I have had a number of requests for copies of some recent articles and presentations. I love to get emails, but to save time, I have put the most requested items online for easy downloads. So here they are:
Raise Dues without Lowering Membership, Forum magazine, March, 2008. As we face more inflationary pressures, you may be faced with raising prices or dues. Here is the feedback I received from over 300 association professionals on the best practices in this area.
Improving Your Membership Renewal Program, presented at ASAE and the Center’s 2008 Marketing and Membership Conference. Membership retention is foundational in membership development. This presentation includes both theory and case studies from one of my colleagues and our clients.
The Optimized Membership Program, MGI White Paper, June, 2007. Sometimes in membership marketing, it helps to step back and look at your entire program. This white paper covers each of the major areas in getting and keeping members.
The Economics of Membership, presented at the DMAW Association Days. I cannot understate how important it is to grasp the financial aspects in membership development. Understanding and being able to calculate renewal rates, membership tenure, lifetime value, the steady state of membership, and your maximum acquisition cost or membership margins are the key tools to succeeding in our profession. They are outlined in this presentation.
Hope you find these helpful. Feel free to post any questions or feedback.
My Summer Reading
The first day of summer in the northern hemisphere is the day of the year when the sun is the farthest north. This is June 21st. I love long summer days, so it is a great time of year for me.
Since summer is ready to begin, I am ready to pick out a book for my summer reading. I am a slow reader, so it will be just one book this summer.
Should I pick a witty and humorous novel or a top business book on social networking? How about reading a historical or biographical tome like the 944 page Team of Rivals, by Doris Kearns Godwin (my very enjoyable summer reading a couple of years ago)? No, my pick this year is the Handbook of Christian Apologetics: Hundreds of Answers to Critical Questions by Peter Kreeft and Ronald K. Tacelli.
Here is my thought, what bigger questions are there to consider than some of the following issues:
- The existence of God
- Faith and reason
- Providence and free will
- Miracles
- The problem of evil
- The Bible's historical reliability
- Life after death
- Heaven and hell
- Salvation
- Christianity and other religions
- Objective truth
I have some ideas on a number of these issues. But as I have been asked questions lately by my very inquisitive daughter, I have come to see that I do not know as much as I think I do.
So it is back to the books: A look at some of the deeper questions about life.
What will you be reading this summer?
Case Study: Does this Marketing Stuff Really Work?
Can negative membership trends really be turned around through putting membership marketing best practices in place? Can marketing really make a difference even if the value proposition, dues pricing, and product offerings don’t change?
The answer is YES!
Clearly, any non-profit should offer the best value, optimum price and top product that it can. But just fixing the marketing component can have a big influence.
That’s why I appreciated the presentation done by Lori Jordan, Director of Association Services, for the Water Environment Federation (WEF) at the ASAE and the Center’s recent Marketing and Membership Conference.
According to her presentation, WEF had seen membership consistently decline beginning from 2001 to 2006. However, over the past three years through the deployment of an aggressive membership acquisition program and development of a multi-channel, high frequency renewal system, WEF membership began to climb.
In addition to adding new members through acquisition efforts, the new renewal system has helped the retention rate increase by an impressive 7 points.
The WEF story is an encouragement that there is hope for organizations that are experiencing a membership decline. If you would like a copy of the full presentation, please send me an email. My address is on the sidebar of the blog or you can reach me through LinkedIn.
In full disclosure, please note that WEF has been a client of my firm, Marketing General, Inc., for the past three years.
What successful turn around stories have you seen? Please feel free to share your comments.
The answer is YES!
Clearly, any non-profit should offer the best value, optimum price and top product that it can. But just fixing the marketing component can have a big influence.
That’s why I appreciated the presentation done by Lori Jordan, Director of Association Services, for the Water Environment Federation (WEF) at the ASAE and the Center’s recent Marketing and Membership Conference.
According to her presentation, WEF had seen membership consistently decline beginning from 2001 to 2006. However, over the past three years through the deployment of an aggressive membership acquisition program and development of a multi-channel, high frequency renewal system, WEF membership began to climb.
In addition to adding new members through acquisition efforts, the new renewal system has helped the retention rate increase by an impressive 7 points.The WEF story is an encouragement that there is hope for organizations that are experiencing a membership decline. If you would like a copy of the full presentation, please send me an email. My address is on the sidebar of the blog or you can reach me through LinkedIn.
In full disclosure, please note that WEF has been a client of my firm, Marketing General, Inc., for the past three years.
What successful turn around stories have you seen? Please feel free to share your comments.
Managing Global Membership – One Organization’s Philosophy
ASAE and the Center’s Marketing and Membership Conference had some very useful sessions.
I found comments from Dan Rex, Deputy Executive Director and Director of Communications and Marketing for Toastmasters International to be particularly of interest.
He spoke about his organizations global growth and the philosophy that they have followed. Toastmasters “now have nearly 226,000 members in 11,500 clubs in 92 countries.”
It appears to me from the presentation that Toastmasters is following a pretty tightly controlled global strategy. For example, Toastmasters has resisted the temptation to establish offices outside of the US. All staff is based out of their California office.
Additionally, they have made the decision to provide limited customer service hours from 8:00 am to 5:00 pm Pacific Time and customer service is only in English. Their policy states that “Toastmasters International does not have the World Headquarters staff resources or financial sources at this time to provide oral or written translation services. Communications sent to or sent by World Headquarters will be in English. It is understood, however, that change to policy will be considered in the future as the translation environment changes.”
Toastmasters has done only limited translation of their extensive materials driven by specific numbers of clubs in a language group. I saw Spanish, French, and Chinese transitions on their web site. Wisely, Toastmasters also tightly their trademark and copyrights with a clearly outlined policy and pro-active enforcement.
They do, however, give volunteers and prospective clubs many downloadable tools and resources to help them get started. In essence they have made membership self service through the web. And volunteers from around the world have been the key to launching new clubs and producing their growth and success.
By the way, here is a link to their 10 Tips for public speaking.
