Associations’ Non Dues Revenue Puzzle
Associations must keep pace in salary, benefits and member service offerings in order to remain competitive. While there is general agreement that membership renewals and new member growth are essential for Associations, there is a growing need for alternate revenue streams, too. Non dues revenues are increasingly more important for CEOs, Senior Managers and Boards of Directors’, they see the need to grow and understand there is no easy answer.
Definitions of non dues revenue are different from one Association to another. In some cases Training, Education, Digital Published Information and Conferences all contribute to revenue streams. However the definition and the focus of the revenue stream must be data based and member focused.
Yes, Associations can increase revenues but first they need to define and understand the existing member market first. In “Profit From the Core, Growth Strategy in an Era of Turbulence” Chris Zook and Jim Allen, copyright 2010 Bain and Company(updated edition), the authors present a compelling review process whereby a business develops boundary definitions, and determines marketplace differentiation to define new revenue growth opportunities.
Non Dues Revenue Checklist
Data Driven Strategies, Core Connections and Member engagement are as effective in identifying and growing non dues revenues as they are in retaining and recruiting new members. Boards utilize similar processes inside their companies and will appreciate the same thoughtful and deliberate approach at their Association:
1. Data Driven Strategies – Identify member business objectives, determine products, services, education, training, standards and certification that enhance member market performance. Conduct competitive market analysis understand what other Associations offer, conduct beta tests and develop robust offering which complement a strong policy, advocacy and regulatory offerings.
2. Core Connections – The strategic partnership is enhanced with a suite of value added resources. Associations can reinforce their credentials as a destination location with the most appropriate services.
3. Member Engagement – As is the case with policy and advocacy engagement members want to know they have an impact on outcomes. Provide opportunities to test new products and services and engage them in developing and designing your new offerings.
Associations should continually evaluate the efficacy of their offerings. This process will help keep non dues revenue initiatives focused on member business objectives.
Associations Can Profit from the Core
Yes it really works! Associations are devising and developing leadership roles that complement their policy and advocacy work:
The Air Conditioning Contractors of America (ACCA) leads the HVAC industry with research and technical materials as well as online training.
Technology Association of Georgia (TAG) continually creates Societies to help their members address arising business needs.
National Institute of Investor Relations (NIRI) is building a certification program for its global membership.
A number of Associations note that networking is a key element of the non dues revenue value proposition. In a number of cases, Associations utilize registration software allowing members to make networking appointments ahead of time.
Associations’ Non Dues Revenue Puzzle
When it comes to non dues revenue the Jerry McGuire “Show Me the Money” approach is a non starter. Why? Market competition, the rise of single issue coalitions and new Associations. Members expect connections to their business objectives, especially on products and services. Or they will vote with their check book and seek other solutions.
Market turbulence is now a part of the business landscape for Associations which means, any new products require the same type of due diligence before they go to market. Although there are no quick fixes, there is at least a method to make and build a case for products or services that add to member success.