Introduction

A nonprofit organization is one that classifies as tax-exempt under

501(c)(3) due to its financial structure and organizational mission. A non-profit is
structurally organized very similarly to a for profit business. A nominated board
of directors and an executive director function at the highest tiers of the
organization. There are various departments or committees within the
organization including a fundraising committee, finance committee,
programming committee, nominating committee, staff and administration, and
volunteers, the backbone of any non-profit. The main difference between a nonprofit and for-profit is that non-profits filter revenue gained back through the
organization to fund programming and further its mission, versus putting that
money into the pockets of the shareholders. This sector has seen steady and
sizeable growth in last few decades. There are currently 1.8 million registered
non-profits in the United States (GuideStar, 2014). According to the IRS
Statistics of Income report, non-profits showed a cumulative growth in GDP
measured at 66 percent from 1985 to 2010 (United States, 2010). While large
nonprofits such universities and hospitals make up the majority of the sector
financially, generating revenue through services and programs, small nonprofits
rely on contributions, gifts, and grants as their primary source of revenue. This
report will focus on the latter group of nonprofits, as they are the ones who are
largely struggling due to their reliance on charity. Many small non-profit
organizations in the arts sector are experiencing declining audience numbers, are
attempting to attract younger target demographics, and are struggling to utilize

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newer online marketing mechanisms like social media sites. Due to this fact,
contributions and gifts are also suffering.
By the late 19th century, the elite class of American enjoyed high
culture, which included the arts, universities, and social clubs. Through the
notion of cultural capital, a means to social promotion, beyond money, through
social assets, the elite class could seemingly rise above the lower classes on an
intellectual level and partake in the arts for their own social benefit (Bourdieu,
1986, DiMaggio, 1997). In the past century, however, these rigid notions of class
and art exclusivity have disintegrated, paving the way for the massification of the
arts. Thanks to an accepted understanding of the importance of art in all cultures
paired with new technology and hundreds of thousands arts non-profits, it is now
easier than ever to experience art, regardless of contrived classes, economic
status, and geographical location. Though the opportunity is great for art nonprofits to make a difference in our society, many lack the proper marketing
techniques to truly break into the market and pursue their unique missions.
Arts Administration is a fairly newly defined career path and many
administrators in arts non-profits are not professionally trained to do their job,
but are simply promoted to the position because of their experience and legacy
within the organization. Now these leaders are struggling to understand newer
marketing concepts and to adopt campaigns that include them, instead choosing
to function on a tradition of best practices. How can this marketing crisis be
addressed directly? This report will attempt to address these inherent issues
within the arts nonprofit sector through posing the question, how can small arts

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non-profit organizations utilize for-profit marketing constructs to maintain and

grow audience participation and diversify target demographics? To answer this
question, I have reviewed scholarly work in recent years on marketing within the
for-profit business model. I will use this as a comparative model through which I
will analyze arts non-profits. I will also propose a hybrid marketing model.
The literature on for-profit marketing and branding is expansive and well
adopted and integrated into the American business system. However literature
on effective marketing for non-profits is less widely available, less agreed upon by
scholars, and less digested and implemented by the thousands of struggling small
arts non-profits in the United States.
My final research report will be split into sections including a history of the
nonprofit growth, a current snapshot of the non-profit sector, business marketing
and public relations theories, various marketing mechanisms used throughout
the for-profit and non-profit sector, and a proposed hybrid marketing model.
General Conclusions of Current Literature
Scholars agree that the not for profit sector is struggling to adapt to the
digital age in the manner that many for profit businesses have. The general
conclusions of reports and studies on this topic are that audience retention and
diversification are declining because the motives and barriers of target audiences
participation are not being analyzed. Because of ill-advised or lackadaisical
marketing tactics employed by many non-profits who do not use metrics to
evaluate and reevaluate their campaigns, programming is suffering. Scholars also

