8 Ways Even Small Nonprofits Can Do Market Research

Affordable Ways to Get Feedback

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How to Go From What You Think to What You Know

I was convinced of the beauty of market research early in my career. I was working for a Girl Scout organization in the Midwest when our annual cookie sale was disrupted and ruined by suspicions of package tampering.

After we had landfilled several tons of cookies, the financial loss was substantial since the cookie sale represented more than half of our annual budget.

We thought that the public's fear of possible tampering would devastate our next sale. However, a telephone survey revealed that the public wanted to buy our cookies and seemed undaunted. But parents and the Girl Scout leaders were worried and reluctant to let the girls participate.

Instead of spending time and money to shore up the confidence of the public, we reassured and educated our volunteers, parents, and girls. It worked, and we went on to a successful cookie sale.

The board and ED were smart in this case. They believed the data over their gut feelings. That is not always the case. One study of CEOs revealed that only ten percent would follow the data if it contradicted their gut feelings! That's called confirmation bias, and it can be deadly. 

Fortunately, your nonprofit can fight back, especially since there are many ways of doing market research, some quite affordable. 

8 Affordable Ways to Do Market Research

  1. Observation
    1. Just paying attention to your clients and customers can be enlightening. Train your marketing personnel to observe and take notes on what people say at meetings, activities, and special events. Ask staff or volunteers that work with your public to tell you what people are saying. What problems seem to be occurring? What pleases and what irritates your users?
  2. Mystery Shopping
    1. Commonly used in commercial settings,  mystery shopping can be useful for a nonprofit too. It is an exceptionally useful technique for arts organizations where mystery shoppers can buy tickets or call ticket sellers, attend performances, and judge the level of customer service.
    2. The shoppers might even do the same with your competing organizations to see what they are doing differently and perhaps better. Educate your people who are in customer-facing jobs about the mystery shopping ahead of time and make sure that they don't see it as a way to "catch" and punish them.
    3. Devise a rating system that the mystery shopper can use to quantify their impressions and to make sure everyone is evaluating similarly.
  1. Transactional Surveys
    1. We've all taken these. Surveys often show up in the course of or immediately after a customer transaction.  Typical examples are when a box shows up on our computer screen asking us to answer a survey after we've ordered an item online. Or, when we get a phone call from a company we just did business with checking out our satisfaction level.
    2. Nonprofits can use surveys many ways, from emailing it to donors or volunteers to on-site questionnaires to a short series of questions on a website or right after someone donates.
    3. Surveys such as these allow us immediate feedback while the experience is fresh in the consumer's mind and enables us to take prompt remedial action if necessary.
  1. Focus Group Research
    1. Focus groups can be informal and run by your staff or formal, and more expensive when done by a company skilled in doing them. Focus groups should have a skilled moderator, and there should be several focus groups for each segment of clients you are researching.
    2. Focus groups invite a small group of people for a meeting of a couple of hours to answer questions and discuss their reactions to your organization or something that your organization does. These groups can be held in a specially designed room so they can be observed, they can be recorded for later analysis, or they can be held in a digital space.
  1. Customer Advisory Panels
    1. Advisory panels work well for organizations that have traditional "customers." Arts organizations are good examples where tickets are sold. People from various customer groups are invited to serve on the panels for a period.
    2. Feedback comes through meetings, phone interviews and mailed or emailed questionnaires. Customer Advisory Panels are beneficial for gathering information needed to make a significant decision. Perhaps the organization is thinking of mounting a particular kind of performance series and can reach out immediately to find out what the panel thinks of the idea.
  1. Individual In-Depth Interviewing
    1. Specially trained researchers make phone calls,  ask follow-up questions and prompt for detailed information. This type of research can be expensive, but the results can be immensely helpful. It can save money by steering your organization away from wasting resources on hunches that might not be correct.
  2. Survey Questionnaires
    1. Probably the most widely used of market research techniques, surveys can be sent to a large number of people. Questionnaires can be transmitted by mail, e-mail, or tucked into other literature such as a program or a newsletter. Today, there are many online survey services, and some are even free to use.
    2. Surveys are useful for learning about people's knowledge, beliefs, product and media preferences, their satisfaction levels, and for attaining demographic information.
  1. Marketing Experiments
    1. Commercial enterprises do this all the time. They test direct market materials for instance by sending out various versions and then tracking the responses. Often called A/B testing, you can quickly do the same by merely preparing different versions of materials such as promotional brochures, fundraising appeals, and newsletters and sending them to different segments of your audience. You then track the responses to see which version worked best.

Quantitative or Qualitative Research?

Whatever techniques you use to research, you’ll need to decide when to use qualitative or quantitative approaches Most significant research projects have a blend of the two. Briefly, here is how the two types are different and where they might be useful.

Quantitative methods measure or count data. They attempt to answer the question: "How much?" using statistical analysis such as averages, means, percentiles, etc. Use quantitative methods for issues that involve:

  • Understanding quantities or frequency.
  • Determining cause-and-effect.
  • Comparing different things.
  • Establishing numerical baselines.

Qualitative methods use direct or indirect contact with people. They can consist of interviews, observation, or review of relevant documents. Qualitative methods can be quite rigorous and be excellent for studying processes and meanings, but they do not measure. Use qualitative methods for questions that involve:

  • Understanding the feelings or opinions of people.
  • To gain insight into relationships or patterns.
  • To gather multiple perspectives on a particular subject or problem.
  • To identify approximate, rather than exact, information.

Don’t hesitate to do market research. Your nonprofit is a business in many respects, so you need to understand your audience. Research seems like an expense, but it saves you money in the long run by avoiding mistakes in planning and carrying out your programs.


Arts Marketing Insights, Joanne Scheff Bernstein, 2007, John Wiley.

Strategic Marketing for Nonprofit Organizations, Alan R. Andreasen, Phillip Kotler, 2008, Seventh International Edition, Pearson Prentice Hall.