What do you think of the global membership philosophy employed by this group?
I found comments from Dan Rex, Deputy Executive Director and Director of Communications and Marketing for Toastmasters International to be particularly of interest.
He spoke about his organizations global growth and the philosophy that they have followed. Toastmasters “now have nearly 226,000 members in 11,500 clubs in 92 countries.”
It appears to me from the presentation that Toastmasters is following a pretty tightly controlled global strategy. For example, Toastmasters has resisted the temptation to establish offices outside of the US. All staff is based out of their California office.
Additionally, they have made the decision to provide limited customer service hours from 8:00 am to 5:00 pm Pacific Time and customer service is only in English. Their policy states that “Toastmasters International does not have the World Headquarters staff resources or financial sources at this time to provide oral or written translation services. Communications sent to or sent by World Headquarters will be in English. It is understood, however, that change to policy will be considered in the future as the translation environment changes.”
Toastmasters has done only limited translation of their extensive materials driven by specific numbers of clubs in a language group. I saw Spanish, French, and Chinese transitions on their web site. Wisely, Toastmasters also tightly their trademark and copyrights with a clearly outlined policy and pro-active enforcement.
They do, however, give volunteers and prospective clubs many downloadable tools and resources to help them get started. In essence they have made membership self service through the web. And volunteers from around the world have been the key to launching new clubs and producing their growth and success.
By the way, here is a link to their 10 Tips for public speaking.
What do you think of the global membership philosophy employed by this group?
Great Summer Meetings
Graduations are finishing up. That means it is now summer!
What are you doing for professional development this summer? There are some great events coming up that – based on your location and interests -- you may want to consider attending. I have listed them below in alphabetical order.
AAMSE - Advancing Professionalism in Medical Society Management. The AAMSE Annual Conference is in Minneapolis, MN, July 23-26, 2008.
ASAE & the Center for Association Leadership. The Annual Meeting and Exposition, San Diego, CA, August 16-19, 2008.
Association Forum of chicagoland. Association Week 2008, June 17-20, 2008.
CESSE - Council of Engineering and Scientific Society Executives. The CESSE 2008 Annual Conference, Detroit, MI, July 15-18, 2008.
What are you doing for professional development this summer? There are some great events coming up that – based on your location and interests -- you may want to consider attending. I have listed them below in alphabetical order.
AAMSE - Advancing Professionalism in Medical Society Management. The AAMSE Annual Conference is in Minneapolis, MN, July 23-26, 2008.
ASAE & the Center for Association Leadership. The Annual Meeting and Exposition, San Diego, CA, August 16-19, 2008.
Association Forum of chicagoland. Association Week 2008, June 17-20, 2008.
CESSE - Council of Engineering and Scientific Society Executives. The CESSE 2008 Annual Conference, Detroit, MI, July 15-18, 2008.
DMAW - Direct Marketing Association of Washington. The 2008 Bridge Conference, Washington, DC, July 23-25, 2008.
The summer calendar did not yet appear to be on the web site for NYSAE. Use the link to check for updates from NYSAE - New York Society of Association Executives.
Either I or one of my colleagues will be speaking at or attending all of these events. Feel free to comment below on the meetings that you plan to attend and share your recommendations from past conferences.
Yes, that is my son -- pictured above -- speaking at his high school graduation and my daughter in the foreground signing for the deaf and hearing impaired.
What is my Career? Membership Development is Relationship Marketing
Do you work in membership development, membership retention, or membership marketing? If you do, you may have trouble explaining what you do to others, including prospective employers outside the non-profit or association fields.
I believe the answer to the question, “what is my career?” is that you are a professional engaged in “relationship marketing”.
The textbook description of relationship marketing from Philip Kotler follows.
“Relationship marketing has the aim of building long-term mutually satisfying relations with key parties – customers, suppliers, distributors – in order to earn and retain their long-term preference and business . . . The ultimate outcome of relationship marketing is the building of a unique company asset called a marketing network. A marketing network consists of the company and its supporting stakeholders (customers, employees, suppliers, distributors, retailers, ad agencies, university scientists, and others) . . . The operating principle is simple: Build an effective network of relationship with key stakeholders, and profits will follow.”[1]
If that sounds familiar it is because that is what we do.
Kotler goes on to describe the progression in relationship marketing as moving people through eight stages of relationship starting with “Suspects” and moving to “Partners”.[2] Here are his stages.
- Suspects
- Prospects
- First Time Buyers
- Repeat Customers
- Clients
- Members
- Advocates
- Partners
All of these stages have relevance in membership development. However, in membership we tend to shorten the cycle and bring people into the membership relationship sooner. The relational marketing progression that I have recommended to use for associations is pictured below. You can read about it in my post titled, Five Phases of the Membership Life Cycle.
Here is the bottom line. If you are involved in membership marketing, you have a very valuable and transferable skill. You have developed hands on experience of establishing, building, upgrading, and retaining a customer. You are a relationship marketer.
Glossary of Direct Marketing Membership and Circulation Terms
In membership marketing, we have picked up many terms that had their origin in circulation development. So today we use terms like “doubling date”, “soft offer”, “CPM”, “CPO”, “nixies” and “conversion”.
I just came across a good glossary of these terms that are very helpful to know and use. It is more effective for us to speak the same marketing language. The glossary was put together by Circulation Management Magazine.
Take a look at it and see how many of them you use or know.
I just came across a good glossary of these terms that are very helpful to know and use. It is more effective for us to speak the same marketing language. The glossary was put together by Circulation Management Magazine.
Take a look at it and see how many of them you use or know.
Membership Development Relies on Providing a Valuable Product
As a marketing professional, it is often a temptation to focus on promotional solutions to growth impediments. However, keep in mind that one of the four P’s of marketing is product.
You need to deliver value to succeed.
That’s why I like a quote I just read from Google’s CEO, Eric Schmidt. He says, “Innovation has nothing to do with downturns. A hot product will sell just as well in a recession as it will in a nonrecession . . . The strong companies understand this, and during a recession, they invest.”[1]
You need to deliver value to succeed.
