[MUSIC] We've talked about how non-profit cultural institutions create meaning outside of markets, so why are we devoting an entire week to the subject of marketing? Isn't that contradiction? Well, no. Marketing is not a value system. It's not a category of why and how you do business. It's how you create relationships, whatever business you're in. Marketing is the commonly used language to describe a broad range of activities that are undertaken to reach those people you want to attract, their time, their money and their loyalty. In the non-profit sector, our mission is that customers will benefit more than we do. We're always interested in relationships, not just transactions and a lot of commercial companies are these days as well. Phillip Kotler, a marketing expert and a guru in our field, has a great definition of marketing. One that's all about relationships. And I think it's important to note that the idea of exchange is key to his definition. Marketing and selling are not the same thing. Marketing is an exchange and it may involve selling to others, but it's also at its best the creation of new value in the exchange itself. Sergio Zyman, who despite his introduction of new Coke, is considered to be a really sound thinker on commercial marketing, talks about the contrast between commercial and non-profit marketing activities. In his perspective for profit marketing is about selling more stuff, to more people, for more money, in more places, more often, more efficiently. For our sector you can adapt this to include providing more services to more clients in more places, more often, more efficiently, and we might add, more effectively. With regard to donors and supporters, because fundraising is a niche form of marketing, we can consider that we're trying to interest, and attract more donors for more money, more places, more often, more efficiently. Now i want to stress two points in this quick overview of what marketing encompasses for cultural institutions. The first is that marketing is much more than selling. And the second, is that effective strategic marketing is integrated throughout all activities in the organization. It's not a department. It's a way of doing business. First, how is marketing is more than selling. Well, marketing begins from some profound questions from mission related organization. As we talked about in the last lecture, we have to ask, whom do we want to serve and why. What customers do we actually want and why. Who are our competitors? Who are our potential collaborators? These are mission-related questions. And it's important that they form part of any marketing strategy. A marketing strategy is a decision about the story we want to tell. In our marketing seminar at National Arts Strategies, our professors tell the story of what happened a few years ago when Joshua Bell played in a Washington, DC metro station without anyone knowing who he was. A few people stopped, most people just walked by. And this is someone who sells out Carnegie Hall. The reason is that there wasn't a story associated with him. And so people subconsciously attached the story they would have for most musicians playing on public transportation. Nice they have talent, but not special, not worth stopping for. The way we tell the story about our work is what makes it worth stopping for, not to tell people what they should like, but to make sure they understand why they might like it. The second point I want to make is that the most effective marketing really is mission linked. It's integrated throughout all of our strategies and business practices. Because it's about how we reach people and create value for them. The writer and arts commentator Diane Ragsdale asks, in her blog Jumper, why we don't gather information about what our audiences may want and need through every aspect of our business. Our governing boards, our staffing structures, the way we're engaged in the community at all levels and the way we interact with other organizations in our communities. In the end, marketing is about how we create and communicate value. This quote from Harvard Business School Marketing Professor Bob Dolan sums it up nicely for the non-profit sector, even though he wrote it with the for-profit sector in mind. And I want to draw your attention particularly to marketing is the process via which a firm creates value for its chosen customers. A firm needs to define itself, not by the product it sells, but by the customer benefit it provides. And lastly, thinking about target markets that you wish to serve is a great lead-in to Peter's next session, who's going to be showing us how to identify market segments. [MUSIC]
