Get Grounded
Theory of
Change
Social Enterprise Design
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Is the idea a concept?
Social Enterprise
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Understand:
Nature of social problem
Needs/limitations of clients
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Where to begin
• Clarify your business and its goals
• Build scenarios
• Play it out your idea
• Identify deal breakers
• What will make or break your business
• Money, laws, partners, etc.
• Identify key design influencers
• Competitors, industry dynamics, regulatory
environment, demand, required resources
• Reality Test
• Objective feedback
• Quick Market Test
• Benchmarks
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Pare it down
• Scope
• For most SEs scope is a practical issue of $
• Location; (other resources) have’s have nots;
• Time
• Strategy
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Low hanging fruit
Window of opportunity
Proof of concept/display
Inflection point for impact
• Assumptions
• Informs market research
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Social Enterprise
Business Concept Discussion
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Best way to learn about markets?
Start selling
Test market
Pilots
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Marketing Videos
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What is a Value Proposition?
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Identifies
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Explains
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cost and benefits
how that combination is superior to other choices
A value proposition is NOT
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target market
opportunity
a mission statement
an elevator pitch
= A sales pitch; Unique Selling Proposition
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Creating your Value Proposition
Asserts the
VALUE of the
offering
For:
List target customers or beneficiaries. Group them
and ultimately define THE customer or beneficiary.
Who:
Define the need or opportunity. What is critical issue?
The:
Name your product, service or concept. Place the
product, service, or concept into a generally
understood category
That:
Quantify the benefits of the product, service, or
concept. Identify the single most compelling benefit
Unlike:
List the competitors and competitive alternatives –
Our:
Differentiate the product, service, or concept. Set it
apart from the competition.
POSITIONS
the value
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Example: IDE India
small scale rural farmers using
surface irrigation
Who: lose over 50% of usable water
to surface runoff annually
The: IDE-India low-cost drip
irrigation system is an
advanced irrigation device
That: inexpensively and completely
eliminates water loss from
surface irrigation
Unlike:currently used, expensive and
large-scale drip systems
Our: product is a customized,
modular and scalable system
that consistently reduces water
loss and increases farmers’
yields
For:
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For:
List target customers or beneficiaries.
Who:
Define the need or opportunity, i.e.
what critical issue for customer or
beneficiary?
The:
Name the product or service or
concept and place the product,
service, or concept into a generally
understood category.
That:
Quantify the benefits of the product,
service, or concept. Identify the
single most compelling benefit
Unlike: List the competitors and competitive
alternatives
Our:
The primary differentiation of the
product, service, or concept.
Marketing Mix in SE Context
• Availability - Product
• Product/service does not exist
• Collateral free micro-loans
• Eyes on Four Paws
• Affordability – Price
• Product/service exists but is too expensive
• moneylenders (interest can be 200% of loan)
• Aravind
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Marketing Mix in SE Context
• Access – Distribution
• Product/service exists but customers do not have
access
• Banks and formal financial markets
• NOTE: access to markets or undeveloped markets often major
barrier for SE clients.
• Vision Spring
• AWARENESS - Promotion
• Product/service exists but customers do not know that
it exists
• Information on meetings in markets
• Kickstart
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SE Marketing Considerations
• Educational marketing
• Market development
• Undeveloped/fragmented markets, poor market
infrastructure
• Barriers to reaching clients through
traditional marketing vehicles:
• Literacy, language, social & physical isolation,
fear and distrust, etc.
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More…
• Communications /PR efforts to educate SE
stakeholders:
• Community, donors, public, etc.
• Demand Imbalance
• Wants/inability to pay
• High costs
• Marketing cost/demand imbalance major
reason for private sector market failure
• Cultural context
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What’s in a name?
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Your marketing message is not your
mission
Why will a customer buy your
product or service more than
once?
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“Baking with a difference”
All-natural bakery products from scratch. We mix
small batches of fresh, premium ingredients and
finish each product by hand to create irresistible
desserts.
Rubicon stands for more than fabulous desserts: we are part
of a nonprofit organization, Rubicon Programs, that helps
individuals in the San Francisco Bay Area overcome
economic and social hurdles. Rubicon provides training,
housing, employment and support services to people in
need. You can feel good about buying Rubicon products
because you in turn support your community.
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Customers buy Benefits
TOLPA PB
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Microfinance
Features
Benefits
Features
Benefits
High in protein
Good nutrition
Working capital
loans
Vehicle to grow
business
Slightly sweet
flavor
Kids love it; easy
for parents
Weekly
repayment
Easy to pay back
100% natural
Peace of mind
Collateral free
Access
Expiration date
Guaranteed
Freshness
Solidarity groups
Peer support
Plastic container
Convenient
reusable
Short loan cycles
Lower risk
Produced by low
income Haitians
Feels good; make Easy application
a difference
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Low stress
#1 Marketing Vehicle
How to incite?
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Most common price strategy
challenge for a social enterprise?
Inability to Pay
Third party payer
Payment plans
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Watch out for subsidies in price!
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Volunteer time
ED + time on SE
Wage premium
Wastage
Lower employee productivity
Time spent on employee personal
problems/social programs
Higher insurance rates
Supervisory staff (i.e. job coaches)
turn over
Time for SE fundraising
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SE Distribution
• Distribution strategy is often a key for
social enterprises that serve clients with
barriers to ACCESS:
• Markets, Jobs, Information, “public services” –
health, education, water, utility etc.
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Distribution - Eyeglasses
Method/market
Rural
poor
Mobile vans
X
“Vision Guardians”
X
Micro-entrepreneurs
X
Chemists
Direct Sales &
Franchise partners
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Urban
poor
Factory
Workers
Chemist
Partner
NGOs
X
X
X
X
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X
X
X
X
Distribution Channels
Manufacturer
(China)
District Coordinator
Vision
Entrepreneur
End Customer
VE
Channel
End Customer
Wholesale
Channel
Scojo
India HQ
Pharmacy/Retail
Partner Organization
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Partner Vision
Entrepreneur
End Customer
Franchise
Partner
Channel
SE Marketing Pitfalls
• Confuse marketing message and mission
• Confuse need and demand
• Assume customer loyalty can be built on social
good instead of quality
• Build it and they will come – failure to market
• Lack capacity/acumen - inability to deliver on
basics
• Failure to listen to customers/watch the market &
incorporate feedback
• Inappropriate marketing vehicles for reaching
customers
• Confuse “payer” & “user” / clients & customers
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SE Marketing Practice
• Creative/unconventional and “traditional” marketing
approaches
• Take business to clients – emphasis on distribution
• Price and payment of services based on clients’ abilities
to pay or third party payer
• Quality, Consistency, Reliability are king
• Brand
• Market penetration is key - Test market new products
• Accurate price
• Flexibility and responsiveness
• Social benefit +
• Mission leverage
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