THE AGENCY BUSINESS: Working with the right nonprofit client can pay off for PR firms

While many firms avoid nonprofit clients, Paul Cordasco finds those that do the homework and are a bit more strategic in their approach will benefit - financially and otherwise - from such relationships.

While many firms avoid nonprofit clients, Paul Cordasco finds those that do the homework and are a bit more strategic in their approach will benefit - financially and otherwise - from such relationships.

About six years ago, David Gwyn decided to take a chance on a client. At the time, that client, the Central Intercollegiate Athletic Association (CIAA), had an annual marketing budget of only $25,000, but he decided that the account was worth the chance. Since then, he has seen the client flourish, as the CIAA's central annual event - its NCAA Division II basketball tournament - has become a bigger and bigger draw. "We took a chance on them, and they took a chance on us," explains Gwyn. "Now it's paid off for us both, as we have helped them build interest in their tournament." Today, Gwyn works as a partner in Raleigh, NC-based French/West/ Vaughan, where he continues to service the client, with one big difference - the CIAA's marketing budget is now well over six figures, and it's one of the firm's most profitable accounts. While this tale may not seem significant to any agency exec who has seen a client grow from humble beginnings into a sizeable account, what might make this story worth noting is that the CIAA is a nonprofit organization. To some agency pros, it may seem counterintuitive, but such an example proves that it's not impossible to turn profits with nonprofits. However, it's not always as simple as Gwyn's experience, and agencies that are used to working primarily with for-profit clients probably need to take stock of their own expectations before adding a nonprofit. First, experts say it's important to understand that not all nonprofits are created equal. Many will seek out PR firms mostly on a pro bono basis. That means picking the right nonprofit can be a delicate process and firms must evaluate why they are adding this client early in the life of the account. "I think a lot of agencies can get sucked into nonprofit work, and if they are doing it out of the goodness of their soul, then that's great," says Rodger Roeser, a VP at Cincinnati-based Justice & Young Public Relations. "Yet some nonprofits will actively seek out agencies because of their expertise and try to convince them to do free work or pro bono work. Agencies need to be mindful that this may not lead to anything concrete or tangible." Moreover, with some notable exceptions, most nonprofits can't compare to their for-profit counterparts when it comes to marketing spend. "[Nonprofits] force you to be more strategic in your provision of service," says Rodney Ferguson, MD and principal at Washington DC-based Lipman Hearne, one of the US' largest marketing communications firms dedicated solely to servicing nonprofits. Ferguson says his work at Lipman has taught him that agencies need to do some homework before adding a nonprofit client. "In terms of organizational capacity, nonprofits are not that different from the private sector," says Ferguson. "Some have the resources to bring in outside counsel and some don't. Like with any business, we look at a non-profit's leadership, mission, and its commitment. We've certainly turned down nonprofits where one of those three was not in place." Some firms say they have learned to leverage their nonprofit clients in several ways, including staff training and even marketing. "About 10% of our clients are non-profits," says Jen Prosek, partner at Cubitt Jacobs & Prosek. "They teach our people how to do more with less. They also remind us that not every entity in the world functions like a corporation." Prosek also says that for her firm, the real financial payoff from working with nonprofits doesn't always come from the nonprofits themselves, but usually from the corporate partners of the organizations. For instance, the firm was hired to plan a campaign for the environmental organization Keep America Beautiful. As a result of that effort, Cubitt Jacobs & Prosek began a relationship with Proctor & Gamble's Gain brand detergent, which eventually led to Gain joining as a new client. "While Keep America Beautiful may not have the marketing spend of some other clients, if you take the budget we have from the original client and the budget we've received from their sponsors, it starts adding up to something very nice," explains Prosek. ----- Nonprofit clients
  • Both the client and the agency should determine early on what each expects from the relationship. Is this a pro bono relationship? What resources are the agency willing to expend? What can and will the client pay?
  • Agencies can often leverage their nonprofit clients to help marketing to for-profit clients. That can mean building on relationships with corporate sponsors and other partners of nonprofit clients.
  • Nonprofits can force your staff to become more strategic in its approach to campaigns as account executives must often learn to do less with more.

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