That’s why I like a quote I just read from Google’s CEO, Eric Schmidt. He says, “Innovation has nothing to do with downturns. A hot product will sell just as well in a recession as it will in a nonrecession . . . The strong companies understand this, and during a recession, they invest.”[1]
Speaking of recessions, my colleague Erik Schonher (he is the Erik pictured above) just published an excellent White Paper entitled, Ten Tips for Membership Marketing in a Recession. It provides some very helpful advice. I will highlight it in an upcoming post. But if you would like me to send you an electronic copy now, let me know.
[1] BusinessWeek, May 12, 2008, page 54.
2008 Marketing & Membership Conference
If you find this blog helpful, you may want to consider attending the 2008 Marketing and Membership Conference. As of today, it looks like registration is still open on the ASAE web site.
The conference is May 29 and 30 and is being held in the Baltimore Convention Center, Baltimore, MD.
I will be there and would enjoy meeting you. I still look like my picture (right). Marketing General, Inc. will have a table top booth at the event, so you can connect with me there.
The conference is May 29 and 30 and is being held in the Baltimore Convention Center, Baltimore, MD.
I will be there and would enjoy meeting you. I still look like my picture (right). Marketing General, Inc. will have a table top booth at the event, so you can connect with me there.
What is Preventing Growth in your Organization?
In my May 6th post, I spoke about a recent workshop I ran with a group of non-profit religious organizations. My first point was to focus on the need for organizational growth and how marketing can be a tool that can help establish growth.
Our next area of discussion was how do we get an organization growing?
For one helpful perspective, we turned to Peter Senge. In his seminal book, The Fifth Discipline, one of his major themes is, “Don’t Push Growth; Remove the Factors Limiting Growth.”
I liken Senge’s concept to the garden with tomato and pepper plants I planted last week. My experience is that if I have properly prepared the soil and then water, weed, and fertilize the plants, then they will grow. However, if I neglect any of these, I will impede the growth or even kill my garden.
For my workshop audience I also shared a text from St. Paul which reads, “I planted, Apollos watered, but God gave the growth. So neither he who plants nor he who waters is anything, but only God who gives the growth” (1 Corinthians 3: 6-7). In other words, we are responsible for tending the garden, but we cannot “make” it grow.
Here is a real life example of what it looks like to remove the impediments to growth.
I met with an association this week that is experiencing a decline in membership. One of the programs that we have helped them with is to reinstate departed members. When I went through the results with them, immediately the impediment to their growth jumped out to us. The mailings that we did to recently lapsed members were generating between a 3.8% and a 4.9% response rate. And the telemarketing was producing over 10% response rates in paid credit card orders.
This meant that somewhere between 10% and 15% of their lapsed members did not actually want to leave!
What do you think their impediment to membership growth is?
Clearly there is not a problem of member value (lot’s of members wanted to come back), nor is it a problem of new member input (they added 30,000 members this past year). Their impediment was not effectively asking members to renew. Their renewal system had a leak and was draining growth potential from the organization.
I have found a secondary benefit of enabling growth by removing impediments is the focus it creates. An individual or an organization which is focused on solving one problem can usually do this effectively. We get lost when we try to do too many things.
Do you have any comments on this concept of removing impediments to enable growth?
Our next area of discussion was how do we get an organization growing?
For one helpful perspective, we turned to Peter Senge. In his seminal book, The Fifth Discipline, one of his major themes is, “Don’t Push Growth; Remove the Factors Limiting Growth.”
I liken Senge’s concept to the garden with tomato and pepper plants I planted last week. My experience is that if I have properly prepared the soil and then water, weed, and fertilize the plants, then they will grow. However, if I neglect any of these, I will impede the growth or even kill my garden.
For my workshop audience I also shared a text from St. Paul which reads, “I planted, Apollos watered, but God gave the growth. So neither he who plants nor he who waters is anything, but only God who gives the growth” (1 Corinthians 3: 6-7). In other words, we are responsible for tending the garden, but we cannot “make” it grow.
Here is a real life example of what it looks like to remove the impediments to growth.
I met with an association this week that is experiencing a decline in membership. One of the programs that we have helped them with is to reinstate departed members. When I went through the results with them, immediately the impediment to their growth jumped out to us. The mailings that we did to recently lapsed members were generating between a 3.8% and a 4.9% response rate. And the telemarketing was producing over 10% response rates in paid credit card orders.
This meant that somewhere between 10% and 15% of their lapsed members did not actually want to leave!
What do you think their impediment to membership growth is?
Clearly there is not a problem of member value (lot’s of members wanted to come back), nor is it a problem of new member input (they added 30,000 members this past year). Their impediment was not effectively asking members to renew. Their renewal system had a leak and was draining growth potential from the organization.
I have found a secondary benefit of enabling growth by removing impediments is the focus it creates. An individual or an organization which is focused on solving one problem can usually do this effectively. We get lost when we try to do too many things.
Do you have any comments on this concept of removing impediments to enable growth?
Using Discounts to Enhance Membership Retention
The other day on the ASAE List Serv, Scott Oser shared some interesting experiences from his previous employment at National Geographic. He outlined the results of marketing tests this organization had done on moving new members through the first couple years of membership.
Here is what he reported.
“While I was at National Geographic, we looked at renewals many ways but one was as follows:
- New subscribers--any one who had been a subscriber for less than a complete year
- 2-3 year subscribers--anyone who had already renewed once but less = than 3 times
- Renew b-4s--anyone who had already renewed more than 3 times
We created those groups based on the renewal trends we saw when analyzing response rates. Our most worrisome group was obviously the new subscribers. Their renewal rate was traditionally the lowest because the publication was not yet part of their regular life. The second most at risk group was the 2-3 year subscribers and obviously the highest retention occurred within the last group.
