When a nonprofit is developing its business plan, market demand for a product or service is a primary concern for estimating the potential for success. Success of course includes at minimum, financial gains that can be used to cover the costs to produce an intended offering and contribute to the nonprofit mission.
The "ususal" work to understand demand includes understanding the demographics and psychographics of the target buyer as well as the alternative choices (i.e. competition). A new study by Cone Communications (see Chronicle of Philanthropy) indicates that consumers are increasingly buying products that are linked to charitable purposes AND that these consumers are not satisfied with just having their money linked but really expect that specific results, charitable results, will occur.
I believe this expectation is important to understand as nonprofits increase their efforts to generate revenues to offset dependencies on philanthropy by trying to find paying markets for their goods and services. Based on this study, these nonprofits will position better if their promise is not simply, "your purchase will contribute to our work" but instead is, "your purchase enabled x number of folks to have y outcomes in their lives". Great market research will in the end actually help understand exactly what outcomes matter most to the prospective consumer.
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