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agree that using quantitative and qualitative research to guide future endeavors is
imperative to progression.
Current snapshot of the non-profit sector
The past twenty years have seen significant declines in arts attendance by
adults in the United States. This includes visual art exhibits and performing arts
events. There has been study after study proving this fact, but no definitive
reports had looked into why this was occurring until the deeply comprehensive
study completed by the National Endowment for the Arts, entitled When Going
Gets Tough: Barriers and Motivations Affecting Arts Attendance (2015). It
utilized the 2012 General Social Survey, a highly regarded, nationallyrepresentative biennial survey of U.S. adults attitudes, perceptions, and opinions
on a wide variety of social issues, as well as US Census Bureau questionnaires to
identify who is and isnt attending arts events and what is either motivating or
barring their participation (1). This study is so valuable because it is one of the
only to assess interested non-attendees. A summary of implications in the
report states that many arts organizations are being challenged to appeal to new
audiences and preserve old ones while upholding their mission and vision. It also
states that there are several other important factors that drive consumers to
attend or not attend arts events other than the art itself. These motives and
barriers include: socializing with friends or family members, lack of time to
connect with ones culture, to support ones community, to experience high
quality art, not having anyone to attend the event with, having no way to travel to
the event, and to learn new things (2). These motivations and barriers can be

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generally predicted through life stages of the demographic, socioeconomic status

and class identity, and personal values and attitudes (3).
The report highlights all of these findings as well as offers insights into
how to tap into these motivations and to overcome barriers. It ends with the
powerful statement, Recognizing such motivations and barriers will help
cultural policymakers, funders, and organizations find new paths forward, so that
all Americans have a greater opportunity to engage with the arts (4).
A previous comprehensive NEA study in 2013 entitled How a Nation
Engages with Art: Highlights from the 2012 Survey of Public Participation in
the Arts (SPPA), looks at a full decade of public arts participation. The survey
featured a much broader range of questions than previous studies and made use
of the U.S. Census Bureaus Current Population Survey. This report acted as a
jumping off point for the 2015 NEA study discussed above, attributing to the
development of the NEA module to identify motivations and barriers in arts
attendance (IX). Some of the illuminating statistics gathered included, slightly
over half of all American adults attended a live visual or performing arts activity
in 2012, older Americans emerge as the only demographic group to have
experienced increases in attending live visual and performing arts, and 71% of
Americans used electronic media to watch or listen to art (X). The report found
that technology appears as a great enabler of arts creation, and that the
percentage of 18- to 24-year-olds who have taken art classes or lessons at any
time in their lives increased significantly during the time frame of the survey,
and that across the region, all states experienced a decline in arts participation

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from 2002-2012 except New England (XII). The benefit of this survey lies in its
expansive time frame, tracking participation trends over an entire decade,
allowing for a projection of future numbers.
Shifting the Paradigm, jumping off of established research on audience
demographics and participation similar to the above reports, analyzed the
challenge that socially oriented non-profit organizations are facing: functioning
in a time of economic downturn and dwindling donation pools. The report looked
at three organizational processes that encompass this challenge: leadership and
social entrepreneurship, social innovation and technology transfer, and
organizational development and sustainability. The marketing and social
entrepreneurship section of the report proposes that through defining and
adopting a standardized test, a non-profit can track and analyze its social
successes through quantifiable means. Today, the non-profit sector largely
operates through means of best judgment and tradition, failing to assess the
successes or failures of their campaigns. By exercising a model that uses forprofit components to create, sustain, and assess a campaign, these same nonprofits can optimize funding and social impact.
Becoming aware of the issues the sector is facing is important for nonprofits. Yet it is only the first step. Many non-profits do not have access to
professionals well versed in addressing these issues; namely digital marketing
and analytics professionals. Joe Tripodi, Chief Marketing and Commercial Officer
of Coca-Cola Co. offers invaluable insights into new age business marketing in a
Wall Street Journal report. He advocates, "You cannot slide over people in your

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current organization because they have loosely dabbled in these areas. You need
to go to the millennial marketplace for 'natives' who have lived and breathed
these disciplines for much of their lives. These individuals are the ones who will
have the raw passion and technical skillset to connect the mission and vision of
the organization to its public in new and exciting ways. Legacy within the
marketplace is not something to be overlooked. But when it comes to rebranding
and innovating through non traditional branding techniques, non profits must
're-skill' their marketing organizations and build new capabilities in areas like
big data/analytics, digital, social, mobile, gamification and design. These pieces
of advice are coming directly from the CMO of a huge, global for profit, yet their
principles apply directly to the non-profit business sector.
After establishing the history of arts non-profits as well as establishing
where the sector stands today, it is important to look at marketing theories that
have been adopted, tried, and deemed successful within the for profit business
sector and marketing theories proposed for non-profits. I will compare and
contrast these theories and attempt to fit them within the non-profit sector.
Marketing and Public Relations Theory
Alexander Laskin (2011) authored a report that acted as a critical review of
current PR models and their empirical tests, and proposed new and improved
scales of public relations to further the excellence theory of public relations. The
Continuous Public Relations Model presents five scales on which organizations
can plot themselves to analyze their current practices and compare and contrast
them to other like organizations, whether for profit or non-profit. These five

