A colleague and I were having lunch recently when our natter predictably lurched to work.  She asked what I thought was trending in the Corporate Social Responsibility (CSR) field.  My top-of-mind reply was, “What is old is new again. But more so.”

    What I meant was – and this is obvious – that we live and work in a time where “brand is king.”  As a result, corporations and their foundations use philanthropy as a tool to develop their brands as never before.

    Sure, relationships and mission alignment are important.  Yet today’s “reputation economy” demands more of us.  In fact, it obligates our proposals – whether they be for cash, sponsorships, in-kind contributions or volunteers – to be driven by advancing the grantor’s brand.

    Doing so offers new, meaningful, and thrilling ways to grow revenue.  Mentioned below is my method for using today’s CSR environment to further the grantor’s interests as well as mine.  I hope you find it useful.

    If you are already incorporating any of these practices, then I say “Congratulations!” to you.  Because you know the "traditional ask” is dead in the eyes of foundation decision-makers.

    My assumption is you are skilled in performing research, getting meetings, and preparing a test pitch.  Thus I will only share my techniques that I use once an in-person or conversation occurs.

    Sometimes my process and content is communicated during one meeting.  At other times over two discussions. My scenario is based on the latter.

    My objective the first meeting is to learn what the grantor wants to accomplish and fund by asking them to state what change they want to bring about.  My mind is open thinking is flexible.  My priority is to learn how to become relevant rather than to promote a program or agency.

    To discover our related interests, I often use an “opportunity plot” (e.g., a tic, tac, toe diagram).  In the left column I note the three (or more) major changes the grantor wants their funding to achieve while the right column are three (or more) points I want to accomplish. 

    The middle column records our mutually compatible interests.  (If it is blank, I thank her/him for speaking with me, and leave.) I then ask which middle column entry or entries merit a proposal.  Those that are worthy I refer to as the grantor’s needs.

    In our “reputation economy,” their needs are really brand needs.  I never mention the term. Maybe I should.

    I then verbalize how my application will address their needs.  We talk about the compelling data points and human interest stories my request must contain to show I am united with their goals.

    Next I suggest two opportunities to address each of their needs and those of both our beneficiaries.  The “client” tells me if that makes sense or not.  Her/his comments are taken into account as I summarize why her review committee will think my application is unique, exciting and on point.  I end by explaining how by working together we can make the change they want to fund last.

    Before leaving I request a 15 – 20 minute second meeting for a day far in advance of the submission deadline.  If it is not granted I describe my anticipated budget in medium-to-broad detail.

    However, if there is a second meeting, I will recap our previous discussion and disclose my plan’s finances.  Specifically, we talk about (1) the requested amount of my grant; (2) my program costs; and (3) the return on their investment (ROI). 

    Since the finances are intertwined, I present discrete information as to why my requested budget is necessary to fulfill their needs.  (This assures them that I will not ask for more funding during the grant term.)  I continue by comparing my budget, overhead percentage, and program fees (if any) to similar programs.  Then I make sure they know of any budgeted fundraising expenses in case they want to eliminate them.

    This is followed by a summary qualifying and quantifying their investment to their beneficiaries and stakeholders.  I also share what their support means to my beneficiaries and stakeholders.

    I then present the ROI their investment will create. My calculations result in being able to say, “Every dollar you invest in my proposal will return $5 toward meeting your expressed needs targeted beneficiaries.”

    Perhaps the best metric is saved for last.  It applies directly to the corporation’s and foundation’s brand.  I wield it only when my gut tells me it will have a positive impact on my application.

    I ask if they are aware of the Lev, Petrovist, and Radhakrishnan research published in 2007 that quantified the value of a corporation’s philanthropic giving on its bottom line.

    The three researchers studied 251 of the 300 largest U.S. corporations and found that the “average” company’s philanthropic investment – which was 10 cents for every $100 in net sales revenue – generated a $2 to $3 rise in profits (not gross revenue!) for every dollar they put into philanthropy.

    Most importantly, the research showed that charitable activities attract new customers and build brand loyalty.

    Corporations and their foundations have long recognized philanthropy’s benefit to their marketing mix and brand.  It is our job to use their brand commitment to benefit those we are both privileged to serve.

    Parenthetically, last January I contacted Dr. Lev for a study update and he said Dr. Petrovist was preparing new results for publication.

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  • How Epic Fails by Apple, Google, and Facebook Can Improve Your Product Launch

    by Bill Ballas


    Everyone makes mistakes.  Even executives with lots of success and cash under their belt.  Here are a few examples:

    Apple Newton - FaceBook Home - Google’s Lively - HP Touchpad – Microsoft Zuni - Netflix Qwikster


    Here’s what you can learn from their failures to improve your product launch.


