Is Now the Right Time to Add an Associate Member Category?
Associate member categories can create new partnerships and revenue sources for your association. But timing is everything. Before adding to your membership, ask a few strategic questions about why these members are needed.
If you’re a trade association, there’s a good chance you’ve thought long and hard about adding an associate category to membership. Or, maybe, like many execs said in a recent Collaborate discussion, you already have one [ASAE log-in required].
Frequently, these categories are used by associations to bring in a network of industry-specific service providers. And in the process it can help to grow dues revenue. You can kind of think of associate membership as a toll, says Erik Schonher, a consultant and founder of The Schonher Group.
“The associate member model acts as a toll—or pay-to-play—for those who want access to the market or industry,” he says. “The association is the gatekeeper and collects dues from prospects or buyers for an industry.”
For a lot of associations, an associate member category is probably a good idea, Schonher says, because it brings in a targeted group that’s relevant and useful to its members. But just because something might be a good fit, doesn’t mean you shouldn’t put some serious thought into it.
“It’s sort of like adding on to a tightknit family. It’s a very serious thing to invite someone new into your house,” Schonher says. “On a strategic level, you have to ask: ‘Why are we really doing this?’”
Asking this question and a few others, can help an association determine when and if the timing is right for a new member category.
The Commercial Finance Association has banks and finance companies as members, but gets a significant amount of its revenue from service providers who do not currently qualify as members.
For many years, CFA’s membership categories have remained the same—tiers that are weighted by how many assets a finance company has in secure lending. That can make it difficult to determine which organizations qualify for membership and at what tier, says Tim Atkinson, director of membership, education, and chapter support.
“The first thing that’s been a problem in recent years, is knowing if someone is eligible or ineligible,” he says. “And if someone is eligible, when you look at the strict letter of the bylaws, sometimes the dues aren’t really appropriate for the member.”
Most organizations, Atkinson says, have a “long history of involvement” with CFA whether they are members or not. In any given week, CFA might gain one new member but turn away two ineligible members.
“It’s difficult to say to someone, ‘You can’t join,’” Atkinson says.
Talking to current members is one way to help you determine whether or not a new member category is needed. In the case of CFA, direct member feedback and conversations, both inside and outside the organization, are helping the group to see that possibility.
Who Should Be An Associate Member?
Many associations see dollar signs when they think about creating an associate member category, Schonher says. But the potential for dues revenue is a distraction from other key objectives, such as creating strong member-to-member relationships or growing the industry with the right members in mind.
“This process starts with some clear thinking that should involve your board,” Schonher says. “Because you have to stay true to mission and learn to listen to members if you’re going to stay ahead of the curve.”
He suggests establishing strategic objectives for membership growth. Those could come from a member survey or focus group that identifies friction areas found within the industry or membership experience.
“Those frustrations are typically where a specific type of associate member or service provider might be able to step in and help fill a need,” Schonher says.
How Many and How Much?
Survey research can also help to determine the number of associate members that you let in and the price of membership. Boards may set a predetermined formula or percentage for associate-level members versus core members [ASAE log-in required]. But having an agreed-upon rate and value should be more of a science than art.
“Price can be one of the main barriers to membership growth,” Schonher says. “Associations come at membership pricing from a personal perspective and often overvalue it. To do pricing right, you need to simulate real market conditions and apply a specific method.”
He suggests using methodical survey research when pricing a new product or service. Schonher cites a research paper [PDF] on some of the various models, including which perform best for determining a price point on services, like a new member category.
And even if your associate member category is already in place, Schonher says associations need to take time to evaluate how it’s performing. Too often, this category gets neglected or overlooked. By constantly tweaking the access level and value, associations can create a category that’s best suited to meet members’ needs.
“You need to be asking if the membership category is working,” Schonher says. “Make sure your associate members feel included as true members, and that you’re not just paying lip service.”
What strategies have you found successful when it comes to associate memberships? Post your answer in the comment thread below.