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B2School Monday Minute: What is a ‘non-profit’

Monday, January 28th, 2008 | Back to School Monday Minutes, Blog Talk, Carnival of NPC, Identity Crisis

I recently overheard a conversation that got me thinking. Here’s a clip from the conversation:

Person 1: With the rise of a third sector, defined as the non-profit sector, how will this affect both the private and public sectors? And, what are the relationships between the three and what will that mean for the future?

Person 2: Well, what is non-profit? Non-profit means merely a tax break. You have two kinds of non profits. Those that are genuinely good and advocate for their cause efficiently and effectively, but then you have those that don’t. So, when you say non-profit, you’re merely talking about a tax break.

Needless to say, this conversation got me wondering, and I’m still pondering. What is a non-profit? And, say the word ‘non-profit’ is a brand….how do current consumers perceive this brand?

I feel these questions are important because whether you are a political organization, grassroots, religions, a charity, professional organization, foundation, community oriented, advocacy organization, special interest group, etc… how the broad term non-profit is ‘branded’ and perceived could have large implications for your success.

Graduate student from Case Western Reserve University, Kate Luckert, provides a great outline on the definition of non-profits and various examples, including why they may/are important.

About. com’s definition tends to support Person 2’s definition of a nonprofit:

A nonprofit organization is one that has committed legally not to distribute any net earnings (profits) to individuals with control over it such as members, officers, directors, or trustees. It may pay them for services rendered and goods provided.

The European research Network states that there is no universally accepted definition to the term: non-profit sector. There is also no universally accepted social marketing definition. My view though is…. if the term non-profit lacks in credibility and reputation, the term social marketing should be used more often to describe certain effots.

Many organizations practice social marketing, but they don’t know it or realize it. Some people say that the term social marketing is too limiting, however, I see it more as an umbrella term backed with credible research.

Thoughts?

• nonprofit.
• social marketing.
• private sector.
• public sector.

How do they relate?

Tags: about.com, academic concepts, defining terms, European Research Network, government, Identity Crisis, Marketing, non-profit, philanthropy, politics, private sector, public sector, research, sector, Social Marketing, taxes, third sector

1 Comment to B2School Monday Minute: What is a ‘non-profit’

Holland
January 28, 2008

I don’t think non-profit and social marketing are very synonymous at all.

Any entity could be a social marketer, but as you state in your post, a non-profit is specifically is there to not make a profit for any shore-holder, but rather to provide a service (many times to less-fortunate people).

I don’t know why, perhaps it is my capitalist mindset, but if you say non-profit, I connect a negative connotation to it. But then if you say a church is non-profit, or the Red Cross is non-profit, et al. then it becomes okay again. So, I don’t know?

I guess according to my own definition, a non-profit is what a company is, whereas social marketing is what a company does.

Ta

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