Transcript HUD Social Enterprise Pilot

Social Enterprise Marketing
Presented by:
Sutia Kim Alter
Virtue Ventures LLC
Social Enterprise Conference
October 30-31, 2006
Social enterprise turns the
traditional social service model
on its head!
Major cultural shift from “need
and handout” to “want and buy”
Social Enterprise Conference
October 30-31, 2006
What is a Market?
Social Enterprise Conference
October 30-31, 2006
Market
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All the people who have a specific need
or want and are willing and able to
purchase service or product to satisfy
that need.
What is Marketing?
Social Enterprise Conference
October 30-31, 2006
Marketing
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Planning and executing strategies to
reach customers.
SE Marketing Considerations
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Educational marketing or outreach
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Barriers to reaching clients through traditional
marketing vehicles:
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Literacy, language, location, topography, etc.
Communications /PR efforts to educate
internal/external stakeholders impacted by SE:
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Market development
Community, donors, public, etc.
Budget and time constraints
Who pays
What are Market Forces?
Social Enterprise Conference
October 30-31, 2006
Market Forces
All things outside of your control that can
influence your enterprise:
 Weather
 Politics
 Economy
 Competition
 Infrastructure
 Suppliers & buyers
 Law
 Technology
Market Research
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Social Need & Market
Failure
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Social problem enterprise is
trying to mitigate
People impacted by social
problem
Opportunities
Barriers
Industry dynamics
Demand
Market Segments & Size
Trends
Competitors
When are you finished with
market research?
Social Enterprise Conference
October 30-31, 2006
Never….
Customers and markets are dynamic
Enterprise
Market
Need system for listening & taking action to feedback
Best way to really learn about
your market?
Social Enterprise Conference
October 30-31, 2006
Start selling something
Test market
Social Enterprise Conference
October 30-31, 2006
What Scojo learned…
Marketing Plan
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Target Market
Objectives
Marketing mix: 4 Ps
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Product
Promotion
Price
Place
Sales Plan
“I don’t know what the key to
success is, but the key to
failure is trying to please
everyone.”
- Bill Cosby
Target Market
Social Enterprise Conference
October 30-31, 2006
SE Customer can be Confusing!
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Social Enterprises have
several stakeholders
they often view as
“customers.”
Clients are
“beneficiaries” of social
enterprise services or
social impact.
Target market are those
buying social enterprise
products and services.
Market Segmentation
Social enterprises may have several customer levels
User
Purchaser
Influencer
Clinical services
(indigent)
Patient
Donor
Government
policy
Elder services
Senior
Clients’ children
Competitors
Child health
Child
Parent
Parent
Competitors
Pharmacy
Patient
Insurance
Pharma
Companies
Laboratory
services
Public Clinic
State
Government
policy
Know your customers
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Their wants
Preferences
Likes and dislikes
Habits
Lifestyle
Demographics
… ALL the things that motivate them to
make a purchasing decision
What’s in a name?
Identity
Imagine
Social Enterprise Conference
October 30-31, 2006
Your marketing message is
not your mission
Why will a customer buy your
product or service more than
once?
Social Enterprise Conference
October 30-31, 2006
Marketing message
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Should motivate customers to purchase your
product or service.
The promotional message can emphasize
particular benefits:
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A message can also exploit a market niche:
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“Convenient one-day service”
“Always fresh”
“Serving Washington Area New Mothers"
It can also be more subtle, triggering a
customer's emotions or self-image:
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“Entrusted senior care professionals”
"You deserve a break today”
“Peace of mind for you and your family”
“Baking with a difference”
All-natural bakery products from scratch. We mix
small batches of fresh, premium ingredients and
finish each product by hand to create irresistible
desserts.
Rubicon stands for more than fabulous desserts: we
are part of a nonprofit organization, Rubicon
Programs, that helps individuals in the San
Francisco Bay Area overcome economic and social
hurdles. Rubicon provides training, housing,
employment and support services to people in
need. You can feel good about buying Rubicon
products because you in turn support your
community.
Objectives linked to strategies
Objective
Marketing Strategy
Mix
Increase market share in X county
by 5% in first 1st quarter.
Introductory membership to X county
residents for 25% discount
Price
Reach 200 new families in
Vietnamese community in 2007
Launch culturally appropriate
Vietnamese language translation
clinical practice
Expand clinical services to Y & Z
rural areas including A,B, C border
towns
Introduce mobile clinical unit which
will circulate along border
Place
Increase infant immunization 25 %
among immigrants babies.
Aggressive multi-lingual campaign
using flyers, and community
information meetings to encourage
immunization.