    Recently I’ve been advising two start-ups to help them seize their respective market opportunities.  A major concern for each company’s founders is how their new products will earn customer adoption.  None of the owners wish to be among the nearly 50% of “new brands for new markets” that bomb. They simply want to know,

    “What factors will influence the successful adoption of a new product?”


    This is what I shared with them:

    The principal cause for new product failure is that entrepreneurs often do not

    view adoption through the eyes of each of their targeted customer segments.


    A marketing professor of mine once remarked, “People welcome innovation, but it is change they don’t like.”  He was referring to the many “yes/no” decisions each consumer makes that determines whether s/he will adopt a new product.


    And, as sentient human beings, we make choices based only on our psychology (which includes emotions).


    Product fails also occur for many reasons related to human psychology.  Numerous entrepreneurs botched their new products by believing too strongly in the inherent superiority of their new gizmo over existing competitors. 


    We’ve all heard the myth that the world wants a “better mousetrap.”  It doesn’t.  Yet this myth persists.  So, when I hear an innovator brag about her/his “better mousetrap,” my first thought is that s/he does not deeply understand how each customer segment perceives the product’s benefits. 


    On other occasions the new product nose-dived because consumers thought it was too ahead of its time. Or risky.


    Now and then the invention was incompatible with the values and experiences of potential consumers.  At times, customers perceived it as too complex to understand or use.


    In some instances customers could not try the innovation sufficiently before purchase to encourage adoption.  Or, if the product were tried appropriately, the results of the consumer experience were not adequately observed or communicated to others.


    A product’s non-acceptance may also be due to distribution, promotion, positioning, and timing issues, as well as the execution of its rollout. 


    Regardless of the cause, however, the best way to mitigate a futile product introduction is for entrepreneurs and companies to perform the qualitative and quantitative research needed to closely align their product with the psychology of each targeted consumer group.


    While it is possible for entrepreneurs to make money before their innovation gains market acceptance, it is not probable.  The founders I am advising are "in it to win it," and are focused on learning more abou their customers to improve their chances for product (and financial) success.


    BTW, please let me know if you want to buy a Nook.  It is in almost new condition.  And reasonably priced.


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  • Is Maine's Governor Wise to Tax Some Nonprofits?

    by Bill Ballas


    In Republic, Plato remarked that “necessity is the mother of invention.”  That pragmatism is evident today in Maine, and it may further cloud the tax-exempt status enjoyed by many 501(c)(3) organizations.


    Specifically, Maine’s Governor, Paul LePage, recently submitted to the state’s legislature a budget for FY16/17 that levies a property tax on nonprofit hospitals, private colleges and summer camps.  If the Governor’s wished-for budget becomes law, these nonprofits would pay property taxes on their holdings above $500,000 while receiving a 50% discount off the standard tax rate.


    Mr. LePage believes Maine’s homeowners are unfairly subsidizing the 501(c)(3) orgs who will be most affected by the tax.  According to the Wall Street Journal, 51.4% of Maine’s property taxes go to funding state and local government.  The national average is 29.7%.


    The Governor is using the FY16-17 budget as his tax reform plan.  In it, he calls for $62 million in budget reductions for localities believing that it would reduce waste by forcing local governments to share more services. The tax on nonprofit property would help municipalities pay for police, fire, snow removal and other services.


    Mr. LePage’s budget/tax overhaul also lowers the top individual and corporate tax rates, issues tax credits for low-income residents, and broadens the number of goods and services eligible for Maine’s sales tax.


    Currently, all states exempt 501(c)(3) organizations from property taxes believing that they improve the quality of life for residents and provide services that government would otherwise have to offer.  Some states, like Virginia, let municipalities choose which nonprofits should be taxed. 


    In many states, though, nonprofits voluntarily agree to pay municipalities for the services they use in exchange for their tax-exempt status.  And, just three years ago, the mayor of Providence, RI got an agreement for voluntary payments from Brown University and other colleges. 


    According to the Lincoln Institute, more than 200 localities have negotiated payments with nonprofits in lieu of taxes.  About 75% to 80% of these organizations are in the northeast, with the largest share being in Massachusetts and Pennsylvania.  They add that Maine has a high-concentration of tax-exempt academic and medical institutions.


    Opponents of Governor LePage’s property tax measure argue that it would cost the state more in lost services than it would generate through taxes.  The Auburn Food Bank (Auburn, ME) said if the property tax were in effect today, it would owe $24,500 and be forced to reduce the amount of food it dispenses.


