The Concept of Market Segmentation in Fundraising

[MSONGA The Consultant]

Should the nonprofit attempt to target all potential charity donors with its fundraising, or should it focus on specific groups of donors, particular types of people, particular types of foundations, or particular types of corporations? This is the crucial question for nonprofit when designing its fundraising strategy.

Market segmentation is a business practice that brands use to divide their target market into smaller, more manageable groups of people based on common ground they share to optimize their marketing, advertising, and sales efforts. Simply put, customers of each market segment have similar characteristics that businesses can leverage to advance their efforts.

It is obvious that, all nonprofits have limited resources, to target the whole market is the unrealistic for many nonprofits except the largest ones. The effectiveness of fundraising can be improved when the nonprofits narrowly focus on a specific group of donors. By segmenting the market, the nonprofits develop a better understanding of the needs of their donors. They understand what motivates them to giving, how to approach them, the outcomes they desire to see, the message they like to receive.

Market segmentation also allows the nonprofits to tailor their approach to reflect the needs of the individuals or organizations they approach. The researches show that donors who are approached with a tailored solicitation that reflect their genuine concerns and interests are significantly more likely to respond, to derive satisfaction from their giving.

Nonprofits can market their donors based on following number of ways;

• Behavior Segmentation: This is a particularly helpful approach in the domain of donor retention. Some organizations here, segment donors according to their level of interest and knowledge on a particular subject.
• Geographic Location: Nonprofits can segment their donor markets on the basis of particular region, cities etc.
• Demographic Segmentation: Nonprofits can segment their donor markets on the basis of variables like income, religion, race, ethnicity, age, gender, generation etc.
• Psychographic Segmentation: Psychographic segment are created on basis of personality traits, values, lifestyles or combination of all elements.
• Business Market Segmentation: Nonprofits also need to segment the market for corporate donations as they don't only raise funds from individuals.

OMAR MSONGA
CONSULTANT
Project Management, Strategy, Fundraising & Training
Call: +255 719 518 367
Email: omarmsonga8@gmail.com
DAR ES SALAAM
TANZANIA

 

[Kichwamoto]

View attachment 2717808

Should the nonprofit attempt to target all potential charity donors with its fundraising, or should it focus on specific groups of donors, particular types of people, particular types of foundations, or particular types of corporations? This is the crucial question for nonprofit when designing its fundraising strategy.

Market segmentation is a business practice that brands use to divide their target market into smaller, more manageable groups of people based on common ground they share to optimize their marketing, advertising, and sales efforts. Simply put, customers of each market segment have similar characteristics that businesses can leverage to advance their efforts.

It is obvious that, all nonprofits have limited resources, to target the whole market is the unrealistic for many nonprofits except the largest ones. The effectiveness of fundraising can be improved when the nonprofits narrowly focus on a specific group of donors. By segmenting the market, the nonprofits develop a better understanding of the needs of their donors. They understand what motivates them to giving, how to approach them, the outcomes they desire to see, the message they like to receive.

Market segmentation also allows the nonprofits to tailor their approach to reflect the needs of the individuals or organizations they approach. The researches show that donors who are approached with a tailored solicitation that reflect their genuine concerns and interests are significantly more likely to respond, to derive satisfaction from their giving.

Nonprofits can market their donors based on following number of ways;

• Behavior Segmentation: This is a particularly helpful approach in the domain of donor retention. Some organizations here, segment donors according to their level of interest and knowledge on a particular subject.
• Geographic Location: Nonprofits can segment their donor markets on the basis of particular region, cities etc.
• Demographic Segmentation: Nonprofits can segment their donor markets on the basis of variables like income, religion, race, ethnicity, age, gender, generation etc.
• Psychographic Segmentation: Psychographic segment are created on basis of personality traits, values, lifestyles or combination of all elements.
• Business Market Segmentation: Nonprofits also need to segment the market for corporate donations as they don't only raise funds from individuals.

OMAR MSONGA
CONSULTANT
Project Management, Strategy, Fundraising & Training
Call: +255 719 518 367
Email: omarmsonga8@gmail.com
DAR ES SALAAM
TANZANIA

I wish you could put those categories with case studies or real cases, and draw a line on segmenting consumer markets vs Business Markets. Work out those variables occupationally