As some of you may know, I have the privilege of serving as a board member for Marketing & Communication for the American Diabetes Association (State of Indiana).  In a recent Strategy Planning session, we discussed ADA’s marketing needs, and the strategy we should follow – and I had a revelation about the similarities of non-profits and for-profits.

Any marketing strategy that is worth the paper it is written on deserves to have a market analysis, industry trends, SWOT analysis, competitor analysis, and and and.  Based on each of these analysis, the marketing implications for the company in questions should be taken into account.  With that said, I thought it was very interesting that an organization like the ADA that is a non-profit suffers from the same issues as a for-profit company.  Revenue.  Granted, they don’t want revenue in order to pass on to stake holders, however, they do have to have revenue in order to meet their mission which is to help educate people about Diabetes and to help fund research to Stop Diabetes.

Yet, non-prifts are still in the same boat as for-profits because revenues are dropping.  What does that mean? It means when revenue is down, non-profits feel it in every part of the organization just like a for-profit.  However, the similarities are that whether for/non profit, once revenue starts to suffer, management begins to focus on short-term goals in lieu of long term goals.  So when revenue is down, companies cut prices, and the brand suffers because of the new low-price strategy.  As a result, revenue declines. As revenue declines, management needs to stimulate sales so they cut prices.  It is a downward spiraling cycle.

And it is the same cycle that non-profits find themselves in.  Revenues are down, so donors and fund raisers have to be targeted and time is spent on this segment at the cost of spending time on event volunteers. It’s the same cycle. So both organizations have to create a marketing strategy that they can turn to in order to still raise revenue without hardselling the fact that they need sales and/or donations.

Best way to do that is usually not to cut prices in a whirlwind of panic, but rather to take a step back and examine why this situation has been created in the first place.  Is there a new competitor? Are competitors undercutting your prices? Have you had quality or customer service issues? First find the source of the problem and allocate resources to fixing it.

Then start a promotion campaign to get sales going while establishing yourself as the expert in your field. Promotions don’t always have to involve price cuts. They can include white-papers, Videos, of content that is useful for your customers.  For example, are you a whole-saler for retail florists? You can send your clients videos of latest floral designs, colors, and containers.  This is also a time when improving relationships comes into effect.  Rather than emailing because it is quick and easy (you know we all do it!), pick up the phone.  Or call your clients not because you want to sell them something, but just to ask how business is going and if you can help.

There are many things you can do before slashing prices.  What are some of the tactics you’ve used that have proven useful?

Disclaimer: This blog belongs to Sollé Coaching. The views expressed here belong to Sollé Coaching alone and do not necessarily reflect the views of the American Diabetes Association.

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