Five reasons why membership is killing association business models: Part I

by Jeff De Cagna on July 17, 2012

Membership is perhaps the most sacred tenet in all of association orthodoxy. Indeed, for many organizations, the membership imperative defines the very existence of the association: membership is who they are and what they do. In a time of relentless societal transformation, however, the impact of forces beyond our control makes it necessary for us to question all of our most deep-seated beliefs, including our beliefs about membership. In this three-part series, I will share five critical reasons why the continued emphasis on membership is “killing” association business models. Please share your ideas and insights in the comments below.

Reason #1: Membership-centric business models organize all value around the membership relationship.

The typical association business model depends on member relationships that are becoming harder to maintain given today’s sky-high stakeholder expectations for value. Even when dues payments are not a major revenue stream, the membership mindset still shapes the internal logic of the typical association business model. As a result, most associations tend to offer only “pay-to-play” membership relationships, even though current and future stakeholders often have free or low-cost access to a variety of “good enough” and superior alternatives for building networks, retrieving information and pursuing learning.

NEW DESIGN APPROACH: 21st century association business models must focus on creating radical new value instead of on membership. By prioritizing value creation and placing less emphasis on membership, associations will have the opportunity to establish open and, hopefully, collaborative relationships with stakeholders for whom membership is not an option. Instead of a one-size-fits-all membership value proposition, associations will be able to enter into rich and mutually-beneficial value conversations with these stakeholders, and gain better access to (and perhaps greater influence with) their distributed networks.

Reason #2:  Membership-centric business models tend to focus on association outputs instead of stakeholder outcomes.

Today’s stakeholders live in a complex, competitive and dynamic world that demands they be very focused on achieving their most important personal and professional outcomes. To create new value for these stakeholders, associations need a more intimate and empathic understanding of both their intentions, and the constraints they face. The typical membership-centric business model, however, still produces a defined bundle of standardized outputs that is delivered to all stakeholders, through the association’s preferred channels, on “association time,” as determined by internal operating, planning and governing calendars.

NEW DESIGN APPROACH: In designing 21st century business models, association leaders must pay much closer attention to the kind of people their current and future stakeholders wish to become, and the things they wish to achieve in their lives. Far beyond solving immediate problems or servicing short-term needs, association business models must be designed to provide meaningful support to their stakeholders as they pursue their deepest aspirations, on their terms and on their time. Going forward, stakeholder intimacy and empathy, not industry or professional tradition and orthodoxy, must guide the work of business model innovation.

Part II with reasons #3 and #4 will be published next week. In the meantime, sign up today for P.I.’s new Serious Questions electronic newsletter!

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  • Claudia Zacharias

    Great topic, Jeff. I look forward to reading the rest of the
    series. If you have any thoughts on the relative desirability of chapter-centric
    vs. nationally-organized membership, I’d be interested in them.

  • Zell Murphy

    How do we embrace this new “personalized” design approach without jeopardizing the industry based focus that allows us to maintain our not-for-profit status?  In other words, once we begin to implement or tailor programs to benefits individual member companies, do we suddently become sore of a “for profiit” business consultant? 

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  • http://www.lalassociationmemberservices.ca/ Wendy

    Great article but the issue is that leading associations to understand and change their business model is the challenge.  In my business I incur client member survey that reflect the association’s needs and not the stakeholders.  So the challenge is on to change that environment

  • Kathleen

    For all the rhetoric, I’m not getting any concrete, “how-to” approaches to achieving all these superlatives!

  • Chrisj

    I agree with Kathleen. I would like some concrete examples of how you go about doing this. The organization still needs to bring in revenue and our members are primarily individuals.

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  • http://www.conferencesthatwork.com/ Adrian Segar

    I have been president of a small association for 21 years. Eleven years ago we eliminated the whole concept of “membership”. We realized that tracking who our “members” were and collecting dues were distracting us from our core mission of creating and supporting a community of those who shared the association’s purpose. Our revenue comes solely from the events we organize and the organization is healthy, responsive, and event attendance is growing.

    We made a good decision.

    • Klivingston

      Tell me more!  What is your focus/mandate?  What is the purpose of your association?  Are you now strictly an events organizing association? How do you decide what your focus is without responding to members’ priorities? I have many, many questions…..

      • http://www.conferencesthatwork.com/ Adrian Segar

        edACCESS is an 501(c)(6) association of IT staff at small schools. Most of our conference participants hail from the U.S. but we sometimes get a few from abroad. Our primary activity is our annual 3½ day conference, which uses the Conferences That Work participant-driven format I’ve developed (and written a book about). The annual conference process effectively uncovers member issues and may lead us to hold further focused events during the year. A listserv (remember them?) and private wiki provide places for people to access resources, ask questions and get support at any time.

        I wouldn’t say we are event-driven; more that we use our events as a way to discover relevant issues and provide peer sharing and support for them. In other words, our events are a mutually beneficial tool that are budgeted to cover our administrative needs.

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  • Moragmc

    We are in the processes of reviewing our value proposition for members, so this is a timely discussion. I too would like more information on how we achieve this intimacy.

  • Charles

    Agree with Kathleen. The content above raises interesting questions, and suggests a new line of thinking. These are vaild. However, Jeff misses an effective “how-to” message – almost entirely. Adrian – thanks for your insights, these were very useful to understand as a practitioner running a real association using one of the above mentioned paradigms.

    Jeff – please make a stronger case by adding in real-world examples of how an organisation achieved what you are stating. Otherwise the arguments and article become entirely hypothetical – and not particularly useful to someone running an association (which I do).

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