Earned Income/Ventures

“What?,” you may be saying? Our job isn’t to generate revenue. We use the generous gifts and grants we receive to deliver programs, services and products to our community.

That’s what I hear from most nonprofit organizations intent on doing things the way they’ve always done them — relying on money from funders (private and government) and individual donors to sustain them.

Unfortunately, that model isn’t sustainable. And counting on a weak funding model leaves your organization vulnerable to everything from the volatile economy to the retirement of the program officer who had funded your organization for so long.

Nothing is more critical to your organization’s health than your budget. And a very effective way to stabilize your income is to earn some of it.

Here’s an example of how that can work for your organization:

  • Public Health Solutions sought to supplement grants and gifts with a more stable income source, and asked me to help develop an earned income stream for them.
  • They asked me to focus on developing a product or service within PHS’ fiscal management program, which focused on helping HIV- and AIDS-related organizations build skills in financial management.
  • I began by inventorying current programs and services, and looked for the gaps when comparing findings with our audit of  programs and services available from other sources to serve other types of organizations. What was PHS’ fiscal management program providing well to its core constituency that could fill a gap in services currently available to other types of nonprofit organizations?
  • The result: Common Cents Training — The Fastest Path to Financial Accountability for Your Organization. Since the department already provided the core of this program to its constituencies, the basic curriculum, materials and expertise was already in place. What was new was packaging it, marketing it and providing it (as a fee) to organizations outside of PHS’ traditional network.

Keep posted–I’ll be featuring earned income case studies and guidance in the months to come.

Please tell me: 1) What programs, services and/or products is your organization already providing to your core community, that you could repackage and sell to other sectors, and 2) What do you need to know about earning some income?

BTW, Public Health Services has changed its fiscal management program’s name to Nonprofit Consulting Services which leads me to believe that more earned income streams are in the works!

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Nancy Schwartz in Earned Income/Ventures | 1 comment
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How to Supplement Gifts & Grants wEarned Income Yes -- Charge for ItI’ll be joining two other communications experts — Hannah Kane from Idealist and reporter Carly Rothman from Newark’s Star Ledger (the daily newspaper) tomorrow in a panel (Nonprofits, Technology and Messaging) hosted by NJN, NJ’s public TV and radio station.

NJN is doing something really smart — building an earned income stream by marketing for-fee use of its production facilities and services to carefully-identified target audiences. That’s earned vs. unearned (income from donations and grants); a stabilizing source particularly in tough times. Always makes sense to diversify, including income-wise.

Here’s the strategy:

  • The folks at NJN are targeting nonprofits, government agencies and small biz/production centers/event planners — the folks they feel are mostly likely to need moderately-priced outside production help/facilities. Interest is there — 150 org staff members will be at tomorrow’s session.
  • They’re marketing facilities and expertise they already have — but aren’t fully needed by the station itself. Many public radio and/or TV stations do so; but not on so formalized (and effective) a basis.
  • They’re reaching out strategically to build awareness, interest AND relationships. The panel in which I’m participating is part of an open house series — one for each type of prospective customer — designed to introduce not only the facilities and services to prospects, but to build relationships and a deeper understanding of how NJN can help with their challenges.
  • They’re showing their understanding of the target audiences, and their respect for their time (and value of their contribution) by providing a free customized training component in each open house. That’s where our panel comes in.

What skills, products and/or facilities does your org have on tap and aren’t fully used by your own programs and operations? Look hard and inventory possibilities now. Winnow down the list by evaluating what fills a market need and is most feasible to deliver (e.g. of interest to audiences beyond the folks you already provides those services or products to, requires least additional work…). And go with it.

P.S. Don’t miss out on the in-depth articles, case studies and guides on fee-based services, branding, messages and more featured in the twice-monthly Getting Attention e-update. Subscribe today.

Nancy Schwartz in Earned Income/Ventures, Nancy's Speaking Gigs, Nonprofit Communications, Unique Approaches | 1 comment
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Your Org's Name Here -- Don't Miss This Incredible Nonprofit Marketing OpportunityFinally, concern about environmental impact has motivated governments and retailers to ban or discourage use of plastic bags. In some cases, paper bags are included in policies that range from charging for bags to selling recyclable or reusable bags as recently reported in The New York Times.

