Market orientation in the nonprofit sector

Abstract

As the nonprofit sector moves into a more competitive environment it is being required by the community to become more efficient and effective. One response is for nonprofit organisations to become market oriented, which is the familiar response in the for-profit sector. Two components of market orientation, that is market segmentation and customer oriented products, fit well within the peculiarities of a nonprofit organisation. This is usually accompanied by the desire to obtain a competitive advantage causes problems for various stakeholders within the organisation. This paper contends that three factors, management, scarcity of resources, and conflict between organisational objectives and market orientation, are major influences on the adoption of a market oriented culture for a nonprofit organisation.