    Foes of the tax add that the result will lead to staff layoffs at 501(c)(3) organizations, higher tuition and health care costs, reduced services to community members, and force many tax-exempt organizations to move to other states.  Others wonder whether the property values placed by the state would be fair.


    In his book, New Frontiers of Philanthropy, Lester Salamon and other experts explore new ways for philanthropy to combat rising poverty rates and many other ills in an era of shrinking government funding.  If you’d like to explore how these ideas could be put to use at your agency, drop an email to billballas@wsballas.com

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  • How Corporate Phlanthropy Improves Corporate Profits      

    by Bill Ballas                                            

    by Bill Ballas


    Earlier this week I attended an informative luncheon hosted by the AFP Silicon Valley Chapter.  It was so fascinating I felt compelled me to write this entry for my friends and clients in the corporate and not-for-profit sectors. 


    The featured speaker was Jacquelline Fuller, Google’s Managing Director of Global Giving (www.google.org).  Her presentation, “Why Google Gives,” was focused on sharing Google’s grant opportunities and hints for submitting a successful application.    


    Between taking notes, I was reminded of a study that showed for every $1 the average corporation gave to charity, it should see its profits grow by $2 to $3.  The research was published by Lev, Petrovist, Radhakrishnan (2007), and it analyzed the corporate donations of 251 major companies for 2005. 


    For details on this research project and their more recent work on the topic, copy and paste the following link in your web browser: http://blogs.law.harvard.edu/corpgov/2011/08/20/making-the-business-case-for-corporate-philanthropy/


    In the meantime, their other findings were:


    • The top 251 corporations donated $14b in cash and goods (44% of donations)

    • The top 251 corporations averaged donating 10 cents for every $100 of net sales revenue

    • The top 15 corporations donated $1.6b cash, and $4.5b in goods

    • For every $1 given to charity, the average company should expect profit to rise between $2 and $3

    • Most corporations do not take full advantage of corporate philanthropy as a business tool.


    It seems that when corporations properly promote their charitable activities, they attract new customers, strengthen consumer loyalty, improve staff retention, and build an esprit de corps among their employees.  This is quite a return on an investment of 1/10th of 1% on net sales revenue!


    Google seems like an exemplary corporate citizen – not just for the $100 million it donates annually – but also for the time and talent their 30,000 employees give to not-for-profits.  The aggregate value Google’s contribution to philanthropy is enormous.


    While some marketers argue that corporate philanthropy is wasteful or a “tax” levied on shareholders, others ask, “If a company doesn’t support the community in which its employees and customers live and work, why should consumers support the business?”  After all, corporate philanthropy is good business for everyone. 


    If you want more proof, do a google search on “corporate + giving + enhances + profits" and see other study results.

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  • Is Tim Cook Crazy Or Brilliant?

    by Bill Ballas


    by Bill Ballas


    If you made it this far, you’ve noticed several quotes on this website.  Each comment represents my view as to best marketing or fund development practices. In fact, Peter Drucker’s words that ". . . business has only two basic functions: marketing and innovation,” informed WSB’s positioning statement: “Innovate. Market. Repeat.” 

    My intent is to make this space useful to you, so I will also share the musings from thought leaders whose words provide insight and inspiration.  So, let’s begin.

    Have you noticed that major corporations such as Apple, Google, and PepsiCo are now planning their marketing strategy “from the inside out” just as not-for-profit organizations do?  The reason is these companies believe their mission gives them a powerful competitive advantage.  As Apple’s Tim Cook remarked last summer, “We do things because they are just and right. We are committed to advancing humanity.” 

    As Mr. Cook and leaders of not-for-profit organizations know, an “inside-out” strategy is idealistic, practical and strategic.

    So why do so many businesses have mission statements to the effect of, “Our mission is to build the world’s best widgets.”  (Note to readers: You know that is not a mission statement, right?)   

    And why do many not-for-profits have equally obtuse mission statements whose focus is on outputs rather than outcomes? 

    Whether an organization is for-profit or a charity, if their mission statements are fuzzy, then so are their brands.  

    I believe Cook’s statement is brilliant and strategic.  He is using Apple’s purpose (“advancing humanity”) to differentiate Apple and unlock societal value – something the world’s wealthiest company finds great worth in doing.   

    Over the years it has been my good fortune to work with corporate and not-for-profit clients to create an “inside out” mission statement through "Reimagining Exercises."   Each of them found the process valuable, and often in unexpected ways related to employee retention and morale.  

    Tell me what you think.  Do you believe Apple’s purpose will drive future profits for them?


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