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individual scales can also be compared to each other, to present a wide range of
information on the organization in a visual format. There are two dimensions to
each scale, positioned on opposition poles. The five scales, Laskins Figures 1
through 5, are as follows:

Direction of Communication scale:

organization dual direction public

This scale analyzes the direction of communication coming from the

organization to the public and from the public to the organization.

Intended Beneficiary scale:

benefiting the organization dual motives benefiting publics

This scale helps determine the entity that certain strategic decisions are
benefiting the most. What motivation is driving the organizations
decisions?

Strategic Nature scale:

reactive dual nature proactive

This scale analyzes whether an organization is making decisions in a more
reactionary or proactive manner.

Role Scale:

technical dual role managerial

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Knowledge of the managers role within an organization is very important.

Is he acting in a more technical fashion or strictly in a managerial fashion?
The answer to this question can prove invaluable in the reevaluation
process.

Timeframe scale:

short term focus dual focus long term focus

This scale helps to determine the focus of goals and objectives within the
company, whether short term or long term.
An organization can rate itself along a specific scale based off of rated
questionnaire answers. An organization can rate itself numerically on different
questions pertaining to the scale that will be used to plot them along the
continuum. Continuums can be compared and measured side by side for
reevaluation purposes. This Continuous PR model, a measurement approach to
public relations, allows a relatively simple and visual way of comparing and
contrasting organizations, which is an invaluable tool for non-profits to analyze
their own organization to make improvements over time.
Gainer and Padanyi (2001) examined the practices of a number of
nonprofits. The International Journal of Nonprofit and Voluntary Sector
Marketing is a leading scholarly journal that proves a valuable source for
marketers, managers, lobbyists, students, and educators alike. The article,
entitled Applying the marketing concept to cultural organisations: An empirical
study of the relationship between market orientation and performance,

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addresses the effects of the adoption of business management practices within a

non-profit business, looking at a number of non-profits as examples. Its research
objective was to determine whether market orientation, which can be expected
to lead higher levels of customer satisfaction and financial gain, also has a
significant impact on an organizations artistic reputation, and if so, what the
impact is. Previous studies widely used conceptual models to analyze arts
organizations but there was no common standard of analysis. The issue in
comparing past studies is the inconsistency in which the study defined
performance variables. Analyzing a non-profit is a complex task because each
organization is unique, receiving money from different stakeholders and
employing differing objectives and measures of success. The report found a
positive correlation between market orientation, customer satisfaction and
financial gain that supported the modern marketing concept which the report
advocates. It states, an organization will achieve its own goals through pursuing
a course of activities directed at the satisfaction of its customers wants and
needs (183). The theory dictates that this is reached through market oriented
activates and market oriented culture. This could act as one of the constant
forms of measurement across non-profits. Yet there is still an apparent divide
among nonprofit leaders over whether the modern marketing concept works in
and benefits a nonprofit organization.
An arts non-profit following the modern marketing concept could run into
internal issues including the resistance of staff who do not want to stray from

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comfortable routine. This is where the Systems Thinking theory proposed by

Peter Senge comes into play.
The Systems Thinking Theory looks at departments within an organization as
separate entities that directly influence each other. It is important that a nonprofit has an open flow of communication between all departments including
marketing, leadership, and finance departments. Through this lens of separate
but openly communicating departments, Senge describes how to turn a normal
organization into a learning organization. Senge states that there are three main
capabilities through which an organization should function: 1) fostering
aspiration, 2) developing reflective conversation, and 3) understanding
complexity. There are learning disabilities that dissuade organizations from
reaching these capabilities. These mostly concern organizational culture and
mentality. An organization will be able to overcome these disabilities and reach
these three capabilities through following five distinct tactics: personal mastery,
mental models, building shared vision, team learning and Systems Thinking
The Fifth Discipline that incorporates the other four disciplines. The learning
organization is a model of organization that reacts, shifts, and grows as it
encounters new challenges, workers, and environments; this model is one that
could fit and benefit any non-profit organization, so long as it adheres to the
disciplines described.
Marketing Mechanisms
David Scott Merman highlights within his book, The New Rules of
Marketing and PR (2010), the old rules of marketing, some of which include one-

