5 Reasons Selling to Nonprofits is Unique
"We make a living by what we get, but we make a life by what we give."
- Bill Gates
If your products and services can be sold to the nonprofit market and your business model and team are optimized for B2B selling, it may make obvious sense to start using marketing, business development and sales resources to penetrate that market.
Before you wade into those waters, here are five things to consider:
Mission Oriented - There is a reason nonprofit employees are willing to make less than their peers at for-profit companies, and it’s not their qualifications. For most nonprofit employees, they live and breathe their mission. To some, it’s even more personal as they themselves have been impacted or a family member or close friend. Selling to someone who cares about a greater purpose beyond features or functions your products and services can deliver is important to understand as it impacts their decision making. As a company who sells to nonprofits, it’s vital to have a team that understands the people who work for nonprofits and their motivators.
Budgets - Don’t be fooled, nonprofits do indeed have lots of money. The nonprofit market in the U.S. alone brings in over $500 billion annually. BUT, nonprofits and their employees are held to a higher standard on how they spend that money as all giving in the U.S. (and other countries as well) is public record information. Therefore, these budgets are scrutinized to a level that for-profit companies are not. Having insight into how budgets are made and spent gives your sales, account management and customer success teams an advantage in the nonprofit B2B landscape.
Timelines - Fundraising cycles and nonprofit timelines often run counter to the for-profit world. For example, year-end is the biggest season for giving and is a timeframe when many nonprofits are making budgeting decisions which makes December an unusually popular selling month in the nonprofit B2B world. Understanding the nuances and timelines of nonprofit decision making is paramount when trying to penetrate this market.
Capacity - This goes hand-in-hand with nonprofit budgets, but its worth remembering that a lack of budget also constrains a nonprofits capacity. Their available time and resources to review, implement and make your products and services successful isn’t what it is in the for-profit world and your business model has to account for that.
Referrals - The nonprofit industry is a relatively small corner of the business world. Many employees and vendors have been involved for decades (like us!). This is a tremendous opportunity for vendors to make a name for themselves, but also a concern if you’re unknown or burn bridges along the way. Having a few trusted referral partners is a must when trying to penetrate this market.
Do you or your team need help in understanding, planning for, selling-to and/or supporting nonprofits?
Our staff has over forty years experience in the nonprofit landscape and has helped technology companies, advertising agencies, consultants and more better penetrate and support the nonprofit B2B landscape.
Contact us below to get started!