As with most publishers we offered a pretty deep discount to get new subscribers in the door. Through testing we found that hitting these people with a full price offer in their first year as a subscriber significantly hurt renewal rates. We therefore developed a step up pricing schedule where depending on source we held the low price the same for the first renewal, increased it slightly for years 2 and 3 and then increased it even more for all of the renew b-4s. I realize it sounds kind of crazy, but we were charging our most loyal subscribers the highest price because we knew they would pay it.”
Do you have any comments or feedback on this strategy?
Are Growth and Marketing Bad?
It might seem odd to start out a marketing workshop with this question, but it was how we got underway several weeks ago in a presentation I did.
That’s because, as I interact with the staff of some non-profits, I hear more often these days statements like, “we need to improve our services to our current members before we pursue growth”, “we already have the members who matter”, or related to marketing, “we don’t want to sell to our prospects and members they will be drawn to us by word of mouth if we only provide value.”
There is a kernel of truth in each of these statements, but they can also become the road to organizational disaster because they make stagnation and decline permissible instead of a warning sign it should be.
Here is the case that I made for growth in my presentation. Since the leaders I was speaking to were all associated with religious organizations, I decided to begin my discussion by drawing from the wisdom of some ancient religious texts.
The first taken from the Jewish Tanakh (an acronym for “Torah, Prophets, and Writings”) or the Christian Old Testament says: “And God said to them, ‘Be fruitful and multiply and fill the earth and subdue it and have dominion over the fish of the sea and over the birds of the heavens and over every living thing that moves on the earth.’”[1]
This is one of the first recorded commands. But even more, fruitfulness and growth almost seem to be woven into the DNA of mankind.
The second text says, “Now after a long time the master of those servants came and settled accounts with them. And he who had received the five talents came forward, bringing five talents more, saying, ‘Master, you delivered to me five talents; here I have made five talents more.’ His master said to him, ‘Well done, good and faithful servant.”[2]
Again, there is calling to take what we have been given and not bury it in the sand, but generate a good return or producing growth.
In a modern day context, Michael Treacy in his book Double Digit Growth puts the issue of growth this way, “Companies decay when they stop growing”.
I also shared with this group that there are some very practical reasons why growth is important. I highlighted some of these in my post Characteristics of Growing and Declining Associations.
When we look at marketing instead of growth issues, everyone can site poor, unethical, or ugly marketing examples. But these examples do not define marketing. Marketing is actually a tool – like a hammer. A hammer can be used to build a beautiful home or it can be used as a weapon. So the tool of marketing should not be judged by how one person or organization uses it.
Here is my operative definition of marketing: Marketing is the discipline of establishing a product and communicating it using the best message, to the best market segments, with the best marketing channels and techniques to maximize the return on investment.
Putting the best product in the best person’s hands in the best way should make sense for any organization.
Well that is my short defense of growth and marketing. Feel free to point out other perspectives.
That’s because, as I interact with the staff of some non-profits, I hear more often these days statements like, “we need to improve our services to our current members before we pursue growth”, “we already have the members who matter”, or related to marketing, “we don’t want to sell to our prospects and members they will be drawn to us by word of mouth if we only provide value.”
There is a kernel of truth in each of these statements, but they can also become the road to organizational disaster because they make stagnation and decline permissible instead of a warning sign it should be.
Here is the case that I made for growth in my presentation. Since the leaders I was speaking to were all associated with religious organizations, I decided to begin my discussion by drawing from the wisdom of some ancient religious texts.
The first taken from the Jewish Tanakh (an acronym for “Torah, Prophets, and Writings”) or the Christian Old Testament says: “And God said to them, ‘Be fruitful and multiply and fill the earth and subdue it and have dominion over the fish of the sea and over the birds of the heavens and over every living thing that moves on the earth.’”[1]
This is one of the first recorded commands. But even more, fruitfulness and growth almost seem to be woven into the DNA of mankind.
The second text says, “Now after a long time the master of those servants came and settled accounts with them. And he who had received the five talents came forward, bringing five talents more, saying, ‘Master, you delivered to me five talents; here I have made five talents more.’ His master said to him, ‘Well done, good and faithful servant.”[2]
Again, there is calling to take what we have been given and not bury it in the sand, but generate a good return or producing growth.
In a modern day context, Michael Treacy in his book Double Digit Growth puts the issue of growth this way, “Companies decay when they stop growing”.
I also shared with this group that there are some very practical reasons why growth is important. I highlighted some of these in my post Characteristics of Growing and Declining Associations.
When we look at marketing instead of growth issues, everyone can site poor, unethical, or ugly marketing examples. But these examples do not define marketing. Marketing is actually a tool – like a hammer. A hammer can be used to build a beautiful home or it can be used as a weapon. So the tool of marketing should not be judged by how one person or organization uses it.
Here is my operative definition of marketing: Marketing is the discipline of establishing a product and communicating it using the best message, to the best market segments, with the best marketing channels and techniques to maximize the return on investment.
Putting the best product in the best person’s hands in the best way should make sense for any organization.
Well that is my short defense of growth and marketing. Feel free to point out other perspectives.
What to do about Declining Association Membership?
As I mentioned in my post, You Gotta Have Growth!, I just had the opportunity to do a seminar for a network of small non-profits at their annual meeting.
Based on the background I had received, I knew before I came to the meeting that many in this groups were struggling. The network was made up of committed and passionate leaders of organizations, but most were facing hard times.
But I really did not need the background. I seem to meet with non-profits and associations that are facing no growth or decline regularly. Lack of growth seems to be a virus that has infected the non-profit sector.
Tom Hood provided some compelling statistics that highlight this trend in his chapter in ASAE and The Center’s book, Membership Essentials.
“According to the U.S. Census Bureau, the average annual growth rate for associations was 3.8 percent – barely above the 3.2 percent real growth in the U.S. Gross Domestic Product (GDP) for the 10-year period between 1992 and 2002.”
He also noted that “The U.S. Chamber of Commerce’s Survey on the Future of the Completive Association found that 62 percent of associations actually performed below the average GDP rate, with a total growth rate below 20 percent for the same 10-year period. Yet the for-profit commercial sector grew by more than 52 percent during the same time frame.”