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way advertising, the separating of advertising and PR departments functioning

with different objectives in mind, interruption techniques, and the singular
importance of creativity in reaching a goal. Now, the web has transformed the
rules, and you must transform your marketing to make the most of the webenabled marketplace of ideas (18-19). With the average consumer seeing
hundreds of advertisements a day, Scott advocates the elimination of product
focused traditional advertising and the adoption of new age two way
communication marketing. Public Relations traditionally only dealt with the
media. Now successful marketing and PR are one in the same, dealing with
various publics including consumers, the media, and the government, 24/7
through all facets of communication. The book goes into depth on everything
from blogs to mobile marketing to effective writing for marketing and PR to
photo and video production and dissemination. Scott is a believer that we are
living through the most important communication revolution in human history
(26). He poses the question, Are you one of the revolutionaries? Or do you still
support the old regime? (27). This question is a pivotal one that non-profit
leaders should be asking themselves. Do I allocate the right amount of money and
human resource to new web based marketing ventures in order to reach a global
audience? Or is my content with the traditional marketing means of my nonprofit
hindering my organizations ability to retain and grow our audience/consumer
base? This book acts as an experts guide to conquering the online marketplace
through marketing and PR best practices.

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Securing best practices online is a sure fire way to increase Word of Mouth
(WOM) marketing, or Word of Mouth marketing. WOM spreads especially
rapidly through social media and the Internet so it is pertinent to discuss it in
further detail. Martin Williams and Francis Buttle (2013) wrote in the Journal of
Nonprofit & Public Sector Marketing, WOM can be defined as informal personto-person communication between a perceived noncommercial communicator
and a receiver about a brand, a product, a service or an organization WOM
gains persuasiveness through the higher perceived credibility and
trustworthiness of the communicator (285). In strategically utilizing social
media, blogging, digital marketing, news releases, and other new media as
defined by Scott, WOM should increase significantly. The study collected its
information through 16 in depth interviews of various individuals in a range of
departmental roles, including members of the marketing department, the
corporate gift and bequest sales forces and line management as well as through
other means of primary research (289). One important finding that emerged
from the research was that managers in nonprofits tended to act in independent
and uncoordinated ways that they believe may promote PWOM, even though
WOM specifically is not a measured objective (290). Through the themes that
emerged from all of the data collected, the team established what it referred to as
the Eight Pillars of WOM model for nonprofits: Donor WOM, Brand/Product or
Service WOM, Communications WOM, Key-Influencer Network WOM, Referral
Network WOM, Supplier/Alliance Partner Network WOM, Employee Network
WOM, and Organizational WOM. The study determined that, though WOM
appears high on the agendas of most nonprofits, unsophisticated means and

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lower tier players like volunteers are used to carry it out. Additionally, each
departmental unit interprets WOM differently (302). These inconsistencies
prove that non-profits are not taking WOM marketing as seriously as they should
be. WOM should easily and consistently fit into a non-profits strategic
communication and marketing plan.
Robert V. Kozinets (2010) focused specifically on the link between social
media and WOM, showing how marketers employing social media marketing
methods face a situation of networked coproduction of narratives (71). Through
studying over 80 blogs for half a year, the study established four communication
opportunities presented through social media: evaluation, embracing,
endorsement, and explanation. The consumers taking part in WOM marketing
are individually and communally influenced by character narrative,
communications forum, communal norms, and the nature of the marketing
promotion. Thus, a new and distinctive narrative model is formed, which proves
that marketing messages and meanings are systematically altered [by the
consumer] in the process of embedding them in their own narrative. The
narrative model suggests definite, pragmatic implications for how marketers
should plan, target, and leverage WOM and how scholars should understand
WOM in a networked world. The need to comment upon certain people,
products, events, and organizations is a need that is engrained in the social
nature of todays culture. Thus organizational WOM campaigns that tap directly
into this natural behavior could be invaluable to an organization. This study