Last year, San Francisco banned all plastic bags that don’t easily break down. NYC retailers must offer plastic bag recycling.  And, starting in February 2008, Whole Foods will offer customers a choice between free recycled paper bags (deemed a winner by the National Resources Defense Council) and purchased reusable bags ($).

Here’s your organization’s opportunity:

  1. Green is seen almost universally as a good, and a value. No need to convince there.
  2. People still need bags, even as plastic bag bans go into effect more widely.
  3. Reusable bags are selling like mad (anecdotal, from my observations, and buying experience).
  4. Produce Your Nonprofit Here bags for sale via your org (at hugely above cost) and/or via retailers (a perfect cause marketing gig, but make sure your cut is substantial).

See some examples above, modeled by our shining star, Charlotte. Make ’em striking enough (attractive, not just serviceable) that they’ll be used again and again (and multiples purchased). Not only do you get the revenue from the purchase, you get the benefit of your bag users marketing your org as they carry the bags around town.

Here are some other creative resusable bag examples, all way more attention getting than the norm. Perhaps a breast cancer org should jump on a cause version of the "No Plastic Bags Bra," a no-hands solution storing two reusable bags in the bra cups.

Happy bagging.

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Nancy Schwartz in Earned Income/Ventures, Nonprofit Communications, Unique Approaches, Viral Marketing | 4 comments
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Part I Make the Most of Media Queries -- Talking on Goodwill DC's Marketing InnovationsI was thrilled to get an email from Marketplace reporter Andrea Gardner a few weeks ago. I’m one of Marketplace‘s 8 million loyal listeners, tuning in daily when possible.

Anyway, Andrea wanted a nonprofit marketing pro’s take on the very innovative work Goodwill of Greater Washington is doing via its DC Goodwill Fashion blog. Seems the savvy and sassy marketing team there DC were able to punch through “business as usual,” designing a great way to turn their ages-old earned income strategy on its ear. So they are re-framing used clothing as vintage/designer/collector duds, blogging about them and other fashion trends, and selling highlighted items via their ebay store.

I admire the team and the Goodwill DC board for their guts, imagination and willingness to experiment.
Great vision to engage young professional women in Goodwill to build brand, audiences and income stream; and great implementation. Challenging however to ensure audiences — these new folks, and those pre-existing — understand Goodwill’s impact in the workforce development arena.

Unfortunately, I see only a slight probability these fashionistas will become donors (of $ or clothes), volunteers or board members. And a significant possibility that long-time (read that, older) supporters might be offended by the very light-hearted approach the Goodwill  blogger takes. Goodwill fashionistas, remember that fashion is a means for increasing revenue and audiences, not an end in itself.

But back to Ms. Gardner. To tell you the truth, I haven’t had too many opportunities to be heard by 8 million listeners, and I didn’t want to miss out. So I thought through how to make the most of this opportunity — our subsequent communications and interview — just like any other marketing program I plan and execute, with fabulous results.

You can listen to or read the interview here.

All too often nonprofits, hungry for media coverage and anxious to get their two cents in, rush to respond to a media query without working through how to satisfy the journalist’s needs while capitalizing on the coverage and long-term relationship-building opportunities.

P.S. Learn how to achieve both goals (when you satisfy a journalist’s needs, you strengthen that relationship and are more likely to get a call for the next story) in Part II of How to Respond to Media Queries.

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Nancy Schwartz in Branding and Messages, Earned Income/Ventures, Media Relations and Press, Nonprofit Communications, Unique Approaches | 1 comment
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Give 1, Get 1 -- Negroponte's Powerful Nonprofit Marketing ModelFew strategies (of marketing, messaging and community engagement) have dazzled me more than those of One Laptop per Child’s (OLPC) XO Giving program.