Tom concluded by saying, “While a few fast-growing nonprofit organizations are exceptions to this rule, most are struggling to maintain flat or slightly declining memberships.”[1]
In fact just this week, I read an ASAE post by Mike Van Alstine the Growth Coordinator for The National Exchange Club (NEC). He shared, “For the past 20 years the NEC has been on a consistent downward trend in membership of significant size, on average 1,000 members a year. So, if you follow that back to 1987, our membership was a little over 48K.” NEC membership now stands at 26,000 members.
Fortunately, for NEC, Mike reported that he had arrested this decline in membership (more on what he did later). But I have no doubt that it was a painful ride down to that point.
So what did I share with this network of discouraged non-profit leaders. I spoke on the topic of “Marketing Principles to Grow Your Non-Profit” and covered four topics.
1. Are marketing and growth bad?
2. Why do I need to grow my non-profit?
3. What is preventing my non-profit from growing?
4. How then do I grow my non-profit?
In the next couple of posts, I will go over what I shared and some of the feedback that I received.
Based on the background I had received, I knew before I came to the meeting that many in this groups were struggling. The network was made up of committed and passionate leaders of organizations, but most were facing hard times.
But I really did not need the background. I seem to meet with non-profits and associations that are facing no growth or decline regularly. Lack of growth seems to be a virus that has infected the non-profit sector.
Tom Hood provided some compelling statistics that highlight this trend in his chapter in ASAE and The Center’s book, Membership Essentials.
“According to the U.S. Census Bureau, the average annual growth rate for associations was 3.8 percent – barely above the 3.2 percent real growth in the U.S. Gross Domestic Product (GDP) for the 10-year period between 1992 and 2002.”
He also noted that “The U.S. Chamber of Commerce’s Survey on the Future of the Completive Association found that 62 percent of associations actually performed below the average GDP rate, with a total growth rate below 20 percent for the same 10-year period. Yet the for-profit commercial sector grew by more than 52 percent during the same time frame.”
Tom concluded by saying, “While a few fast-growing nonprofit organizations are exceptions to this rule, most are struggling to maintain flat or slightly declining memberships.”[1]
In fact just this week, I read an ASAE post by Mike Van Alstine the Growth Coordinator for The National Exchange Club (NEC). He shared, “For the past 20 years the NEC has been on a consistent downward trend in membership of significant size, on average 1,000 members a year. So, if you follow that back to 1987, our membership was a little over 48K.” NEC membership now stands at 26,000 members.
Fortunately, for NEC, Mike reported that he had arrested this decline in membership (more on what he did later). But I have no doubt that it was a painful ride down to that point.
So what did I share with this network of discouraged non-profit leaders. I spoke on the topic of “Marketing Principles to Grow Your Non-Profit” and covered four topics.
1. Are marketing and growth bad?
2. Why do I need to grow my non-profit?
3. What is preventing my non-profit from growing?
4. How then do I grow my non-profit?
In the next couple of posts, I will go over what I shared and some of the feedback that I received.
[1] Membership Essentials, ASAE and The Center for Association Leadership, 2008, page 121.
My Top Five Trends Impacting Associations of the Future
As part of the ASAE and the Center’s team participating in the Association of the Future program, I reviewed 62 trends and picked those that I felt were most likely to impact associations going forward.
Several of you have shared your feedback on the trends that you think are most significant as comments from my original post. Here are the trends that I picked from the 62.
1. Generation Next: digital, civic, and connected (Trend #1). This generation is the leading edge of the Millennial Generation starting in 1980. I picked this as an important trend not for empirical reasons, but for experiential reasons. This trend describes my kids and their friends. The trend highlights that this generation volunteers and wants to vote, has stronger ties with parents, and connects to friends through the web. I see these characteristics everyday. My son could not wait vote for the first time as a 17 year old in the Virginia Presidential primary. My daughter has friends in Poland, Singapore, and Canada through social media. These kids have a vision to change the world and they will self organize to do it if we do not engage them in our existing structures.
Several of you have shared your feedback on the trends that you think are most significant as comments from my original post. Here are the trends that I picked from the 62.
1. Generation Next: digital, civic, and connected (Trend #1). This generation is the leading edge of the Millennial Generation starting in 1980. I picked this as an important trend not for empirical reasons, but for experiential reasons. This trend describes my kids and their friends. The trend highlights that this generation volunteers and wants to vote, has stronger ties with parents, and connects to friends through the web. I see these characteristics everyday. My son could not wait vote for the first time as a 17 year old in the Virginia Presidential primary. My daughter has friends in Poland, Singapore, and Canada through social media. These kids have a vision to change the world and they will self organize to do it if we do not engage them in our existing structures.
2. Social Networks become mainstream channel for marketing, communication, and engagement (#21). So much has been written and said about social media that I fear the hype may overstate the reality. Nevertheless, when I can sit down and using ning.com and create a new association or community in less than an hour, it is time to take notice. A major new wave is coming on shore and will impact associations in a way equal to the web. I will, however, put in a plug for the benefits of real face to face meetings and conferences. As I write this, I am flying back from a client conference where the networking was vital, the speakers were inspiring, and the information useful.
3. Rising US personal and federal indebtedness (#33). No one can say for sure whether or not the current economic challenges will be severe or mild. But I think it is safe to say that the vulnerability of some of our financial underpinnings has been exposed. In his book, The Zone of Insolvency, Ron Mattocks says “that as many as one-third of the nation’s 1.4 million nonprofits are operating at a level of financial distress, -which will force many to file for dissolution.” How will they be able to handle and even survive a major economic slowdown?
4. Increasing prevalence of ‘Freemium’ and other new business models (#44). I am looking at this concept with a couple of clients. Is there a way to engage a much larger share of the marketplace with something other than a paid membership? Don’t get me wrong, I think people will pay for value. But there may be a way to bring people into relationship with an organization on a non-financial basis first before asking for money. Here is an example, in one email campaign that we tested two possible entry points into the organization for a client; a hard “buy now” membership offer ran head to head against a “free” newsletter subscription offer. The free newsletter did 50 times better. Now the challenge to prove this model will be to see if we can convert these free subscribers to paid members or customers. As I have commented before, joining as a member is a process as much as it is an event.
