The linear and nonlinear properties of the stilbazolium derivative, 2-[2-(3-hydroxy-4-methoxy-phenyl)-vinyl]-1-methyl-pyridinium naphthalene-2-sulfonate dihydrate crystal (VSNS), were investigated using an iterative electrostatic embedding scheme and density functional theory (DFT). The dipole moment and second hyperpolarizability of the VSNS molecule are sharply influenced by its crystalline phase. Standard DFT global hybrids such as B3LYP and M06 are strongly benefited by the effects of crystalline polarization. The performance can be further improved by making small changes in the amount of Hartree-Fock exchange included in the hybrid, delivering good hyperpolarizability and spectroscopy.