Promotion
Product
Example: Community clinics for un/underinsured
One objective MUST be a
sales target—units and/or $
Marketing objectives are aligned
with social mission and financial
objectives
Social Enterprise Conference
October 30-31, 2006
"Cheat me on the price but
not on the goods."
— Thomas Fuller
Product Strategy
Social Enterprise Conference
October 30-31, 2006
Product Market Matrix
Existing Product Existing Market
Income from
Social Service
Highest mission
relevance; lowest risk
Income related to
Social Service
Medium mission
relevance;
New Product Existing Market
Income from
extension
of Social Service
High mission relevance;
medium risk
Income not related to
Social Service
Low mission relevance;
High risk
medium risk
Existing Product New Market
New Product New Market
Customers buy benefits
Community Clinic
Features
Benefits
Cooperative Rural Pharmacy
Features
Benefits
Evening and
Convenient;
weekend hours reduces lost
hours
wages
Generic drugs
Economical
Sliding fee
affordable
Based in
community
Convenient;
accessible
Qualified
doctors
Quality; peace
of mind
Member
insurance
Lowers stress;
worry free
Preventative
healthcare
Higher quality
of life
Sells basic
health/hygiene
products
Healthier;
fewer illnesses
Product Lifecycle
Sales
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Differentiate
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Try
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Reinvent
or kill
Brand
Time
How does your product stack up?
The codfish lay 10,000 eggs,
The homely hen just one;
The codfish never cackles
To tell you what she's done;
And so we scorn the codfish,
And the homely hen we prize.
Which demonstrates to you and me
That it pays to advertise.
-
Toronto Globe
Promotional Strategy
Social Enterprise Conference
October 30-31, 2006
Promotional Vehicles
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Print media
Broadcast media
Direct mail
Tradeshows
Merchandising
displays
Gifts & premiums
Special offers
Billboards
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Information meetings
Public relations
Telephone directory
Brochures
Posters/Flyers
Cross-selling
Referrals
Personal sales
Informal marketing
Web
#1 Marketing Vehicle
Promotional Plan
Vehicle Reach
Product
#1
Product
#1
Fit
Frequency Cost
"When it comes time to hang the
capitalists they will compete with
each other to sell us the rope at a
lower cost." - Vladimir Lenin
Price Strategy
Social Enterprise Conference
October 30-31, 2006
“Price Ceiling”
How much will you charge?
“Price Floor”
Most common price strategy
challenge for a social
enterprise?
Social Enterprise Conference
October 30-31, 2006
Inability to pay
Social Enterprise Conference
October 30-31, 2006
Break even
Sales & Costs
Profit
Loss
0
# of Units Sold
Understand the REAL cost of
your services
income = revenue
Understand how you might be
subsidizing your price
Use subsidies wisely
Social Enterprise Conference
October 30-31, 2006
Subsidies
Profit
For biz &
program
investment
Social Subsidy
Breakeven Before
Social Costs
Enterprise Revenue
Social Expense
Breakeven
AFTER
Social Costs
Business Expense
Enterprise
Revenue
Subsidizes
Social costs
Years
Employment SE Subsidies
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Volunteer time
ED + time on SE
Wage premium
Wastage
Lower employee productivity
Time spent on employee personal
problems/social programs
Higher insurance rates
Supervisory staff (i.e. job coaches)
turn over
Time for SE fundraising
"If you can't reach your
customers you can't stay in
business."
- anonymous
Place (distribution) Strategy
Social Enterprise Conference
October 30-31, 2006
SE Distribution
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The place (distribution) strategy articulates
how you will get your products or services to
your customers.
Distribution strategy is often a key for social
enterprises that serve clients with barriers to
ACCESS:
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Markets
Healthcare
Jobs
Information
Distribution - Eyeglasses
Method/market
Rural
Mobile vans
X
“Vision Guardians”
X
Micro-entrepreneurs
X
Urban
poor
Factory
Workers
Chemist
Partner
NGOs
X
X
X
Chemists
X
Direct sales
X
X
X
X
SE Marketing Pitfalls
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Confuse marketing message and mission
Failing to assess demand
Assuming customer loyalty can be built on social good
instead of quality
Build it and they will come – failure to market
Lack of operational capacity/acumen - inability to
deliver on basics
Failure to listen to customers/watch the market &
incorporate feedback
Inappropriate marketing vehicles for reaching
customers
Confuse “payer” and “user”
Confuse clients and customers
SE Marketing Practice
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Creative/unconventional marketing approaches
Take business to clients – emphasis on distribution
Price and payment of services based on clients’ abilities
to pay or third party payer
Quality, Consistency, Reliability are king
Brand
Test market new products
Vigilant about setting price
Keep your eyes on the prize
Flexibility and responsiveness
Social benefit +
Mission leverage in other marketing