5. Diminishing US influence internationally (#58). Clearly one of the pillars supporting associations based in the US is the perception that information, regulation, standards, knowledge, and resources in many fields flow from US universities, government entities, companies, and professionals. Diminishing influence could crack some of these pillars, but also open up ideas and involvement from many other parts of the world. Being a global association will be more than a desire, it will be a necessity.
Do you agree with me on any of these trends and the impact they may have? Please feel free to comment and add to these thoughts.
You Gotta Have Growth!
Last week, I had the privilege of speaking to a group of small non-profits on the topic of Marketing Principles to Grow Your Organization. Growth is a real challenge for these groups.
"Managing your size is not the solution to competitive pressure. Growth is. It is the magic elixir that cures almost every business ill. No other kind of 'fix' delivers its transformative power" (Jack and Suzy Welch, When Growth is the Only Solution).
Is this wishful thinking in today's economy or do you agree with this?
62 Trends that Impact the Future of Associations
Over the past few weeks, I have enjoyed participating in the ASAE & The Center for Association Leadership program called Association of the Future.
The process started with evaluating 149 trends and issues that could have a significant impact on the association community. Through a ranking process that we did, these trends were narrowed down to 62. Yesterday, I joined a team of association executives and consultants to explore the potential implications for associations from these trends.
I just asked for and received permission to share a copy of these 62 trends here on the blog. It is an extensive document, but thought provoking and well worth your time.
Let me know what you think are the five biggest trends that will impact associations. I will share the five trends that I think could have the biggest impact on the future for associations in an upcoming post. In the meantime, use this link to access the document.
The process started with evaluating 149 trends and issues that could have a significant impact on the association community. Through a ranking process that we did, these trends were narrowed down to 62. Yesterday, I joined a team of association executives and consultants to explore the potential implications for associations from these trends.
I just asked for and received permission to share a copy of these 62 trends here on the blog. It is an extensive document, but thought provoking and well worth your time.
Let me know what you think are the five biggest trends that will impact associations. I will share the five trends that I think could have the biggest impact on the future for associations in an upcoming post. In the meantime, use this link to access the document.
Some Thoughts on an Excellent Post from Association Inc.
One of the blogs that I link to on Membership Marketing as a “Blog of Value” is Association Inc. The last post entitled “Random Thoughts on New Rules for Association Growth”, is well worth reading. The post speaks to market focus, ownership, dues revenue, data and testing. You’ll find some great ideas to keep the sun from setting on your ship.
Association Inc reminds us to focus on our market not a product. Success comes when we know our marketplace inside out. This intimate knowledge allows us to anticipate needs and create products that meet those needs.
Ownership of whatever product we create for our members is also critical. “Grants, sponsorships, “affinity programs” – these all have a role to play, but in and of themselves will not lead to sustainable, exponential growth because they depend on the whims of others.”[1]
As I have commented on this blog in Exploring Alternative Membership Models, the actual concept of membership has been appropriated by many for profit companies. Many of these companies provide membership for free or at a low dues price, which allows the member to take advantage of discounts and special services.
An example that you may be aware of is Sermo ™ – a free membership site with 60,000 physicians and growing,
Because of this, diversification of income streams is wise. As an ancient proverb reads: “Give a portion to seven, or even to eight, for you know not what disaster may happen on earth.”[2]
Using data effectively is another key point. I have used the quote before from the renowned marketing professor Philip Kotler, he says, “Successful companies [or associations] are learning companies. They collect feedback from the marketplace, audit and evaluate results, and take corrections designed to improve their performance. Good marketing works by constantly monitoring its position in relation to its destination.”[3]
Finally, Association Inc. recommends rapid prototyping and testing of new initiatives. This culture of innovation is foundational for success. “Most companies [or non-profits] would be better off if they made fewer billion-dollar bets and a whole lot more $10,000 or $20,000 bets – some of which will, in time, justify more substantial commitments. They should steer clear of grand, imperial strategies and devote themselves instead to launching a swarm of low-risk experiments.”[4]
Are there any other insights that you would add to these?
[1] Association Inc.
[2] Ecclesiastes 11:2
[3] Kotler on Marketing, Free Press, 1999
[4] Gary Hamel and Lisa Valikangas, “The Quest for Resilience”, Harvard Business Review
Association Inc reminds us to focus on our market not a product. Success comes when we know our marketplace inside out. This intimate knowledge allows us to anticipate needs and create products that meet those needs.
Ownership of whatever product we create for our members is also critical. “Grants, sponsorships, “affinity programs” – these all have a role to play, but in and of themselves will not lead to sustainable, exponential growth because they depend on the whims of others.”[1]
As I have commented on this blog in Exploring Alternative Membership Models, the actual concept of membership has been appropriated by many for profit companies. Many of these companies provide membership for free or at a low dues price, which allows the member to take advantage of discounts and special services.
An example that you may be aware of is Sermo ™ – a free membership site with 60,000 physicians and growing,
Because of this, diversification of income streams is wise. As an ancient proverb reads: “Give a portion to seven, or even to eight, for you know not what disaster may happen on earth.”[2]
Using data effectively is another key point. I have used the quote before from the renowned marketing professor Philip Kotler, he says, “Successful companies [or associations] are learning companies. They collect feedback from the marketplace, audit and evaluate results, and take corrections designed to improve their performance. Good marketing works by constantly monitoring its position in relation to its destination.”[3]
Finally, Association Inc. recommends rapid prototyping and testing of new initiatives. This culture of innovation is foundational for success. “Most companies [or non-profits] would be better off if they made fewer billion-dollar bets and a whole lot more $10,000 or $20,000 bets – some of which will, in time, justify more substantial commitments. They should steer clear of grand, imperial strategies and devote themselves instead to launching a swarm of low-risk experiments.”[4]
Are there any other insights that you would add to these?
