Market aspects Essay
The purpose of NGOs is to address many problems affecting the life of people all over the world. It is possible to distinguish between several types of nonprofits depending on their main focus: protection of human rights, promotion of peace, provision of disaster and emergency relief, addressing key social and economic problems in crisis situations etc. Thus, the nonprofit sector does not experience traditional competition similar to that in the for-profit industries. However, key 4 P’s of marketing – product (service), price, promotion and place are highly important for NGOs as well, and the competition moves from earning profit to attracting the attention of investors and fundraising.
The product of ACF International is its mission and goals, and the accomplishment of these goals. The reduction of hunger and child malnutrition all over the world can be considered as the product of ACF International in a broad sense. The “products” of the chosen organization include the actual help performed by the employees and volunteers of ACF International as well as the consequences of their actions (e.g. increased sustainability, higher effectiveness of agriculture or social sector). The mission of the organization deals with current and relevant issues which affect the well-being of the whole world, and it is possible to say that the product of ACF International is successfully developed and marketed.
For NGOs, the price of their product is their efficiency, i.e. the relation of their services and impact to the cost of these actions. For ACF International and for its competitors the pricing is rather cost-effective because these organizations spend 80-95% of their revenue on service provision, and the remaining funds are spent to the needs of NGOs. With regard to pricing, it is also possible to consider the amount of expenses spent to help an individual in these programs to compare efficiency. ACF International is the second effective compared to its three competitors (according to 2010 data) because it spent approximately €33.10 ($47.16) per person, while the best performer was Save the Children, which spent about $8.48 per child in 2010 (Table 3). Mercy Corps is also highly effective, with approximately $13.78 spent per person in 2010 (Table 3).
With regard to place and channels of distribution, the NGOs relate on potential supporters, volunteers, local and international NGOs and donators to deliver their services. The effectiveness of the delivery of services depends on the ability of the organization to establish contacts with other stakeholders and to convince the public to support them. ACF International has 10 featured partners, such as Tyco International, Gatorade, Financial Times, Captivate Network, North American Power, etc. The organization delivers its services to 43 countries and plans to expand their coverage to more countries where hunger is a significant threat.
Promotion is equally important for for-profit companies and NGOs, and the organizations have to develop innovate marketing approaches to raise public awareness. For NGOs, common means of promotion are press publications, partnerships, traditional advertising, TV and radio broadcasts, online promotion etc. For example, ACF International has recently launched a campaign for selling a board game “Duck Soup” which will also help to fundraise for “Action against hunger”. The organization issues own publications and collaborates with press (e.g. Deutsche Welle, the Financial, Reuters, China National News etc.) to promote their mission and activities.