Shaped by MIT Media Lab guru Nicholas Negroponte, OLPC aims get laptops to kids around the world — despite lack of power, money or the host of other barriers in the way. Ultimately, OLPC is striving to provide children with "new opportunities to explore, experiment and express themselves," and has developed the XO-1 laptop as a means to "learn about learning."

Now that would be a great idea even if it didn’t go any further. But Negraponte and team pushed to deliver the laptops as cheaply as possible. When government orders for XO-1–as well as the price point of $188–failed to meet expectations, Negroponte quickly modified his U.S. sales plan, launching OLPC through which XO-1 laptops will be sold at $400 per computer.

This Give 1 Get 1 program uses funds from each U.S. sale to provide a student in a developing nation with an XO-1 laptop at no cost. Its a community engagement and donation-generation strategy for the ages, and here’s why you nonprofit marketers need to listen up:

  1. The only way to get this product (which is the computer we’ve all been waiting for for our kids), is to give one. Enforced philanthropy, but it’s fun.
  2. To give and get, hopeful buyers need to sign up for an e-alert service (so OLPC grabs their contact info for future solicitations, ongoing engagement, forwarding to a friend, etc.)
  3. Only 25,000 orders will be taken for Christmas delivery, ensuring that many folks will jump on board to be one of the first. Limited editions pique interest.
  4. Kids are getting, and giving (even if via their parents), so it’s a great giving education opportunity.

The best nonprofit marketing comes from having to fix a problem. Necessity and urgency led Negroponte and his team this absolutely original, practical, story-making strategy; a fix for the records.

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Nancy Schwartz in Earned Income/Ventures, Nonprofit Communications, Unique Approaches | 1 comment
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According to the Bangor Daily News, the Maine Indian Basket Maker’s Alliance–focused on preserving and extending the art of basket making within Maine’s American Indian community–has just received a $63,000 grant from the US Department of Agriculture. Who knew that the USDA gave grants for marketing assistance?

"We’re a prominent retail business here in Old Town, and revenue from sales goes back into the organization and support a master apprenticeship program," says Alliance Executive Director Theresa Secord.

In addition supporting the tribes, the crafts also draw consumers to the region, and Secord is doing
everything she can to generate more customers and sales. Grant monies will go to:

  • Marketing efforts for the alliance and individual artists.
  • Identifying business opportunities for enhanced markets for the gallery and individual artists,including export markets.
  • Developing a best practices manual to help Alliance entrepreneurs understand the markets and art presentation procedures.

Take-homes for your nonprofit:

  • Consider ways that your organization can generate an income stream beyond grants and other funding.
  • Learn enough about business to know what help you need.
  • Look to nontraditional sources for marketing dollars (who would have thunk that the USDA funded marketing)?

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Nancy Schwartz in Earned Income/Ventures, Grants and Other Funding, Nonprofit Communications | 0 comments
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I can’t wait to share this nonprofit venture success story of Evergreen Lodge, a well-reviewed Yosemite guest lodge founded and financed to support its youth development social mission. I heard this incredible case study from REDF (a social venture fund) president Kristen Burns at the Philanthropy’s Sweet Spot forum.

Here are the details:

  • The story begins with Juma Ventures, a San Francisco-based youth development organization. Juma did a lot of stretching in 2001, including partnering with three young entrepreneurs who were REDF Fellows who aimed to blend financial and social goals in a business venture.
  • The Fellows — Lee Zimmerman, Brian Anderluh,and Dan Braun — developed their business concept and plan as entrepreneurs-in-residence at Juma Ventures in 2000-01, then launched this venture — a tourist lodge at Yosemite National Park that creates employment and training opportunities for disadvantaged youth from the Bay Area.
  • The youth program, which runs entirely behind the scenes, is financed entirely from Lodge  profits.
  • Juma partners with Evergreen Lodge by providing support and lends expertise with the youth program, and is also a minority investor.
  • The youth program is central to the business model of the Evergreen, and the owners and staff are proud to report "double bottom line" profits with business and social successes.
  • On the business side, the Lodge is "highly recommended" by Fodor’s California 2006, and is described by Frommer’s California as "the classic Yosemite experience," and has started to return capitol to its investors.
  • And the youth employees are showing successful transitions into adulthood.

