ACU (Australian Catholic University)

Insight

Issue 6, Spring 2012

What's in the name?

What's name_content

Corporate branding is big business, but where do charities fit in? Margie Dimech spoke to Dr Helen Stuart about how not-for-profits are learning to compete for your money.

Mac has an apple, Nike has a swoosh and McDonald’s has its yellow arches.

Companies with strong corporate brands are instantly recognisable.

Their prestige convinces us to pay more for their products and they command unwavering loyalty.

Leveraging the power of its brand, in 2010 Coca-Cola made a profit of almost $500 million in Australia alone. Marketing classrooms across the world study these heavyweight corporations, trying to understand how they make their companies stand out in a sea of competitors.

So what happens when charities are pulled into this competitive environment?

With governments around the world cutting back on support, charities have started to change. No longer able to rely on government resources, and with direct donations on the decline, not-for-profit organisations are looking to their corporate business compatriots for inspiration.

“Government just wasn’t supporting charities anymore, preferring to focus on core activities instead,” said Dr Helen Stuart, senior lecturer in marketing at ACU.

“The dominant logic of religious charities was to give care, but as competition for funds increased, charities had to become more corporate in their business approach.”

Focusing on the corporate rebranding of religious not-for-profit organisations, Dr Stuart is researching the issues that modern charities face when trying to communicate a definitive position in their new charity marketplace.

“Previous research1 has shown that the non-profit sector still holds onto a quaint image of small voluntary groups ministering to the needy, but the reality is that non-profit organisations are increasingly aware that they must reduce their services, operate more efficiently or find alternative sources of support to governments,” she said.

“The very notion of branding goes against the original ethos of how charities were set up – to actually care for people, no matter who they were. Now they’re forced to become business entities, or at least a hybrid of a business entity and social enterprise, in order to survive.”

The Brisbane academic is set to present at the 15th International Corporate Identity Group (ICIG) Symposium, a business and social sciences conference held at Aarhus University in Denmark. She will explore the complexities charities face when aligning a new corporate identity and corporate brand with their historical values.

“Creating a meaningful corporate brand isn’t easy, and many not-for-profits are reluctant to engage with branding, seeing it as a dirty word which might ultimately undermine the integrity of their mission,” Dr Stuart said.

“Branding also requires long-term managerial expertise and financial resourcing that many not-for-profits can’t afford. Expensive branding activities can alienate stakeholders who believe money should be used on core philanthropic activities.”

It can be a challenge for charities to adopt a corporate brand, because a new identity often has to be created to align all stakeholders. Donors, for example, may not want their donations to fund the organisation’s administration and marketing activities – an essential cost for any modern charity.

“Corporate branding is the organisational promise, communicating what the organisation stands for,” Dr Stuart said. “A coherent brand identity needs to be presented to different groups of stakeholders, who may have differing needs and interests in the organisation.

“The old-style volunteer, who believes that they’re doing it all for the charity, doesn’t really gel with the idea that the organisation is a business.”

In response, not-for-profit organisations have been forced to adapt. Christian Children’s Fund becomes ChildFund, St Vincent de Paul Society is shortened to Vinnies and children’s orphanages unite under the moniker MacKillop Family Services.

Even some op shops are dusting off their image, transforming from a humble Aladdin’s cave to attractive retail powerhouses.

“The concern is that in moving to a new business model, not-for-profits may lose the values that underpinned their success as organisations serving the community,” Dr Stuart said.

“Addressing this complexity to produce a meaningful corporate brand will be a significant issue for charities into the future.”

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