Raising association dues can be a real challenge.

Let’s review the latest innovative trends in non-dues revenue programs…

Person reviewing financialsQuestion: Is your association looking for new and innovative sources of non-dues revenue?

Answer: Duh! Aren’t all associations looking for new sources of non-dues revenue?

While average associations get the biggest chunk of annual revenues from membership dues, reliance on dues driven revenue is waning. Over the past 65 years, the percentage of association revenue from dues has plummeted.  According to ASAE Foundation’s Association Operating Ratio Report (2016) they’ve dropped from 95.7% in 1953 to 45.4% for trade associations and 30% for professional societies.

For many associations, raising dues is an unwelcome idea, a difficult process, and/or both. To continue effectively funding operations while holding dues increases in check, many organizations are increasing focus on driving non-dues revenue.

Non-dues revenue has traditionally fallen into four categories:

  • Royalty/Affinity Programs: These programs are typically products or services that members need in their business or personal lives. They include discounts on office supplies, car rentals, and an array of insurance products like professional liability, health, and automobile. The association usually receives royalties on the money their members spend on these programs. These royalties are given in exchange for promoting the program and licensing their brand assets to the affinity partner.
  • Advertising/Sponsorships: Whether for events, printing, website banner advertising, or selling naming rights to an association’s conference rooms, many organizations rely on advertising and sponsorships for non-dues revenue. This line of business has grown. Associations can now outsource advertising and sponsorship sales to businesses specializing in association sponsorship sales.
  • Education/Events: Most associations rely on profits from events and education to help drive their budget. Years ago, it was more common for association events to just cover their costs. Nowadays, most associations expect their conferences and educational programs to turn a profit and contribute positively to the bottom line.
  • Products/Services: Some associations sell physical goods such as books, manuals, logo-wear, and other swag. Others offer services to members and prospects such as consulting and other professional services.

Broadly speaking, there are two markets for non-dues revenue:

  • Members and prospects: These are people who qualify for membership in the association, and who need products or services that the association provides. Members may gain exclusive access to those products or services, or may pay a lower fee than non-members. They pay attention to products, services, events, and education that helps them do their jobs better, earn more, and make their lives easier. When your association provides solutions that address these needs, you’ll enhance your ability to increase non-dues revenue.
  • Sponsors and advertisers: These are companies that want to sell things to your members and prospects. They understand that your association is the advocate and representative body for the industry or profession. By supporting your organization, they earn awareness and respect in the market. Sponsors and advertisers are always looking for new ways to stand out from the competition. When associations offer unexpected/unique ways to help companies drive sales, the capacity to earn more non-dues revenue increases.

Here are some new and innovative non-dues revenue programs that empower you to provide all new value to the markets in your profession or industry:

  • Sponsored content: Some associations allow advertisers to author content and place it in their newsletters, blogs, and social media posts. A best practice is to clearly mark such articles as Sponsored Content. We’ve also seen associations sell advertisers presentation rights on webinars, or the privilege of speaking in conference breakout sessions. This article from ASAE has some excellent advice on how to set up your sponsors to put their best foot forward as thought leaders within your association.
  • Retargeting for sale: You know when you look at an item on Amazon and suddenly you start seeing ads for that item everywhere on the web? Kind of like it’s stalking you? That’s called retargeting. We’re aware of some associations that re-sell retargeting to their advertisers. So after you visit the association’s website, you’ll start to see ads for the association’s advertisers stalking you. This tactic is especially effective for associations whose members are averse to advertising. This is because the advertising doesn’t appear on the association’s websites. Rather, the ads appear on popular sites such as LinkedIn, Weather Channel, and CNN.
  • Discount apps: In the past year we’ve learned about apps that allow members to score discounts on hotel rooms. These are similar to HotelTonight or Priceline, but at a deeper discount. We’ve also seen apps that enable members to buy gift cards at 10-20% off at major retailers and restaurants. Such apps effectively give them discounts on everyday purchases. They even offer cash back after a certain dollar amount has been spent on gift cards. These operate as affinity programs. ShoppingBoss and Booking Community are two examples of discount apps for association members.
  • Curated newsletters: These aren’t all that new, but we’re seeing more and more players entering the market. Basically, your association hires a company that will curate content for a highly targeted newsletter for your organization. The company then sends it to your members, and sells advertising around the content. These are typically royalty/revenue-sharing agreements. Your association receives a percentage of whatever advertising gets sold. SmartBrief and InLoop are two examples of companies that offer curated newsletter services.
  • Job boards: Not exactly new, but deserving mention, are job boards. We’re aware of some associations that earn over $1M annually on proprietary job boards. There are several platforms that allow your association to create its own job board. These include platforms such as Web Scribble, Boxwood, and JobTarget. Some job board providers even employ outbound sales teams to sell job ads on your site, accelerating your ability to earn non-dues revenue.
  • Online review sites: Okay, shameless plug here… Online review sites, such as those powered by 100Reviews, are potential gold mines of non-dues revenue. Members don’t trust advertising as much as they trust reviews from their peers. Some 100Reviews customers are earning $50-100K+ annually on their sites. They include sole proprietors who don’t have the benefit of membership lists, and existing advertisers and sponsors. Learn why associations are perfectly positioned to provide online review resources for members’ workplace buying decisions.
  • Micro-learning: In today’s attention-starved society, the ability to acquire solutions to problems, or gain new skills quickly and effortlessly, is an opportunity for most associations. Can your organization help members resolve specific issues they face at work with 10-30 minute educational segments for a modest fee? We all yearn for quick, uncomplicated, straightforward answers to the problems we face at work. Hence short, fee-based, educational modules are a potential opportunity for associations seeking non-dues revenue.

Be reminded that non-dues revenue programs may trigger Unrelated Business Income Tax (UBIT) for your association. Consult a tax lawyer for a professional opinion on whether or not your non-dues revenue programs may subject your association to UBIT.

LOVE this topic? We’ve got a free webinar coming up that you’ll love even more! 

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Unlocking the Member Voice: An All New Member Benefit and Revenue Generator
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