effective marketing for small organisations

Effective Marketing for

Small Organisations

Noam Kostucki

Who is the blue man?

Effective Marketing

Your marketing knowledge

Genius or Genius

Your marketing knowledge

Market Research for Museums

!

Will the credit crunch affect this?

Historical evidence/the context of the research

Longitudinal Outlook of Private Investment Culture

According to Arts & Business, the total amount of Private Investment (PI) in culture has been

experiencing healthy growth since 1996. Business investment has undergone various

fluctuations throughout the years, which are in many cases attributed to the unpredictable

nature of Capital Projects.

In 2001 onwards A&B included individuals and trusts and foundations as key sources of

private investment to be traced for the cultural sector. These three categories are therefore

now used for the calculation of total PI in the sector. This shows the increasing importance of

individual giving as the primary source of investment for arts organisations, which is itself

rising substantially.

0

100

200

300

400

500

600

700

Trusts & Foundations (£/millions) Individuals (£/millions)

Business (£/millions) 2008 total PI (£/millions)

Will the credit crunch affect this?

Results Defining business support/sponsorship/investment for the arts by ranking according to priorities, with 1 being the highest and 5 being the lowest.

Rank Item Rank Overall % Highest priority only %

CSR 1 24.1 23.5

Marketing 2 24.0 38.6

Staff engagement (including training and development)

3 22.7 20.9

Charitable Giving 4 18.8 11.8

Investment e.g. corporate art 5 10.3 3.9

These figures identify Corporate Social Responsibility (CSR) and Marketing as the key motivations for business investment in the arts.

With only a 0.1% difference of popularity between the two, this represents the increasing significance of sponsoring the arts as part of businesses� marketing, PR and branding strategies. Marketing has therefore caught-up with CSR, which has historically been the main purpose for business involvement with the arts

Staff engagement, including training and development, is not far down the line of priorities for businesses working closely with the arts, at 22.7%, with less than 2% difference from the first two priorities.

Considering the relative novelty of this kind of investment, it is impressive to observe how quickly it is picking up speed and creating its own niche in the investment of businesses in the arts

Charitable giving and Investment such as corporate art, rank fourth and fifth respectively, down the priorities of businesses when it comes to investing in the arts.

�� ranked the higher priority, with 38.6%, in contrast to 23.5% who chose CSR followed by 21% who prioritise staff engagement.

Page 16 Will the credit crunch affect this?

Breakdown of question according to reasons for investing (looking only at highest priority) Compared to last year investment this year will:

Increase & Same (%) Increase (%) Same (%) Decrease (%)

Marketing 81.4 20.3 61.0 18.6

CSR 83.3 16.7 66.7 16.7

Staff engagement 78.1 15.6 62.5 21.9

Charitable giving 88.9 33.3 55.6 11.1

Investment 100.0 0.0 100.0 0.0

Though fewer respondents considered investment such as corporate art as their priority for investing in the arts, they were less likely to decrease their investment this year compared to last year.

Staff engagement, seems to be in the short term, the activity most likely to suffer the most cuts this year compared to last.

0

20

40

60

80

100

120

Increase (%)

Same (%)

Decrease (%)

Individual Giving (Arts & Culture)

In 2007/08 individual giving reached a record total of £382 million in the UK. This is a staggering £236 million increase over just eight years.

Low-level giving is up to £100 but normally between £5-£10; Mid-level giving is up to £1,000, but normally it is below £500;

Around 90% of donations received by cultural organisations are low- and mid-level donations (most frequently low-level);

These donations tend to happen at the point of sale when attendees decide to round up a ticket price;

Donors who give several times throughout a year tend to give a larger overall financial donation than those who give once – the message is to get people to keep giving small amounts regularly.

Reasons around local pride and a personal connection were the most commonly cited reasons for giving to a particular organisation;

90% of donors come from the most committed art attendees – having attended the venue/organisation three or more times in the past two years;

75% of donors were engaged with the organisation in some manner from members/visitors, a friend, patron, on a mailing list, volunteers through to trustees. Low-level givers tended to be involved through things like volunteering, while mid-level donors tended to be trustees and ambassadors;

So what motivated their first ever donation? The answer is simple – being asked! Direct approaches activated 40% of first-ever donations

Many of the donors interviewed were part of the organisation’s Friends scheme, of them 47% said being Friend encouraged them to give and 43% said it made no difference;

