The State of Marketing in the Public and Non-Profit Sectors

2. The State of Marketing in the Public and Non-Profit Sectors Jim Mintz, Director Centre of Excellence for Public Sector Marketing

3. Centre of Excellence for Public Sector Marketing (CEPSM) Our Mission • To advance the marketing discipline in the public sector. Our Mandate • To provide a focal point for public sector marketing expertise that will encourage and support innovation in marketing, communications and delivery of services to Canadians, while instilling pride in the field of public sector marketing.

4. Centre of Excellence for Public Sector Marketing (CEPSM) Professional Development and Training • Workshops, courses (Professional Certificate In Public and Non-Profit Marketing) Ottawa/Toronto • In-house training and coaching Professional Advice and Coaching • Strategic marketing planning/research & marketing performance measurement • Revenue/cost recovery strategies and marketing best practices assessments/audits and human resource management (marketing) • Strategic marketing for web and interactive products • Partnership/strategic alliance strategies with private and other sectors Tools and Resources • Web-based information/tools/resources/speakers for conferences www.publicsectormarketing.ca

5. CEPSM Clients

6. Setting the Scene • Long-standing debate about the relevance of marketing to the public sector and, to a lesser extent, the non-profit sector, e.g. • Marketing implies economic choice, which does not always apply to government or non-profit situations • The concept of democracy does not lend itself to influencing attitudes and changing behaviour (as opposed to responding to the unfiltered demands of citizens) • These notions have now been dismissed as overly simplistic given the range and complexity of government and non-profit activities

7. Setting the Scene • Initial resistance and lack of perceived applicability gave marketing a late start; however, it has now been recognized that there are qualified applications of marketing that can make a significant impact. • Social marketing can help to change attitudes, values and behaviour for the collective well-being • Strategic marketing, segmentation and other concepts can be applied to improve the impact of programs and services • Marketing techniques can be used to help make better resource trade-off decisions • For fee-based products and services (including fundraising), product marketing concepts can be used to improve uptake

8. Setting the Scene • Important to advance good marketing practices within both the public and non profit sectors • The purpose of the “State of Marketing” survey was to do exactly that: • It can be used as a benchmark to determine the marketing health of public and non-profit organizations • It can be used to identify specific training and development initiatives to effect improvement • It can be used to gauge the success of these interventions • A concerted effort to improve the state of marketing can have a positive impact on employees, citizens, stakeholders

9. The Nuts and Bolts of the Study • Online survey of 575 people in marketing-related positions in government and non-profit organizations across Canada • Email invitation with one follow-up to a list of approximately 6,000 people in government and non-profit organizations (identified as being in marketing-related positions) • Response rate was 10% (over 600 began the survey)

10. The Nuts and Bolts of the Study • Respondents rated their organization based on agreement or disagreement (5 point Likert scale) with 72 statements related to different aspects of marketing • Statements were based on an extensive literature review to identify best practices and characteristics of marketing organizations • Definitions were included to ensure common understanding of key concepts, terminology

11. The Nuts and Bolts of the Study • Using an analytical technique called factor analysis, the 72 measures were condensed into 8 underlying constructs that can be used assess the marketing health of organizations in the public and non-profit sectors. These are: • Marketing Information and Measurement • Planning • Culture • Management • Knowledge and Skills • Organization • Outputs/Results • Resources

12. The Nuts and Bolts of the Study • Performance indices were developed by averaging the scores on the individual measures included in each construct and then converting the scores to a 100-point scale • 100 = all individual measures received a rating of 5 out of 5, indicating strong agreement • 75 = average rating of 4 out of 5, where 4 indicates some measure of agreement • 50 = average rating of 3 out of 5, where 3 indicates that they neither agreed nor disagreed • 25 = average rating on all individual measures of 2 out of 5, indicating some disagreement • 0 = all individual measures received a rating of 1 out of 5, indicating strong disagreement

13. The State of Marketing

14. Behind the NumbersCulture “The concept of marketing, or social marketing for that matter, is not really part of the lexicon in this department.” “We seem to take one step forward and then two steps back every time there’s a change in the government environment.” “The department doesn’t know or want to know how marketing fits into initiatives because it sounds too pro-business and non-governmental.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

15. Behind the NumbersCulture “Marketing here is governed by a centralized communications department that finds marketing to be a foreign concept.” “Historically, marketing and communications were considered synonymous. Only recently have we started to recognize the difference.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

