19.8%), grant-making/fundraising/voluntarism (8.8%), social services (8.5%), development/housing (6.9%), among others.

Organization Size

• NPO size varies significantly across Canada (0 employees, 1-4 employees, 5-19 employees, 20-99 employees, 100 or more employees).
• Largest percentage is NPOs without any staff.

Challenges of NPOs

• Lack of funds and resources
• Poor governance
• Continuous strategic planning
• Limited capacity
• Government procedures
• Customer-related challenges

Marketing Definition

• Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

Not-for-Profit Marketing

• Utilizes marketing tactics to help meet organizational goals and objectives.
• Activities include advertising, public relations, fundraising, gathering and processing information to make decisions, and interactions with governments, board members, donors, and volunteers.

Why NPOs Need Marketing

• Resonate with target publics
• Build image and reputation
• Recall organization and cause
• Attract donors and volunteers
• Differentiate from other NPOs
• Achieve long-term success

Marketing Target Groups

• Donors
• Volunteers
• Board of directors
• Government
• Partners
• Members
• Clients
• Media
• Corporations

Realities of Nonprofit Marketing

• Marketing effectiveness depends on a supportive organizational culture.
• There will always be much to do.
• Effective nonprofit marketing usually takes more time than money.
• Personal and organizational brands sometimes blend.