Learning to monetize your
relationship with members will actually
help you better serve their needs.
By Jennifer Salopek
There’s a reason that the eternal Holy Grail of associations, non-dues
revenue, drew a standing-room-only crowd to an Association Media &
Publishing Lunch & Learn on the topic in August. Consultant Lou Ann
Sabatier, who laid out the groundwork for lucrative growth strategies, noted
that competition is so fierce, even commercial publications are moving to a
And yet, associations still have a key asset in their content, and if
we develop a new way of thinking—this is not about tactics, but about strategy,
Sabatier explained—we can monetize our relationships with members as we better
serve their needs.
This positioning for growth has six key steps, according to Sabatier:
Protect existing revenue
Assess performance. Before
we design and implement any new strategy, it’s important to see where we are.
Further, it can lead to growth, Sabatier says. Your organization must answer
the question, "Have we optimized our current non-dues revenue-generating
programs and services?” Optimization means serving members to the best of our
ability; enhancing revenues and margins; and enhancing employee and volunteer
morale and motivation. Existing programs are where revenue growth will come
first, says Sabatier, who notes that sometimes there is 10 to 20 percent growth
sitting on the table.
She emphasized that morale and motivation are important pieces. "‘Do
more with less’ is a stupid mantra,” Sabatier says. "Process and discipline are
important to people, whether paid or volunteer. They want to know that the
organization is managing smart and that they are being heard.”
Formulating a clear and articulated growth strategy is the next step.
It comprises vision and strategy, competitive analysis, and value proposition,
then details the available resources and how they will be leveraged. Vision
focuses on how you will serve member needs, while strategy is a concrete
roadmap. The value proposition is key to differentiation in the marketplace,
and can vary for different stakeholders. It lays out how you will curate your
key asset, content.
Innovate. When striving to
innovate, associations often make the mistake of mimicking other groups in the
name of "best practices,” Sabatier says. "Innovation is hard work and requires
risk; it cannot be random, accidental, or ad hoc if it is to be sustainable.”
Leadership and support from the top of the organization are crucial. To
innovate, examine offerings, process, environment, and people.
"It’s not for the faint of heart; everyone must be on board,” she says.
Protect existing revenue. Your
organization also must be sure to protect current revenue streams and programs
that are working. Ask yourself, "Why do we charge the prices we do?” "Believe
that what you’re offering has value, and don’t be afraid to charge,” says
Diversify. To diversify your
offerings, take a 360-degree view of your members and prospects; identify and
develop personas for the various segments of your audience. Although offerings
in the past were grouped into a few dominant revenue streams, now many smaller lines
make up for the decline in the traditional standard-bearers.
Use a disciplined approach to assess opportunities with these three
Is it real? Will somebody actually pay to buy
what we offer? Can our team produce and sell it?
Is it worth it? Is there sufficient revenue to
move the meter? Is there any margin when fully costed? Does selling it provide
an intangible benefit?
Can we win? Can we beat the competition and
still make money?
Partner. Seek partners for
all kinds of activities: business development, shared learning, marketing. Look
for complementary competencies, expanded opportunities, the opportunity to
leverage existing resources, and the opportunity to minimize new costs.
Be accountable. Accountability
is also critical. You must commit to actionable research to measure success and
close the loop. "You must want to know whether you were successful,” Sabatier
says, adding that it’s okay to fail. "It’s painful, but we must take risks to
have forward movement.”
SHRM Case Study
The Society for Human Resource Management (SHRM) has taken many of
these suggestions to heart. In the second part of the program, Tim Canny,
director of publication sales, detailed SHRM’s non-dues revenue strategy and
results in a case study. Some quick statistics:
Annual dues: $180 per person
$105 million in annual revenue
Website draws 600,000 unique visitors per month
Annual conference draws 14,000 attendees and 500
SHRM has made a concerted effort to expand non-dues revenue over the
past two years, Canny says. Even so, traditional print advertising in the
flagship magazine continues to represent the largest segment (one-third) of
advertising revenue. Other vehicles include online advertising, ads in print
and electronic newsletters, list rental (postal mail only), job postings,
conferences, webcast sponsorships, certification, and other offerings.
Canny offered these lessons learned:
strategic. Have a vision and a plan for how to get there.
risk tolerance. Anticipate some failure; learn and build from there.
Put metrics in place beforehand that allow you to assess performance.
invent. When metrics indicate success, refresh and renew those products.
Meanwhile, identify new markets and launch new products in the medium
appropriate to the opportunity.
"While you defend existing positions, you must actively build new
ones,” Canny says.
To wrap up, Sabatier provided some closing comments about digital publishing.
Many organizations are looking to digital publishing as a source of new
revenue, she notes. However, they also tend to wait until they begin that
process to devise the business model. "You need to know where your members are
in the post-paper market and what that means for your organization,” she says.
"You may need to give away stuff that provides access to a monetization
Jennifer J. Salopek is a freelance
writer in McLean, Va. Association Media & Publishing thanks her for covering this event for our
members who were unable to attend. Also, special thanks to the National School
Boards Association for hosting and EEI Communications and AGS for sponsoring.