[1] Association Inc.
[2] Ecclesiastes 11:2
[3] Kotler on Marketing, Free Press, 1999
[4] Gary Hamel and Lisa Valikangas, “The Quest for Resilience”, Harvard Business Review
Are Radio and TV in Your Membership Development Future?
In the Five Phases of the Membership Life Cycle, I highlighted how awareness is the first step in the membership relationship. If a prospective member is not aware of whom you are and what value your organization brings, then you are a long way off from closing a sale.
Making a sale involves a series of little steps moving a prospect from A to Z.
That’s why as a membership marketer, I have enjoyed watching the use of radio and television to build awareness and membership by two groups, the American Association of Family Physicians (AAFP) to the Society for Human Resource Management (SHRM).
Here is the publicly available information on these programs that I have come across on the web.
AAFP has launched a major awareness program with sponsorship of my favorite radio program Marketplace on NPR and with 30 to 60 second ads on 71 XM Radio stations. SHRM has also been a sponsor of the regular feature on Marketplace. They sponsor the segment with interviews of top corporate CEO’s in a feature called Conversations from the Corner Office.
In addition, according to Digital News Direct, SHRM has run TV ads during CNN Election Coverage and FOX Business Jumpstart. If you watched the candidate debates you may have seen the ad. Here is a link to the ad.
Both of these groups are well respected organizations and it appears that their awareness advertising has been well thought out and done in a responsible and effective manner.
But as you read this you may ask are radio and TV something that all association marketers should jump on board and do? Will it help your association blossom?
From my perspective the answer is before these channels are considered, you need to have your bases covered with more traditional association marketing techniques. True with the increasingly defined market segmentation that HD and satellite radio and cable TV provide, it is now becoming a possibility to at least explore these mediums. But rarely do consumer demographics match up with the qualifiers that would make someone eligible for membership. You may have 50 year old woman as members, but they also need to be in your profession in order to be interested in membership.
Here is another major caution that I have to using broadcast or consumer advertising channels. There is a very big potential to spend a lot of money in a very inefficient manner. You need to ask the question, what proportion of those who see these ads are potential members or people that you want to influence and to compare this to the effectiveness of a tightly targeted promotion.
Some associations and non-profits are not effectively picking the low hanging fruit for new members already, so this should be the first use of resources before investments are made in the consumer realm.
What are your thoughts on the use of broadcast and consumer media to build awareness about your organization and get more members?
Making a sale involves a series of little steps moving a prospect from A to Z.
That’s why as a membership marketer, I have enjoyed watching the use of radio and television to build awareness and membership by two groups, the American Association of Family Physicians (AAFP) to the Society for Human Resource Management (SHRM).
Here is the publicly available information on these programs that I have come across on the web.
AAFP has launched a major awareness program with sponsorship of my favorite radio program Marketplace on NPR and with 30 to 60 second ads on 71 XM Radio stations. SHRM has also been a sponsor of the regular feature on Marketplace. They sponsor the segment with interviews of top corporate CEO’s in a feature called Conversations from the Corner Office.
In addition, according to Digital News Direct, SHRM has run TV ads during CNN Election Coverage and FOX Business Jumpstart. If you watched the candidate debates you may have seen the ad. Here is a link to the ad.
Both of these groups are well respected organizations and it appears that their awareness advertising has been well thought out and done in a responsible and effective manner.
But as you read this you may ask are radio and TV something that all association marketers should jump on board and do? Will it help your association blossom?
From my perspective the answer is before these channels are considered, you need to have your bases covered with more traditional association marketing techniques. True with the increasingly defined market segmentation that HD and satellite radio and cable TV provide, it is now becoming a possibility to at least explore these mediums. But rarely do consumer demographics match up with the qualifiers that would make someone eligible for membership. You may have 50 year old woman as members, but they also need to be in your profession in order to be interested in membership.
Here is another major caution that I have to using broadcast or consumer advertising channels. There is a very big potential to spend a lot of money in a very inefficient manner. You need to ask the question, what proportion of those who see these ads are potential members or people that you want to influence and to compare this to the effectiveness of a tightly targeted promotion.
Some associations and non-profits are not effectively picking the low hanging fruit for new members already, so this should be the first use of resources before investments are made in the consumer realm.
What are your thoughts on the use of broadcast and consumer media to build awareness about your organization and get more members?
Watch the Alligators: Association Marketing Legal Reminders
It is very easy for me to forget that good marketing includes a sound understanding of legal issues in addition to strategy, creative, and analysis.
Here are some of the legal items to keep in mind when developing marketing campaigns.
UBIT: In the April Associations Now piece titled “Lessons from new CAE’s”, Mary Moon Allison, CAE, from the American Nurses Credentialing Center shared that she learned when marketing her affinity programs (like list rentals, credit cards, etc.) that “If we do not actively market it, the income is considered passive and is not subject to UBIT, but if we’re involved in the marketing of it, the IRS considers it unrelated business income (p. 16).” This is why associations that hope to earn substantial revenue from these programs use outside providers to manage the program.
Nonmember Pricing: In the same Associations Now piece, Lakisha Campbell, CAE, National Association of Home Builders noted that “the difference in member to nonmember product or program pricing could not be greater than the price of membership (p.16).”
Invoices or Renewals: Some associations make a common mistake is incorrectly using the term “Invoice” on membership renewal notices. Remember, a member does not have a legal obligation to pay a renewal notice. Therefore, it is not an invoice. Using an invoice is appropriate if a member has requested to be billed through some type of bill-me solicitation.
FAX Solicitations: Fax marketing is also an area where there can be some confusion and liability. The Direct Marketing Association provides a good alert on rules governing the use of faxes in marketing. “The Junk Fax Prevention Act of 2005 allows marketers to send commercial faxes to those with whom they have an established business relationship (EBR), but imposes some new requirements. These requirements include providing an opt-out notice on the first page of faxes and establishing a system to accept opt-outs at any time of the day.” I just met with a group that was unknowingly in violation of these rules. Violations can get very expensive.