16. Behind the NumbersCulture “We do not have an overall marketing plan. Each program has a plan if it is appropriate and each program is funded in this way. As an NPO, we do not have the resources for a marketing position. As well, we do not market the organization, but specific programs.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

17. Behind the NumbersCulture “I would like to see a coordinated effort between what we call project leaders and marketing communications. Instead of marketing products or services based on internal political thrusts, look at what people actually need, built it, market it and continually serve these clients to meet their needs.” “My organization seems to put no value on marketing or feel they don’t need it. We use marketing and communications in a reactive manner.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

18. Behind the NumbersCulture “Often in smaller municipalities, there are no designated staff for marketing, and only limited direct marketing resources. Marketing is either shared by several staff or only part of one staff member’s responsibilities. And, this staff member has usually evolved into the role and may not have formal education in marketing.” “Marketing is not respected by colleagues. Economists have much more “cachet”.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

19. Behind the NumbersMarketing Information & Measurement “Our organization has a long history of developing products and services and subsequently delivering them to Canadians with the misconceived idea that they are the correct products and services. We have done an abysmal job of determining what clients want.”

20. Behind the NumbersMarketing Information & Measurement “While this organization does undertake marketing related to events and membership, there is no budget nor will (from upper management) to measure success of our efforts, which is essential to any plan.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

21. Behind the NumbersResources “As a non-profit organization, the resources available for marketing are extremely limited. There are huge expectations from government partners to undertake marketing activities, but very few resources allowed to do so. Government partners also have difficulty understanding that marketing tools need not be flashy or expensive to have impact.” “The public sector does not generally recognize and value the marketing function, so it is usually under-staffed and under-funded. With the lack of dollars, the marketing function then under-delivers.” “The marketing budget and activities are very dependent on funds raised from government and business, and it varies from year to year. This makes it difficult to retain staff. Without staff, it is difficult to develop and follow a marketing strategy.” * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

22. Behind the NumbersResults & Outputs * Numbers represent mean score on a 5 point scale, where 1 means strongly disagree and 5 means strongly agree

23. Key Findings • Overall, professionals involved in marketing gave their organizations a low overall score across all of the factors deemed to be important for successful marketing. In particular, lower ratings were given to resources, marketing information and measurement, knowledge and skills, and planning. • Although non-profit organizations tend to score higher on all indices, the study paints a bleak picture of the overall marketing health of these two sectors. Government, in particular, seem to lack the culture, strategic planning environment, management systems, knowledge and skill set, marketing information and performance measurement regime that are indicative of market-centred organizations.

24. Key Findings • Analysis by level of government suggests that crown corporations and provincial / municipal government organizations demonstrate a stronger orientation towards marketing compared to the federal government. • Within the government sector, a higher proportion of provincial and municipal government organizations scored better on the culture index compared to federal government organizations. • In comparison to government, non-profits exhibited an organizational culture that was more focused on offering value and service.

25. Key Findings • Both government and non-profits demonstrated particular neglect for incorporating a formal marketing planning process and establishing measurable marketing objectives at the organizational level. • Public sector organizations fail to consider client needs when developing service approaches and product/program/service offerings. Governments, scored low on implementing a proactive process that considers client needs when identifying and developing new products/programs/services,

26. Key Findings • The performance of both government and non-profits on knowledge and skills of marketing indicates that, while some organizations display a willingness to provide the necessary skills, they do not necessarily back up this promise in terms of organizational support and culture. • Marketing professionals in both the government and non-profits noted that their organizations were particularly poor performers when it comes to rewarding staff for achieving marketing objectives or improving value delivered to clients.

27. Key Findings • Government and non-profit organizations do not effectively use market research and other lines of evidence to gather information to support their marketing function. • Government and non-profit organizations tend to be reactive, rather than have proactive systems in place to address shifts in the marketplace. • Marketing within both government and non-profit organizations tends to be managed in silos (based on program or operational units),

28. Key Findings • A majority of respondents indicated that marketing planning will be a priority area of focus for their organization in the coming year. • Marketing professionals from non-profit organizations expected service quality and client relationship management to be a priority in the coming year, while government organizations will place some priority on managing service delivery channels.

29. Implications and Directions • Need to educate senior managers in government and non profits about value and applicability of marketing i.e. potential impact on effectiveness/efficiency of programs, and services as well as benefit to citizens. • Wide recognition of the role and value of the communications function in both government and non profits. Opportunity to broaden this function to include a strategic marketing mandate thereby re-positioning it as an expanded role. Viewing communications within a broader strategic marketing framework will help to drive results in program uptake, program impact and behavioural change.