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offers Narrative Response Strategies associated with WOM devised from this
research.
Social media is the largest sector of online marketing that non-profits can
tap into to drive marketing campaigns. According to the research report,
Customizing Social Media Marketing, when designing the optimal social sharing
mechanism for Facebook, managers must look at four tradeoffs: Reach vs.
Relevance, Strangers vs. Friends, Push vs. Pull, and No Incentives vs. Incentives
(8). The study looked at over 750 Facebook marketing campaigns to analyze the
social sharing mechanisms that encourage consumers to share information
about a product with their friends. The report suggests that managers consider
these four tradeoffs when making strategic decisions involving reaching a public
through their online campaigns and that the key to successful social media
marketing lies in customizing the campaign to the product or in the case of a
non profit, the event, exhibit, fundraiser, etc. (10). In discussing various
marketing theory and mechanisms, it is helpful to look at a real small scale arts
non-profit organization. The Alamance County Arts Council is a small non-profit
located in Mebane, North Carolina. Its mission is to be committed to shaping the
cultural identity of Alamance County by making art a tangible presence in the
lives of its citizens and to enhance the quality of life by engaging people in a
diverse array of art through the delivery of programming and education, and
through the provision of facilities, advocacy, promotion and funding (About Us,
2014). According to the organizations 2013 990 form listed on Guidestar, its
revenue less expenses for the year were -$69,139. Its total net assets or fund

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balances amounted to $790,169. They spent $50,535 on advertising and

promotion and $67,098 on office expenses (United States, 2013). The following
are the means through which Alamance Arts markets their programming:
website, Facebook, Instagram, Twitter, Blog Spot, Flickr, YouTube, monthly print
newsletter, monthly eNewsletter, and hosted events. From my tenure with the
Arts Council, I noticed a few flaws within its marketing and communication
efforts. Each month, the Council put out a comprehensive newsletter including
stories on the Council, promotional articles, articles on community partners, and
more. At least 100 of these 20 page documents were printed and mailed out to
members of the Council, amounting to a hefty fee in ink, paper, and postage. The
Council does, however, put out the same newsletter online. In terms of social
media, the Council spreads itself out thinly. Flickr, a photo sharing site, is utilized
on top of Instagram and Facebook. A blog is utilized on top of the newsletter and
Twitter. Volunteers, as well as the trained marketing staff member, post on social
media sites. The brand personality of the organization has not been established;
posting could stand to be more consistent and strategic. However, Facebook has a
very large and engaging following nonetheless. Current social media followers,
volunteers, and participants in events are older and youth and minority
audiences seem to be missed in current marketing and communication practices.
The implementation of a training program for volunteers who handle marketing
efforts and the development of a strategic communications plan could create a
more efficient marketing system for the Council, leading to more visibility,
engagement, and thus more donations. It could also cut down on the unnecessary
advertisement and promotion expenditures

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The Hybrid Marketing Model for Arts Non-Profits

The lack of a widely adopted marketing model, inclusive of trending
marketing platforms, and the lack of an accepted marketing evaluation tool is
alarming for the arts sector, considering the problems it is facing as an industry.
This absence has lead some arts non-profits to follow traditional means of
advertising that are missing key target demographics entirely. Marketing is the
means through which an organization can reach and engage its target
demographic. Today, the rise of services and intangibles, the fragmentation and
new combinations of markets beyond the old industrial classifications, the
increasing power of customers, and the new tools and techniques of
interactive marketing have all lent a hand in the transformation of the concept of
business marketing. Where once, the marketing power rested solely in the hands
of a separated marketing department, the job is now everyones role, meaning
all members of the organization are responsible for marketing and public
relations in one form or another (Doyle, 2013). In addition to the communality of
marketing within a successful business, marketing efforts should be coupled with
communication and public relations efforts. Marketing can be product and/or
program facing but should always bear audience in mind.

Taking all of the above considerations into hand, filling in the gaps of
current marketing practices by struggling arts non-profits, I developed The
Hybrid Marketing Model for Arts Non Profits shown in Figure 1.