��!��!��!��!��!��!��

� ��

��

�%)�'��"".��$)�'�()��

��

�%)��$%*��)�#��

��+�'�%��*''��)%�

#��

��!�%��)'�$(&%')

��

�%�$��

�)��'��

�%%'��")��

��'��(%$(��$�"*��

0� �)��%()(�)%%�#*��

0� ��+��$��$�&�()�$%�$��)%��%��$

0� ��,%*"�$2)��$ %.��)

� ��

��

��

�%'��'��)�#��

�-��)�%$�%��$)�'�()

��%'��$�%'#�)�%$

��

��&�'��#�((�%$

�

�%'��+�'��).�

��))�'�&*�"��)'�$(&%')

�

�%'��%'��"�'�$

��)��'�� '��(%$(��$�"*��

0� ��)�,�(�"�((��*(.�)��'�

0� (&��"�)�"!(�"��)*'�(

0� ��(%#�%$��)%��%�,�)�

0� ��))�'��")�

0� ��))�'��"�)��(��/��)%�"�)(��&�'!�$�

0� "%$��'�%&�$�$��%*'(

��#$��(��#$��(��#$��(�� (��#$��(��#$��(��#$��

��"��#��"��$$��$��#$��%#�%��"��"'��%"��$�� #$��$�#��'��"��$��"�!%��#��$$��

�$��#$��$��

��##��$��%$��$��#$��$��#��

'��"��

��$��#��'��"��

�&�"��

�,�0""��+�"5%&�&1&,+�!&0-)�6 �� "+"/�)�&+1"/"01�&+�1%"�02�'" 1�,#�1%"�*20"2*� ,))" 1&,+

��

�,*"1%&+$�1,�&+1"/"01�1%"� %&)!/"+ �� ""+��"#,/"��+!�4�+1"!�1,�$,��$�&+ �� ,/��+�"3"+1�� 1&3&16�,/�4,/(0%,- � �� 0�-�/1�,#��$/,2-�,/�1,2/ �� 1%"/�/"�0,+0 �� ,�*""1�-",-)" �� "#"/"+ "�1,�0&$%10""&+$��"&+$�,+�%,)&!�6��!�6�,21�"1

��

�+6�/"#"/"+ "0�1,��0-,+1�+",20�!" &0&,+

��

��# ��

��"�"'�&�#�$#��

��

�2�)& �)&�/�/&"0 ��

� �!"*& �)&�/�/&"0 ��

��1&,+�) �� # ��#��%� ��%��"��%� �"�!�� $

��"�"'�&�#�$#�)��"�!%��'��

�"/ "+1�$"�,#��!2)10��11"+!&+$��1�)"�01�,+"�)&�/�/6�!2/&+$�1%"�-�01��*,+1%0 ��

�/".2"+ 6�,#�3&0&10�,#�1%,0"��11"+!&+$��1�)"�01�,+"�)&�/�/6�!2/&+$�1%"�-�01��*,+1%0��1�)"�01�,+ "�-"/�4""( ��"00�,#1"+��21��1�)"�01�,+ "�-"/�*,+1% � ��"00�,#1"+��21��1�)"�01��1&*"0��6"�/ ��1&*"0��6"�/ ��

�,1�3&0&1"!�&+�-�01�6"�/ ��# ��

�� $�� $�� $��$�� $�� $��

��

�� 7#,4$%2�/5%12%!2�5)2)3/12�3/�3(%��%&&18%��42%4-�!.$��/8!,��1-/41)%2�

�!��!��"��

�!,%��

�%-!,%��

�$4,3��

��-42%4-2��

�(),$��

��-42%4-2��

�5%12%!2 � �

��-42%4-2��

��

��

�!��!��"�� %��

��

��

��

��

��

��

��

��

��

��

��

��

��

��

��

��

��

�! ��

��!��

��!��!��"��

� ��1%!2/.2�).#,4$%�

9� 3/�-%%3�0%/0,%

9� 1%&%1%.#%�3/�2)'(32%%).'"%).'��/.�(/,)$!8!�$!8�/43�%3#

9� "%%.�"%&/1%�!.$�6!.3%$�3/��'/�!'!).

9� !.8�1%&%1%.#%2�3/��20/.3!.%/42�$%#)2)/.

