As featured in Third Sector, by Max du Bois.

According to the Charity Commission’s latest statistics, the number of charities in England and Wales is still increasing, growing steadily year on year since the financial crash and outstripping revenue growth. 

Many outside the sector, and some inside it, argue that this duplication is wasting money and effort that should go to much larger players of scale or to niche providers who are closer to their stakeholders. 

Similar patterns occur in the commercial sector. As sectors mature, their organisations can go one of two ways. They either gain sufficient momentum to dominate or they become niche. If they fail in either of these strategies, they find themselves with little differentiation, resulting in a lack of financial clout to compete effectively. This leaves them in the squeezed middle. Their choice then is to either merge or find their niche.

As a consequence, we are seeing an increase in mergers between charities as collaboration becomes key to their survival and effectiveness. Yet this alone is not sufficient. The new landscape in which charities operate requires much greater differentiation if they are to cut through the sheer noise of the sector.

Charities now need to build sustainable income businesses. To do this, they first have to define what makes them unique. The support and development organisation formerly known as CSV achieved this by embracing the transformational value of social impact volunteering and turning it into its driving brand principle: Volunteering Matters.

The mental health charity Richmond Fellowship, on the other hand, sought partnerships around a powerful set of common beliefs. Theirs was a bold ambition to create a new offering, not only to advance its businesses but also to drive forward its cause with partners such as the alcohol, drugs and gambling charity Aquarius, the mental health history project My Time, the Cumbria mental health charity the Croftlands Trust and the social business support organisation CAN, combining complementary skills and resources. [Update: the new brand for this group of charities is Recovery Focus].

In both instances, effective brand positioning helped them claim territory. In the case of the Richmond Fellowship collective, it became a tool to articulate a differentiating organisational strategy. Volunteering Matters used its new branding to reach out and inspire all stakeholders – from staff to commissioner, from decision-makers to the public – to behave in ways that helped achieve goals. Its brands became a powerful and practical business tool.

Identifying why people should use a charity is about answering this thorny question: what would the difference be to the world around us if my charity didn’t exist? – and making sure the answer is distinctive and relevant. By looking from the inside out – defining what gives a particular charity its reason to exist – is where clever branding starts.

Branding might have been deemed a luxury a few years ago; now it is strikingly apparent that it is a strategic investment that amplifies every touchpoint of the charity. From service delivery to tendering, from fundraising to campaigning.

It might not always be a ground-breaking distinction, yet coupled with the right focus on audiences and organisational objectives, a charity can begin to extract and define a relevant and engaging brand position that will help it carve out its own unique space. When Concern championed tackling hunger this was not the fundraising tactic so loved of the development sector; this was a well thought-out strategic focus to create differentiation.

Using brand to defend and grow a charity is the first step towards shifting away from the obscurity and danger of the squeezed middle and becoming a voice with its own message and meaning. And it is this focus, this sharpening of a charity’s key messages, that creates the competitiveness that enables it to vie for share of services, share of mind and share of income.