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The Hybrid Marketing Model for Arts Non Profits

Figure 1

The mission of the model is to use effective and comprehensive marketing

strategy, utilizing current trends in communication, to reach target audiences
that are not currently engaging in the arts including: youth, inhabitants of lower
socioeconomic areas, persons who identify as too busy to engage, and more.
Non-profits must be cognizant of both the mission and the context of the model
when engaging in its process. The four sections of the model are as follows:
Resources, Activities, Output, and Effects. Each is defined in Figure 1. An over
arching phase entitled Constant Evaluation surrounds the four sections.

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Resources
The success of a strategic communications campaign lies within an
organizations workforce. To attract, develop, and maintain workers who believe
in the organizations mission, understand its direction, and are able to carry out
operations efficiently, creatively, and communally is imperative. Administrators
within an established art non-profit may resist to serious change within the
organization for many reasons, some valid. Thus it is important to recognize this
possibility and address it head on, through authoritative meetings and seminars
about the benefits of the model and of the Internet, in order to spur true change.
Activities
Once this workforce is acquired, an open flow of communications between
organizational committees and departments will ensure the purpose of the
communication campaign and its implications are not lost in translation or
misconstrued, factoring in the Senges Learning Organization concept. During the
golden years of the newspaper industry, the journalism and marketing
departments would not communicate at all, but rather compete with each other.
If that were true of the public relations and marketing departments within a
single organization today, it would prove counterintuitive. Realize the value of
open communication, integrated both horizontally and vertically, in order to
establish a workforce of likeminded individuals, confident and proud of the group
efforts to reach the mission. Maslows Hierarchy of Needs (1943) chart says that
responsibility of an important job along with recognition helps to satisfy their
higher-order esteem needs (Schermerhorn, 314). If an individual has a true say

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in the organization and feel valued, they will be that much more invested in the
goal.
Output
The strategic communications plan is the core of the entire model. A
strategic communications plan is the bible by which an organization functions
and communicates with its publics. A comprehensive plan includes: goals, target
audience, strategy, tactics, timeframe, and a creative concept that ties all
elements together. This plan must account for current trends in communication
and for WOM, as advocated by Kozinets, Williams, and Buttle. Current trends in
communication include social media sites like Facebook, Twitter, Instagram,
Snap Chat, and Word Press. Through the fulfillment of the strategic
communications plan, which employs a widely accepted evaluation method like
Laskins, engagements both online and in person and increased donations will
result.
Effects
The ultimate goal of any business plan is to increase sales and profit. The
ultimate goal of this hybrid model, as with any non-profit, is to increase
engagement thus increasing donations. This goal aids a non-profit in fulfilling its
mission.
The Hybrid Marketing Model for Arts Non Profits will only prove
successful if managers understand and commit to each of the factors discussed.
The model will fail if even one factor is ignored or not followed truthfully. Non-

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profits cannot afford to carry on with business and marketing processes blind to
new media. For the sake of the arts and its continued livelihood, managers must
embrace the times.
Conclusion
A non-profit structure is built nearly identically to that of a for profit
structure, the difference lying in the allocation of profit. Thus, the marketing and
public relations principles a non-profit applies to its operations should be similar,
in order to maximize publicity and profit. Scholars agree that the sector is
struggling to attract and retain audiences, which is leading to declines in
participation and funding that could be combatted through the adoption of
certain models and theories into its strategic plan. The change must start within,
as advocated by Senge, permeating the organizational culture. This means, all
employees must actively accept change and fulfill their role in executing and
analyzing modern progressive techniques. These include models such as the
Continuous PR model, which evaluates a company based on a series of
continuums with different publics at each pole, the Modern Marketing Concept,
that advocates for a purposeful relationship between market orientation,
customer satisfaction and financial gain, and the Systems Thinking Theory,
which encourages an organization to act as an evolving entity that survives off of
interdepartmental communication. Means of meaningful marketing mechanisms
include Word of Mouth marketing, which takes place both internally and
externally of the organization, and social media marketing.

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The research that has been put forth analyzes for profits and non-profits as
completely distinctive from each other. This report will intentionally blur the line
between these two entities and prove that the principles of business marketing
and non-profit marketing should be, and are the same. My report delved deeply
into business marketing models and theories, looking at non-profits through
these lenses. It is through this understanding that non-profits can truly break
into the digital communication age and revolutionize a dated practice of
marketing. Only then can non-profits truly pursue their unique missions and
visions.

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