Reinventing the Membership Model

Rethinking Membership Associations Now July/August 2019 Issue By: Tim Ebner

Stagnant membership growth, underutilized benefits, potential new members hiding in plain sight—these may be signs that it’s time for a membership model redo. But how should you restructure? Three associations made adjustments—big and small—that add access, equity, and ease to the member experience.

When Garth Jordan, senior vice president of corporate strategy at the Healthcare Financial Management Association (HFMA), talks about membership, the conversation often turns to Netflix.

The video-streaming service now reaches more than 139 million people around the world with binge-worthy hits, as well as popular movies and reruns, served up based on a subscriber’s individual viewing preferences. “It’s all access, all the time,” Jordan says. “If you’re a Netflix customer like me, you pay a simple fee to gain access.”

About two years ago, as part of a digital transformation at HFMA, Jordan started describing a new membership model to his colleagues that would mirror the experience Netflix delivers. His goal was to create a new, digital-first model that gave all members subscription-style access to a full slate of benefits and yet was unique to every individual.

“When I said we wanted to become the Netflix of associations, I meant that we wanted to create a member experience that felt valuable to everybody,” he says.

Membership as a subscription is just one way in which associations are rethinking membership structures, benefits, and dues. And it’s a question on many association leaders’ minds. In this year’s Marketing General Incorporated Membership Marketing Benchmarking Report, 51 percent of respondents said they’ve either adopted or considered a new membership model in the last five years.

The study also suggests that moving to a new model may contribute to membership growth. Of associations reporting an increase in new members, 22 percent had changed their membership model, compared with 14 percent that had not.

The potential for growth is certainly one reason for a membership redesign. Others may have more to do with encouraging participation or improving the member experience. Regardless of the objective, associations are taking creative new approaches to make their membership models better align with their members’ preferences and the realities of their changing professions and busy lives.

Consider three examples where associations found success by adding access, equity, and ease to their membership models.

1. All-Access Pass

In May, HFMA launched its all-access membership model, which replaced a traditional tiered structure that separated members into several groups, including business partners and professional members. Although those categories for now are still used, membership dues and benefits are the same for almost everyone, priced at a flat rate of $425 per year. (Faculty, student, and retired memberships are available at lower rates.)

The new price is $90 more than HFMA’s base-level dues last year, but the increase hasn’t affected retention, Jordan says. So far, renewals are 17 percent higher than they were a year ago. He credits that early success to the model’s flexibility: Whereas previously, different types of members had different levels of access to specific products and services, now everyone has freedom to explore all of the association’s content, professional learning, and online resources.

The digital transformation prioritizes personalization. HFMA is implementing systems that will feed member data into engagement platforms built on automation, and it’s considering new and emerging technologies like artificial intelligence to maximize each member’s individual experience.

“When we first came at this idea more than two years ago, it was with the idea that there are 38,000 HFMA members, which means that there should be 38,000 different member experiences,” Jordan says. “Like Netflix, we are watching and learning to see what our members do, so we can add to their experience.”

51% The percentage of association leaders who have either adopted or considered adopting a new membership model within the past five years.

Source: Marketing General Incorporated's 2019 Membership Marketing Benchmark Report

2. Focus on Equity

As at HFMA, the membership remodel at EDUCAUSE focused on giving members better access to the things that provide value for their dues. But Director of Membership Jim Burnett says the reinvention grew out of a realization that EDUCAUSE, an association for IT professionals in higher education, served some members better than others, providing different benefits and resources depending on the category of membership.

“We took a look at the old model and essentially created something that was about serving the entire community, not just some,” Burnett says.

The new approach was approved by the board in 2016 and guided by the new president and CEO, John O’Brien. It was based on a five-year plan and set of strategic priorities that aimed to unify and expand membership.

The new model, known internally as “One EDUCAUSE,” has helped create new pathways to membership, including an emerging ed-tech membership category that has attracted about 70 startup businesses.

“We’ve seen substantial growth in this category,” Burnett says. “It correlates directly to an interest that was voiced by our institutional members who wanted to better understand and engage businesses like these within the ed-tech landscape.”

The most noticeable change: EDUCAUSE added equity to its dues rates. Dues are now based on a pricing matrix, in which the amount varies depending on an organizational member’s size and classification, determined by the Carnegie Classification of Institutions of Higher Education.

“What it meant was that larger institutions with larger budgets would pay more than smaller institutions with smaller budgets,” Burnett says. “We wanted to make sure we were being fair and delivering on our value proposition to all of our members.”

To get here, EDUCAUSE staff spent several months listening to members in focus groups and town halls and collecting input through member surveys. (See “Five Questions to Ask Before a Membership Redesign” at right).

“As you launch a new model you have to always listen first, then communicate why you’re making changes,” Burnett says. “And be sure to detail what impacts will be felt with existing members.” For EDUCAUSE, that meant picking up the phone and talking with members, so that they understood how their dues would change: Some members would experience an increase, while others would pay less.

So far, there’s good news to report. In a 2018 membership survey, a large majority of members, 82 percent, said the value of their membership equaled or exceeded the cost of their dues.

“I think at this point, we can call our transition a success,” Burnett says. “Our membership is growing, and it is a result of very deliberate work that takes an objective look at our expanding membership.”

3. Easier Entry

Another indication that it may be time to make a membership model change is if you have a lot of potential members hiding in plain sight.

Neil Reichenberg, executive director of the International Public Management Association for Human Resources, says the sector his association represents—professionals who work in government HR—is by no means a high-growth field. Still, there was room for IPMA-HR to bring in new members, given two facts. First, only a small percentage of government HR professionals were members. And second, because the association’s organizational membership model based dues on the number of employees covered by a membership, many government HR departments opted to include only some of their employees so they could select the smallest organizational membership option available.

“Some governments have a rule that says you have to pick the lowest or least costly option if you’re going to join a membership,” Reichenberg explains. “What we had was a situation where 80 percent of our organizational members were at the lowest level of our tiers.”

IPMA-HR didn’t need a complete overhaul, but rather a refinement that would bring in new members who had been sitting on the sidelines for years.

“We decided to flip things around,” Reichenberg says. “Rather than say to HR departments, tell us how many people you want to cover [for membership], we said to them, an organizational membership will now cover all of your professional staff, so please tell us how many staff there are.” Now, members are placed in one of five membership tiers based on staff size.

For most existing members, dues did not increase substantially. For those that did see an increase, including larger organizational members, rate caps were implemented to avoid sticker shock. “You can’t go from having a member that paid $1,500 a year and suddenly think they’ll pay $20,000,” Reichenberg says. “It’s simply not going to happen.”

While this change wasn’t radical, it addressed a practical challenge facing the association’s market and is resulting in significant growth, increasing IPMA-HR’s membership from about 6,000 to over 7,500 since the new model was launched in January 2018.

Reichenberg says the challenges facing IPMA-HR aren’t unique. “I think a lot of professional associations are struggling right now with issues of attracting new members,” he says. “We had to take a step back and say, how can we make some changes that help us adapt and stay relevant to our community’s needs?”

Tim Ebner

Tim Ebner is senior editor of Associations Now in Washington, DC.