Why Funders Should Take the Lead in Funding Communications

Social impact organizations know they need to invest in communications and marketing. They understand that doing so has the potential to make a major difference in their ability to meet fundraising goals and maximize impact. But they also know that embracing communications is likely to be an uphill battle. They know this because communications is chronically undervalued and under-resourced in the impact space.

The average social impact organization has slowly cobbled together a piecemeal communications program with little to no funding to back it up. Most wouldn’t dare ask their funders to explicitly earmark money for this purpose. Communications is viewed as overhead — and organizations know it’s best to present a trim figure in that category. Unfortunately, nonprofits are often ranked based on how little of their budget is devoted to overhead and operations. As a result, they’ve been conditioned to expect and make do with much less than they really need.

Funders have a unique opportunity – more than that, a responsibility – to reverse these tides. They must lead the charge in supporting a new wave of communications for good. Doing so will mean stronger, more impactful organizations. And it will mean more effective philanthropy, too.

The Case for Communications in the Social Impact Space: Impact, Not Overhead

When communications get lumped into overhead, that’s an indication that the true value of communications isn’t understood.

The reality is that nonprofits are in a relentless competition for attention, funding, and talent. They must compete with other social impact organizations and with profit-driven companies, too. In order to make themselves known (and be heard), they must insert themselves in the marketplace in many of the same ways for-profit organizations do.

Communications is a necessary ingredient for success. More than that, it should be thought of as an impact-multiplier. We all implicitly agree that this is so when we think about profit-driven companies. As proof, consider the fact that investors don’t routinely get up in arms about what percentage of a for-profit company’s budget is devoted to marketing. They just care about the value that is created for each dollar spent.

Funders in the impact space should take a similar stance when it comes to communications. And for good reason. Social impact organizations that are able to invest in communications ultimately grow stronger and more effective in multiple ways. The benefits include:

• Expanded organizational capacity and capabilities. When money is allocated appropriately to communications, staffers with other full-time responsibilities are no longer expected to take on communications activities in their spare time. On top of that, bringing more marketing and communications expertise to the table (whether in-house or in the form of external partners) also expands an organization’s skillset in a way that may be applicable across other, program-related activities.
• Increased donor engagement and more effective fundraising. Organizations with robust communications plans are better able to convey what they are about (their mission), how they approach their work (their theory of change), and what they are accomplishing on an ongoing basis (impact reporting and benchmarking). All social impact organizations must document these basic elements. But communications-savvy organizations translate them into a compelling impact story that inspires action on the part of donors. These stories draw out the human and emotional elements of a cause, which lay the foundation for donors to establish a deeper connection to the organization telling the story. This, in turn, leads to sustained giving and longer-lasting engagement.
• A more diverse and sustainable revenue stream. Organizations that are more successful in fundraising are less reliant on institutional and grant funding. By allocating funds for communications, funders can proverbially teach organizations how to fish.
• An expanded network. Organizations with stellar communications do a better job of relaying to the world who they are and what they are trying to achieve. By broadcasting their impact stories with a clear message and strong signal, organizations can find more synergistic partners, collaborators, and staff to help further their missions.
• Increased brand awareness and top-of-mind status. The best communications plans include content marketing. When organizations are able to consistently produce and promote quality content, they gain greater brand awareness and top-of-mind status among key audiences.

How Funders Can Expand the Role of Communications for the Organizations They Support

Institutional funders have traditionally played into the push for exceptionally low overhead. However, there are signs that this is changing.

New Philanthropy and proponents of Effective Altruism are shaking up the philanthropy space and challenging the status quo. Modern funders interested in achieving the highest possible impact per dollar. But they recognize that this doesn’t necessarily translate to lower overhead in every instance. Funders from the tech and corporate worlds also understand firsthand the need for good marketing and communications. And they naturally extend that lesson to the world of social impact.

Regardless of their background, all funders are in a unique position to help social impact organizations beef up their communications activities and skills. The role of funders should ideally be similar to that of venture capitalists. They should nurture and advise the organizations they support. The goal, of course, is to set their recipient organizations up for success. Just as a venture capitalist would make sure their startup had a marketing team and growth plan in place, funders should proactively insist on a realistic communications budget for the organizations and programs they support.

Here’s a rundown of the ways funders can approach communications budgeting:

• Unrestricted funding at the organizational level. From the perspective of social impact organizations, this is the gold standard. In this approach, funders provide unrestricted, lump-sum, long-leash funding to effective and trusted social impact organizations with a strong theory of change. The organizations then sequester a portion of the funding as needed for communications.
• Standalone communications funding. If unrestricted funding isn't an option, the next step down would be to provide organizations with a standalone communications budget that isn’t tied to any specific program or project.
• Program-specific communications funding. If a separate communications budget isn’t possible, then funders can provide additional communications funding at the program or project level.
• Additional support. Finally, funders (especially those with expertise in communications) can offer their guidance in terms of putting together a comprehensive communications plan and finding the right people to help execute the plan.