Revised conceptualization of the concept of public sector marketing

Edouard V. Novatorov, Ph.D

Associate Professor, Department of marketing,

National Research University

Higher School of economics

St. Petersburg, Russia

Tel- +7(911)-210-7188

enova@mail.ru

Although the concept of non-profit sector marketing has been widely embraced by marketing academics, many scholars and managers in the non-profit field remain skeptical. Skeptics of the appropriateness of the marketing concept in the non-profit field argued that its application distorted a non-profit organization's objectives, antithetical to its social service ethic, and invited inappropriate commercialization of non-profit services

P. Kotler and his associates modified existing political communication and public advertising theories to formulate the marketing approach comprised of the "4 Ps" model, voluntary exchange, and the marketing philosophy of meeting customers’ needs. This explanation of the notion of marketing resulted in the term "social marketing".

In 1972, Kotler formulated his broadened, generic, and axiomatic concept of marketing that was conceptualized as being universal for any type of product or organization including non-profit organizations. Three major principles underling the school's conceptualization of non-profit marketing: An open-system model of formal organizations, borrowed from organizational theory and the concept of social exchange, adapted from individualistic sociology.

An alternative explanation can be based on:

A closed-system model of formal organizations.The closed-system perspective is older stemming from Weber's classical analysis of bureaucracy.

"Coercion mutually agreed upon " motivation

Self-interest motivation has limited usefulness in context of non-profit organizations. In many contexts it is antithetical to the philosophy of non-profit services and, hence, is inconsistent with a legitimate conceptualization of non-profit marketing. The application of self-interest motivation is integral to the social exchange school of marketing, but in the context of non-profit agencies it is inappropriate.

Reciprocity and Redistribution. The relationship of formal organizations with their environments can be explained not only from an exchange perspective but also from reciprocity and redistribution perspectives. This perspective attempts to analyze economic life in primitive and modern societies from three different approaches: reciprocal arrangements based on the symmetry principle; redistributive arrangements based on the centricity principle; and marketing exchange arrangements based on price-making markets.

A revised conceptualization of non-profit marketing Based on the previous analysis, the following definition of non-profit marketing is offered:

Non-profit marketing is the analysis, planning, implementation and evaluation of nonprofit services, designed to facilitate reciprocative arrangements within a community or target publics that were established by a grant-givers, and expedited by qualified personnel who are committed to pursuing them in the mission interest.

This definition suggests that the task of non-profit manager is to accept the mission and objectives set by grant-giver and operate within the parameters and priorities.

To characterize marketing in the non-profit sector and to distinguish it from the traditional "exchange based marketing" which accurately conceptualizes marketing in the for-profit sector, it may be appropriate to adopt the term "grant-giver marketing" or "grant away marketing".