The current pandemic has made associations revisit their membership models. With declining revenue streams due to event cancellation, inability of members to pay membership dues because of layoffs, and difficulty finding sponsors and donors, associations struggle to do “business as usual.”
A membership model is a business plan an association adopts to map out the design for different membership levels, products and services, marketing activities, and revenue sources. Membership models abound and can be classified into two contrasting categories: the traditional (service provider) membership and the community (platform).
In “Reshaping Associations: The Impact of the Pandemic on Membership Models,” a webinar that the Philippine Council of Associations and Association Executives (Pcaae) organized, Belinda Moore, director at Australian-based Strategic Membership Solutions, talked about these two models:
Role: In the traditional model, the association is a provider of services to its members and focuses on recruiting, engaging and retaining members. In the community model, the association fosters a community of both paid and free participants and its focus is on nurturing a strong and engaged community.
Content: The association tends to create and distribute most content in the traditional model. In the community model, both free and paid community participants create and distribute the majority of content. Any association content is around community facilitation and core activities.
Services: In the traditional model, the association wants to own and control the majority or all its products and services. In the community model, the association may retain core activities but also fosters a vibrant marketplace where competing quality suppliers are welcomed (noting that their entitlements likely differ from other participants).
Non-members: In the traditional model, the association sees non-members as a “lesser” participant, charge them higher fees, and have limited engagement. They are, however, welcome participants and can opt to pay for upgrades and additional benefits in the community model.
Managing groups: In the traditional model, there are a few role duplications and this discourages the formation of groups the association is unable to manage. In contrast, the community model has many groups and lots of role duplications, which encourages groups to self-organize.
Fees: Annual membership dues are paid in full or in instalments in the traditional model. In the community model, members can opt for a free or paid subscription. A free membership is often a pathway to a paid membership.
Revenue: In the traditional model, the association generates income via membership dues, event registrations, sponsorship, and service provision. In the community model, aside from the income from these traditional sources, the association can also leverage new income streams via the platform, e.g., micro-transactions, research, ad targeting.
“Associations must ensure that their membership and revenues models align with their purpose and operating landscape. Many are shifting from traditional models to more contemporary community models,” Moore concludes.
One good thing that the pandemic has provided is the time for associations to rethink their business model. So, is it time to shift your present membership model from traditional to a community model?
The column contributor, Octavio “Bobby” Peralta, is concurrently the secretary-general of the Association of Development Financing Institutions in Asia and the Pacific and the Founder & CEO of the Philippine Council of Associations and Association Executives. PCAAE is holding the Associations Summit 8 on November 25 and 26, 2020 with the theme, “Leading with Agility.” The two-day virtual event is supported by Adfiap, the Tourism Promotions Board and the PICC. E-mail inquiries@adfiap.org for more details on AS8.