How to Spend Your Nonprofit Marketing Budget

Lou
Kotsinis

Over the last 10 years, there’s been a welcome transformation in the nonprofit sector. Nonprofits, and the boards that serve them have slowly come around to the idea that they have to invest in marketing in order to expand their mission, stay relevant and attract talent. Not all organizations have gotten the message, but enough have done so to ensure their own viability and to support a vibrant nonprofit community. 

Still, as with any other business, marketing dollars don’t grow on trees, and If you’re an executive director or nonprofit leader in charge of a marketing budget, properly allocating those funds can be stressful. Having been privy to many nonprofit marketing budget discussions, and having been asked to advise on the correct application of said funds, here are my thoughts on how to address this topic efficiently and effectively.

The Ground Rules

First, let’s start with some assumptions:

• You’ll have unrestricted use of your marketing funds.
  Yes, the budget must be spent on “marketing,” but you have free reign to spend on both direct marketing (brand, outreach, design) and marketing operations (technology, tools and software).

• Your budget will cover one year of activity
  At the end of the year (which can be at any point in the year), your budget will renew and you’ll start again.
   
• You have an adequate budget
  This, of course, is the hard one. “Adequate” budget for one organization may be beyond reach for another. Rather than get into specific dollar amounts, I’ll define “adequate” as having enough money to spend on multiple areas of marketing without shortchanging any one area. 

So, Where Do I Spend My Marketing Budget?

Spending your nonprofit marketing budget correctly is all about focus. Throughout the allocation process, ask “where will we get the maximum value for our marketing spending this year?” That answer will vary from organization to organization, but will inevitably fall within one or more of the following areas: Story, Marketing Tools/Software and/or Awareness (A.K.A. Exposure). 

For the purposes of our discussion, let’s say that there’s no one specific initiative you have in mind right now. This then, is how I recommend you prioritize the allocation of funds: 

1. Story
Budget allocation: 60%

In the nonprofit world, mission is everything.

The reason why people give to your cause is because they believe in your mission. And the thing that conveys your mission is your story. Get it right, with the right audience, and you will have a continual flow of  followers and supporters. Offer up an unclear, lackluster or uninspired story and you’ll be stuck.

Story is the foundational element of everything else you’ll do, and thus it pays to invest here.

Under the umbrella of story, I place three critical components: 

• Messaging
  What is your story? Who is your audience? What is your mission and how are you fulfilling it? What impact have you made? What is your vision for the future?

  Not only will you need to answer these questions, but the output of this inner reflection needs to form a narrative that’s clear, direct and engaging. To this end, you may consider bringing in a writer or content specialist as part of your marketing investment.  

• Brand (and logo)
  Messaging is a critical part of your story, but it’s just one aspect of your overall brand. 

  Brand is every way in which your audience comes into contact with your cause: from story to program delivery to digital outreach. The visual encapsulation of your brand is your logo. So while you’re working on all of the elements that define your brand, you should invest directly in your logo as the summary definition of who you are as an organization.

  Is it clear, through your logo, what your organization is and stands for?  Does your logo inspire pride and energy in your organization for your cause?

  Whether you need simply to refresh your logo, or go all-in for a comprehensive audit and brand overhaul, this is another key area of your overall story that should command attention and investment.

• Website
  As I’ve written before, a website is the single most important marketing investment a nonprofit can make; given the digital world in which we live, it’s the ultimate storytelling mechanism, and the one platform over which you have the most control. Part of your investment in your story should be the development of the highest-quality website you can afford, inclusive of design, content and user experience.

2. Marketing Tools and Software
Budget Allocation: 25%

If you’ve committed the resources to developing a compelling story and inspiring brand, all conveyed through a high-quality website, guess what? You will get supporters.

Now what?

Well, you’ll need to engage those visitors, and you can’t do that without the proper tools. So the second area in which you should be allocating marketing funds is in the software that will help you collect, assess and act upon the user data that’s coming your way.

At the very least, this entails: 

• • A CRM (Customer Relationship Management) tool to keep track of your donors and key stakeholders
  • An Email Marketing program
  • A Donation platform/Fundraising tool (which may or may not be integrated with your CRM)

And ideally, 

• Website Analytics Tools (in addition to the free Google Analytics tool); these might include a lead capture program, or even a heat mapping tool to illustrate how users are interacting with your key pages
• Digital Marketing Reporting Tools including a dashboard that can collect all of your digital marketing data in one location

Lastly, you’ll need to budget for tools that are necessary for the operation of your specific cause.  Say for example, you run a foundation that solicits applications for program funding, and that you want detailed application information from each program applicant. You may require a platform that receives and qualifies this content. This is the type of product that’s essential to operations of your organization, and thus must be included in this budgeting channel.  

Note that this category’s budget will be significantly affected by whether or not you purchase these tools off-the-shelf as third-party subscription services, or decide to have them custom-built to your specifications. It’s important to think through your functional needs prior to determining your budget here, especially if one or more of these tools is mission-critical.  

3. Awareness (Exposure) 
Yearly Budget Allocation: 15%

You can have the greatest mission in the world. If no one knows about it, you’ll never reach your true potential. 

Accordingly, you’ll want to set aside at least some portion of your yearly marketing budget to communicate to the world about your mission. I’ve ranked this third in “importance” because it is indeed discretionary, i.e., you shouldn’t be spreading the word on your mission if, when people arrive at your site or social presence, they don’t understand what you do (story) or, they can’t properly navigate or engage with your web properties (tools and software).  

If, however, you’ve addressed the first two components on this list, then let the floodgates open, as much as is feasible. There are many ways to do this, but I’ve written about what I feel to be the most effective digital marketing tactic for exposure. Perhaps start there.   

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So there you have it. Based on my experience these are the key areas, delineated by suggested budget allotment, where a nonprofit can spend their marketing budget for value and impact.  

Note that the percentages I’ve listed here are just ballpark. Your organization may have been investing in story for years, and you may be generally satisfied with your marketing toolset; you can then shift budget accordingly. But, if you’re starting with a clean slate, this is where I would invest and then plan against that framework going forward.

Use these guidelines to plan next year’s budget, and see if it makes sense for your organization. Have fun investing in the future of your cause, and if we can be of assistance in that process, just let us know. We’re only an email away.

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