Email and SPAM: Fortunately, I do find that most associations are very aware of the laws governing email solicitations and follow the four major provisions of the act including: false or misleading information, deceptive subject lines, opt outs, and physical mailing address.
It is good to keep these in mind because violations can be expensive. The Federal Trade Commission FTC says that “Each violation of the [can spam] provisions is subject to fines of up to $11,000. Deceptive commercial email also is subject to laws banning false or misleading advertising.”
Telemarketing: Another area of legal concern in marketing is telemarketing and the Do Not Call Registry. If you are a non-profit, you are not impacted by the do not call rules. According to the Federal Communications Commission (FCC), The Do Not Call Registry “does not cover the following: calls from organizations with which you have established a business relationship; calls for which you have given prior written permission; calls which are not commercial or do not include unsolicited advertisements; calls by or on behalf of tax-exempt non-profit organizations.”
Direct Mail: Finally, there is also a non-legal, but strongly recommend ethical practice that you should consider with your direct mail marketing. It is to suppress prospective members and customers from your mailings using the DMA Mail Preference Service (Do Not Mail File). This is a file of people who have asked not to receive direct mail solicitations.
Am I missing any other legal issues here that you can think of mentioning? Feel free to let me know.
Here are some of the legal items to keep in mind when developing marketing campaigns.
UBIT: In the April Associations Now piece titled “Lessons from new CAE’s”, Mary Moon Allison, CAE, from the American Nurses Credentialing Center shared that she learned when marketing her affinity programs (like list rentals, credit cards, etc.) that “If we do not actively market it, the income is considered passive and is not subject to UBIT, but if we’re involved in the marketing of it, the IRS considers it unrelated business income (p. 16).” This is why associations that hope to earn substantial revenue from these programs use outside providers to manage the program.
Nonmember Pricing: In the same Associations Now piece, Lakisha Campbell, CAE, National Association of Home Builders noted that “the difference in member to nonmember product or program pricing could not be greater than the price of membership (p.16).”
Invoices or Renewals: Some associations make a common mistake is incorrectly using the term “Invoice” on membership renewal notices. Remember, a member does not have a legal obligation to pay a renewal notice. Therefore, it is not an invoice. Using an invoice is appropriate if a member has requested to be billed through some type of bill-me solicitation.
FAX Solicitations: Fax marketing is also an area where there can be some confusion and liability. The Direct Marketing Association provides a good alert on rules governing the use of faxes in marketing. “The Junk Fax Prevention Act of 2005 allows marketers to send commercial faxes to those with whom they have an established business relationship (EBR), but imposes some new requirements. These requirements include providing an opt-out notice on the first page of faxes and establishing a system to accept opt-outs at any time of the day.” I just met with a group that was unknowingly in violation of these rules. Violations can get very expensive.
Email and SPAM: Fortunately, I do find that most associations are very aware of the laws governing email solicitations and follow the four major provisions of the act including: false or misleading information, deceptive subject lines, opt outs, and physical mailing address.
It is good to keep these in mind because violations can be expensive. The Federal Trade Commission FTC says that “Each violation of the [can spam] provisions is subject to fines of up to $11,000. Deceptive commercial email also is subject to laws banning false or misleading advertising.”
Telemarketing: Another area of legal concern in marketing is telemarketing and the Do Not Call Registry. If you are a non-profit, you are not impacted by the do not call rules. According to the Federal Communications Commission (FCC), The Do Not Call Registry “does not cover the following: calls from organizations with which you have established a business relationship; calls for which you have given prior written permission; calls which are not commercial or do not include unsolicited advertisements; calls by or on behalf of tax-exempt non-profit organizations.”
Direct Mail: Finally, there is also a non-legal, but strongly recommend ethical practice that you should consider with your direct mail marketing. It is to suppress prospective members and customers from your mailings using the DMA Mail Preference Service (Do Not Mail File). This is a file of people who have asked not to receive direct mail solicitations.
Am I missing any other legal issues here that you can think of mentioning? Feel free to let me know.
New Blog on Financial Risks and Solutions for Non-Profits
A long time association professional, Ron Mattocks, has just launched a blog to accompany his new book, the Zone Of Insolvency: How Nonprofits Avoid Hidden Liabilities and Build Financial Strength.
The book just came out today, so I have not read it yet. However, here is how Ron describes the issues he is addressing.
“The term ‘Zone of Insolvency’ was first used by the courts in 1992. It describes a period of financial distress where insolvency is at least a foreseeable possibility by reasonable business people. The court said that a board governing a corporation in the Zone of Insolvency has expanded legal responsibilities and liabilities. I chose to focus on nonprofit corporations in the Zone of Insolvency because a greater percentage of nonprofits operate in perpetual financial distress than what we see on the for-profit side. New nonprofits have incorporated at twice the rate of for-profits every year for the past twenty years. But on the back end, fewer nonprofits file for dissolution. As a result, we have this escalating glut of nonprofit organization living perpetually in the Zone of Insolvency.”
The book just came out today, so I have not read it yet. However, here is how Ron describes the issues he is addressing.
“The term ‘Zone of Insolvency’ was first used by the courts in 1992. It describes a period of financial distress where insolvency is at least a foreseeable possibility by reasonable business people. The court said that a board governing a corporation in the Zone of Insolvency has expanded legal responsibilities and liabilities. I chose to focus on nonprofit corporations in the Zone of Insolvency because a greater percentage of nonprofits operate in perpetual financial distress than what we see on the for-profit side. New nonprofits have incorporated at twice the rate of for-profits every year for the past twenty years. But on the back end, fewer nonprofits file for dissolution. As a result, we have this escalating glut of nonprofit organization living perpetually in the Zone of Insolvency.”
His blog covers items ranging from financially stressed organizations to the liabilities of board members to non-profits and theft. As we seem to be facing increased turbulence in the economy, this may be something you want to learn more about related to your organization.
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