Now that’s a social venture success. So often phrases such as "enterprise" and "social venture" remain abstractions. This Evergreen Lodge story brought them to life for me.

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Nancy Schwartz in Earned Income/Ventures, Nonprofit Communications | 0 comments
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I’ll be reporting out key trends that set the context for effective nonprofit marketing, and all marketing-specific news and tips, from this interesting forum. Co-sponsored by the pithy Stanford Social Innovation Review (always lots of no-charge articles on topics from venture philanthropy to messages that work) and Rockefeller Philanthropy Advisors, the program promises a "fascinating roster of entrepreneurs, grantmakers and donors speaking on possibilities for innovative solutions to social problems."

Keep posted for insights from innovators including Peter Goldmark, Director of the Climate and Air Program, Environmental Defense (leaders in effective online marketing, hard-hitting messages and powerful branding) and Kristen Burns, President of REDF which enables nonprofit organizations to run revenue-generating businesses that employ and educate at-risk individuals.

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Nancy Schwartz in Earned Income/Ventures, Nonprofit Communications, Nonprofit Marketing News, Philanthropy | 0 comments
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You can find all the building materials you need to construct or renovate a home at ReStore, the  Stockton, CA store recently opened by the San Jaoquin County chapter of Habitat for Humanity. That is, if you can find it. Racks of wallpaper, piles of tile and sinks plunked near the cash register clutter this downtown store, vastly outnumbering the far too few customers.

Habitat for Humanity boasts over 200 ReStore outlets nationwide and in Canada, all offering great prices with profits going to Habitat. Goods are donated by local businesses and builders, and many of these outlets are thriving. But despite this win-win shopping opportunity, there are far fewer sales in Stockton than Habitat leaders had hoped for, and this ReStore is struggling to stay open.

According to the The Record, the regional newspaper, local Habitat for Humanity officials say part of the problem is many residents don’t know it exists. The store occupies less than 3,000 square feet of space inside a warehouse at 2050 E. Fremont St. Not exactly inviting. And if that wasn’t challenging  enough, ReStore closed for a few months last year  due to roof leaks, and because there weren’t enough volunteer staffers, say Marilyn Field, the chapter’s president.

The Restore concept is a great one and I’m confident, now that Field and her peers have identified the issues, that they can make it a long-term success. Here are a few tips drawn from ReStore Stockton’s experience:

  1. Any earned income venture, especially one as public as a retail operation, requires the same careful planning as any business. Don’t rush to open or launch before you know where your budget and staff are coming from, what you are going to be offering (make sure its unique or better than the competition in some way), have a realistic time frame and a contingency plan for all kinds of unexpected possibilities. Then, have the entire plan reviewed by several business experts. Remember, you can only launch once.
  2. Promotion is the third of the big threes, following product or service design, and pricing. Since the store is in a warehouse, it’s no surprise that street traffic is minimal. And it sounds as though the store is hard to find even for those who seek it out. Make it easy for your prospective customers. Put the word out to builders in the region, as well as plumbers, electricians, interior designers and others in the build/restore field. Have an early morning launch breakfast to get them into the store. And, make it easy for customers to find you. If your store or office is buried deep inside a building, hang signs on the front door of the building, and down the street (if permitted). You’re trying to build loyal customers. Don’t frustrate those who are trying to find you.
  3. If you’re serious about a retail operation, then consider hiring professional(s) with retail experience. There are several second-hand stores in Manhattan that generate a lot of revenue for their nonprofits (which include the NYC Opera and Housing Works). They excel in offering interesting merchandise that’s well-priced (although not a bargain), and are 100% professional from their compelling window displays, to their strategies for generating interest in (and $ from) high-profile goods.

ReStore Stockton, now that you see where the holes are, it sounds as if you’re on the right track. Nonprofits everywhere can benefit from your experience.

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Nancy Schwartz in Earned Income/Ventures, Nonprofit Communications | 0 comments
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