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Questions Boards Should Ask About Non-Dues Revenue
Due to a variety of factors, generating revenue has become job one for many associations. According to the 2017 McKinley Advisors “Economic Impact on Associations” report, non-dues revenue was the top priority among associations. This is a landmark shift. For the first time in the 10-year history of the study, membership is not the number one area of focus for associations, said McKinley. Specifically, 26 percent of respondents said non-dues revenue was one of their top three priorities—while 24 percent said new member acquisition, 23 percent said improving member retention, and 23 percent said developing new methods of member engagement.

Also, when asked to rate their level of worry among six specific issues, approximately two-thirds (67 percent) called obtaining sponsorships a concern —up 21 percentage points from the previous year’s survey. Only competition (73 percent), which jumped 31 percent from the last survey, saw a higher annual increase.

While developing non-dues revenue opportunities is a function of staff, boards should guide staff to ensure that any non-dues revenue opportunities are impactful and make sense for the organization. We spoke to Tom Myers, Vice President, Sales Services at SmithBucklin, who provided some questions that boards should ask their staff about non-dues revenue programs.

Is Our Value Aligned? It’s critical that the opportunities are, first and foremost, of value to members. Whether it’s through surveys or other forms of outreach, your association’s staff team should use data to let your membership point you in the right direction on the design and implementation of new revenue-generating opportunities, said Myers. This will also help drive member engagement with industry partners.

Does it Further Our Mission? In addition to being of value to members, any new programs should advance the mission of the association. For example, there may be a temptation to pursue non-traditional sources for sponsorships — say mobile phone providers, because those companies have deep pockets, and everyone has cell phones. However, these partners may be better leveraged for some type of affinity program that provides discounts to members, Myers said.

Do We Have the Resources? The board should make sure that the association chief staff executive is empowered to get the resources he or she needs to make the program successful and support its revenue goals, Myers explained.

How Do We Measure it? The board should ensure that staff has the proper metrics in place to measure the success of programs. Further, programs should be reviewed annually. Are they meeting their financial goals? Are they valued by membership and industry partners? Are they advancing the association’s mission? If they fall short in any area, the board should be prepared to either authorize the necessary changes, or discontinue them, said Myers. In addition, the board should have a plan of how to allocate or invest the additional revenue should initiatives prove successful.

Finally, Myers cautions boards to be realistic in their expectations. Factors such as industry partner consolidation, competition, and membership trends can dramatically affect the revenue outcome of your initiative year-over-year.
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JANUARY 2018 EDITION
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Board Forward is published 10 times a year by SmithBucklin, the association management and services company more organizations turn to than any other. SmithBucklin has served volunteer board members for more than 60 years.

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