30. Implications and Directions • Marketing does not occupy an institutionalized position. No clear marketing function or job category and few positions include “marketing” in their titles. Need to look at process for hiring marketing personnel and assigning responsibility for marketing to senior manager • Need to examine the process used to develop and manage client-centred products, programs and services. • Marketing management systems and practices must be adopted from the planning level on down. • Measurement systems must be put in place to track success against marketing objectives and make necessary adjustments to improve performance.

31. Implications and Directions • Many in government and non profits identify marketing with cost recovery or revenue generation. It is true that marketing can assist in these areas but it can also be a useful paradigm and more valuable for other goals of government and non profits, such as improving relationships with groups and individuals with whom the organization interacts, and serving clients better. • Most people performing marketing functions in public and non profits do not have formal training in marketing; therefore need for marketing training such as “Professional Certificate in Public Sector and Non-Profit Marketing” run by Sprott School of Business as well as keeping up to date on public sector marketing issues by attending the annual MARCOM conference in Ottawa in June.

32. Implications and Directions • Marketing can be beneficial for the following four reasons: • existing and potential clients are guaranteed to play a major role in developing and implementing a program/product/service; • all program elements are focused on behaviour change instead of settling for changes short of that goal, such as awareness; • initiatives tailored to specific segments of the market ensure efficient use of limited resources; and • the application of 4 Ps will always ensure that the campaign will move beyond just promotion. • As non profits/government continue to try to meet the challenges associated with demands for better and improved service delivery with budgetary constraints, new and different models of management need be considered. Marketing presents a comprehensive, integrated and innovative approach.

33. Order Copy of Report • www.publicsectormarketing.ca/resources_e

34. Articles on the Survey GOVERNMENT FAILS TO PICK UP MARKETING BEST PRACTICES http://www.networkedgovernment.ca/MarketingPracticesMintz THE CASE FOR MARKETING IN THE PUBLIC SECTOR http://www.optimumonline.ca/frontpage.phtml

35. Questions?

36. Our Mission: “To advance the marketing discipline in the public sector.” Jim Mintz Email: jim.mintz@publicsectormarketing.ca x18

37. Marketing “Vital Signs” Checklist Take the Test: “You know you are a marketing-driven organization when…”

38. You know you are a MarketingDriven Organization when: 1. Do not use terms like “general public” when referring to your target audience 2. “Plan” is more than a four letter word 3. All marketing activities are coordinated and integrated into an overall plan 4. You focus on results and NOT process and politics 5. Your organization takes “risks”, although ensuring they are “reasoned risks”

39. You know you are a MarketingDriven Organization when: • You do not keep doing the same things every year (Prgms, etc…) • Marketing campaigns consistently meet their goals and objectives • You take action when results are not achieved • You have a clear understanding of the needs of your target group(s) • You have a dedicated marketing budget • Your organization’s brand has value • “Reinventing the wheel” is not standard operating procedure

40. You know you are a MarketingDriven Organization when: • You value training in areas like marketing and communications • Performance measurement is something that your organization does regularly • You are up to date with the latest trends, technologies in the area of marketing and communications • Branding is more than a visual identifier • You are open to change • You see the need to understand your “competition”

41. You know you are a MarketingDriven Organization when: • Your organization is focused on “outcomes” not “ outputs” • Evidence-based decision making is in your organization’s vocabulary. • Strategic alliances/partnerships are a key component of your marketing activities • Your marketing objectives are SMART (Specific Measurable, Attainable, Realistic and Time Limited) • Your organization does not use the web as a warehouse to store information

42. You know you are a MarketingDriven Organization when: • You use all the elements of the marketing mix (4 p’s) and not just promotion • You organization believes that the ultimate objective for marketing is not education and creating awareness, but behaviour change

43. You know you are a MarketingDriven Organization when: If You Scored: • 20 – 25 You have the tools, processes and culture in place to be successful and sustainable • 15 – 19 You are on the right path, but need to examine those areas where you are weak • 10 – 14 You are most likely struggling and need to take a hard look at priorities and processes • 6 – 9 You are on the borderline of existence as an organization

44. Our Mission: “To advance the marketing discipline in the public sector.” Jim Mintz Email: jim.mintz@publicsectormarketing.ca