9� &/1�!.�%5%.3��!#3)5)38��/1�6/1+2(/0

�� !��!��#��!��

��

/�5)%6�!.�%7()")3)/. ��

�.3%1%23�).�24"*%#3��

�2�0!13�/&�!�'1/40��

�3(%1��

�(),$1%.�2�/43).'��

�(),$1%.:2��/43).'��

��!��!��!��!��!��!��

� ��

��

�%)�'��"".��$)�'�()��

��

�%)��$%*��)�#��

��+�'�%��*''��)%�

#��

��!�%��)'�$(&%')

��

�%�$��

�)��'��

�%%'��")��

��'��(%$(��$�"*��

0� �)��%()(�)%%�#*��

0� ��+��$��$�&�()�$%�$��)%��%��$

0� ��,%*"�$2)��$ %.��)

� ��

��

��

�%'��'��)�#��

�-��)�%$�%��$)�'�()

��%'��$�%'#�)�%$

��

��&�'��#�((�%$

�

�%'��+�'��).�

��))�'�&*�"��)'�$(&%')

�

�%'��%'��"�'�$

��)��'�� '��(%$(��$�"*��

0� ��)�,�(�"�((��*(.�)��'�

0� (&��"�)�"!(�"��)*'�(

0� ��(%#�%$��)%��%�,�)�

0� ��))�'��")�

0� ��))�'��"�)��(��/��)%�"�)(��&�'!�$�

0� "%$��'�%&�$�$��%*'(

A study into donor motivation

Figure 2: Distribution of low and mid-level donors

The majority of donors (nearly 70%) were low-level donors whilst another fifth (ca. 20%) were in the mid-level range. This means that the vast majority of donors (nearly 90%) are in the low- and mid-level giving ranges. Only a small percentage (10%) of respondents in the sample were high-level donors, which concurs with the findings of other charitable giving literature that a small number of large donations accounts for a large proportion of the total given.8

Large donations are, of course, � �� administration; but the notion of small organisations successfully accessing what is a very small, and highly sought after, pool of wealthy donors is perhaps unrealistic. In the arts economy the vast majority of organisations are micro and small-sized, operating at a local level to serve local and regional audiences and it could be argued that revenue from a well run small donations programme could meet financial needs in a proportionate yet effective way.

Low/mid-level donations, giving frequency and method

The survey of donors allowed for a more detailed look at donation values and how they relate to giving methods and frequency. One issue in identifying individual giving patterns with any precision is that many arts organisations have a portfolio of fundraising products. Art donors can engage through diverse products and while these are often structured (for example, a monthly or annual fee) they can also be spontaneous or responsive, the result of a prompt or an ad hoc request, for example.

An emerging pattern in this sample was that donors who give several (often very small) amounts over the year, whether this was on a regular or an occasional basis, or who invest small amounts in a portfolio of individual giving products, are more likely to achieve an overall higher level of financial contribution than those who give just once a year. In this donor sample there was an almost even

8 NCVO/CAF, UK Giving 2008. An overview of charitable giving in the UK in 2007/08, 2008

“To avoid the hassle of paperwork”£50K+, 60-64,

“Just for cash flow reasons” £50K+, 75-79,

“Can make it an equivalent to a larger donation”£15K-£20K, 35-39,

“At that level once a year is easier, just one lump sum”£10K-£15K, 65-69,

“I think it seemed more practical and we thought that from the organisation’s point of view it was better to have that lump sum and to get all the interest from it over the years”Undisclosed, 75-79,

“I would forget if it was spread out; I’d rather just pay it. It gives you a chance to reconsider at the end of the year”£10-£15K, 55-59,

For those who preferred to contribute more often, convenience was also a theme, but also allowing for unplanned giving/requests and perhaps as a (conscious) tactic to inflate the total amount contributed.“Money raised from the trips goes to the gallery” £25K-£30K, 30-34,

“Mainly because I was asked by [fundraiser] – [...] depending on what it is for I sometimes say yes [...] I am very encouraged by what I see [at the theatre] so I am very happy to give”Undisclosed, 75-79,

��

1. Create interest

2. Build relations

3. Engage

4. Reward

Engagement Spiral

How do they feel?

1. Do your research

2. Answer questions

3. Divide actions & set deadlines

4. Monitor results

5. Prepare a new plan

Noam Kostucki

Profile & Direct Email - www.about.me/noamkos

LinkedIn - www.bit.ly/noamkos

Twitter - @noamkos

http://www.about.me/noamkos

http://www.about.me/noamkos

http://www.bit.ly/noamkos

http://www.bit.ly/noamkos