April 2, 2022
For associations, revenue falls into two categories – dues revenue, meaning the cost for your membership, and non-dues revenue, which is basically everything else. Because there are many ways for organizations to generate income, defining and experimenting with non-dues revenue opportunities can be a challenge.
This guide will discuss some of the common challenges facing organizations, places to start when looking for non-dues revenue ideas, and the mindset needed to create lasting opportunities for your association.
The simplest way to understand non-dues revenue is to think of it as any income your organization earns outside of annual member dues. It can include things like conferences, educational training, and advertising.
According to ASAE, about 30% of an association’s income stems from member dues.
While there are some associations with well-established and dependable non-dues revenue methods, most are left trying to find a creative way to fill that 70% difference.
When trying to make up the difference, one consideration is to raise your membership dues. While this does happen successfully for many associations – especially when adding value to membership in the form of new course offerings or certification – more often than not, organizations will face pushback.
However, when there are economic concerns, the potential threat of COVID-related shutdowns and a willingness to make budget cuts and changes, it likely shouldn't be the first strategy for your association.
So, if increasing membership dues is not an option, what can association leaders do?
Association leaders know that non-dues revenue is essential – but they also know coming up with ideas can be challenging. So what’s the trick to finding the perfect non-dues revenue idea? Teri Carden, Founder of 100Reviews, says these ideas should “fall in the center of concentric circles – it has to be good for the individual, it's got to be good for the industry as a whole, and it needs to generate revenue.”
Some common examples that many associations leverage include:
This list is by no means exhaustive. However, there is a pattern among all the ideas – they’re mutually beneficial to members, organizations and partners.
Whether you're adding professional value, like with a new certification to advance their career or helping connect your partners with an already engaged audience, your non-dues revenue ideas should always work to hit that mark.
One of the biggest challenges with creating non-dues revenue is coming up with ideas. While many of the examples above can seem obvious, what happens when they’re not a fit for your specific organization? Or better yet, how can you create them from scratch?
Coming up with topics and strategies for your non-dues revenue can be easier with a few systems.
Most associations are already collecting data in some form or another – whether that be member calls or your annual survey. As long as it has the qualities of good data, meaning it’s up to date and covers a diverse group of your members, you will quickly have the insights you need to start coming up with non-dues revenue ideas.
Are there programs your members seem particularly interested in? Is there a topic you haven't covered that’s affecting your industry? Should there be a paid event or networking opportunity that your members need to advance their careers?
This is also a great opportunity to allocate outside resources to analyze your data. Because staffers are so involved in the day-to-day, they may have overlooked some of the low-hanging fruit your organization may have. “Having an outside set of eyeballs looking at the data set and asking tough questions results in thoughts, ideas and opportunities bubbling to the surface that may never have crossed anybody's plate,” says Carden.
More importantly, don’t be afraid to be transparent with your members. Add new questions to your annual survey to see areas of interest you’re missing and be sure to open up the discussion regarding costs. Knowing how much your members would be willing to pay for a particular program or offer can help get buy-in when the time comes to introduce new non-dues revenue ideas.
One of the most significant assets an association has is its members. They are highly focused on professional and personal development and have specific interests that could be of value to businesses in the space.
Michelle Schweitz, Marketing Director of Community Brands, says, “selling sponsorships is a highly effective way to drive non-dues revenue. It also gives companies in your industry exposure to a targeted audience (your members) while giving your members information about relevant products and services.”
So how do you do this? Sponsorships for your event, digital ads on your site or even a hosted webinar can all be options. However, it’s vital to ensure these partnerships are the right fit for your members. As a trusted source in your industry, the last thing you want to do is become a hub for constant ads – as this can create some pushback amongst your members.
Whether you’re on the board of directors or the C-suite, you need to understand that getting a successful non-dues revenue program off the ground takes time, money and effort.
For starters, you need to allocate time to brainstorm ideas, establish metrics to determine success and a strategy for implementation. Additionally, you need to be able to allocate money toward these projects. This can mean hiring an outside consultant to review your data or simply bringing on another staffer whose primary responsibility is non-dues revenue.
From there, it takes effort. That means brainstorming ideas, bringing in your members to test new initiatives and re-tooling them until they become a sustainable source of non-dues revenue. In many cases, non-dues revenue requires an entrepreneurial mindset, so having a diverse team is essential.
Members join associations because they want to solve or prevent a problem they see in their career or industry – and providing solutions to these issues can be a great way to generate non-dues revenue.
If your members are in the digital marketing industry, create and sell templates that help them solve a problem they come up against regularly. If they work in the film industry, create a comprehensive list of resources like warehouses, studios, equipment rentals and freelancers that would be incredibly useful. Or if they’re fundraising directors at nonprofits, host a workshop on how to bring in sponsorships.
The key is to think about what would make their lives easier, then work from there to create it for them!
Coming up with non-dues revenue ideas is just half the battle. There are other challenges you may find along the way that could be holding up the non-dues revenue process.
Whether it's the Great Resignation causing staffers to change roles or budgeting issues, chances are your organization may be understaffed at the moment. This can leave associations struggling to figure out ways to leverage dwindling bandwidth to experiment with new programming and initiatives.
One way to fix this is to use the resources you already have.
For example, monetizing existing events and webinars with new partnerships, selling ad space on your already popular newsletter or refreshing content as a new premium offering. The ideas that are the easiest to get off the ground are likely the ones you should focus on when starting.
Also, if your staff is already stretched thin, it may be time to consider sunsetting some older, less-successful programming to help focus on these new ideas that can help drive revenue even further.
Just as resignations are affecting your staff, they’re likely affecting the mindsets of your members as well. More young professionals are entering the workforce, and their priorities, needs and wants are likely much different.
Millennials and Gen Z, who will be entering the workforce shortly, are looking for ways to grow in their careers. As such, monetizing a networking or mentorship program, for example, can be a great way to create non-dues revenue.
Similarly, your older members may be more concerned about their health and future, which is where an insurance-related affinity program might come in handy. The point is to realize that your member demographics vary and assessing the validity of a non-dues revenue idea through that lens must be considered.
Associations are often known for their fear or hesitancy for change. Because of this, getting buy-in from your leadership is likely going to be one of the bigger hangups when it comes to trying out new programs.
One way to help work through that resistance is with transparency. When creating a new non-dues revenue idea, you should:
Finally, your members will have the final say as to whether or not a new non-dues revenue program works, so getting their input often and early is essential. One way to do this is to take your idea to market early on to test the reception.
“Getting people involved in the early stage helps foster cheerleaders for the idea and allows for adjusting the plan based on how it's perceived in the marketplace,” says Carden.
Once it’s out there, you can determine whether you need to make changes like shifting the price point or modifying the program. Also, you can avoid going down a rabbit hole with a plan and waiting for it to be “perfect,” only to realize it isn’t a great fit for your organization.
An important part of finding new revenue ideas is seeing them in action. Some of the best examples we could find of associations experimenting with non-dues revenue include:
The most important thing association leaders need to think about when looking to create non-dues revenue is that it takes an entrepreneurial spirit, plenty of trial and error and open-minded leadership. There is no perfect way to try new non-dues ideas, and waiting for that can slow innovation and leave you with a new program that doesn't work for anyone.
While non-dues revenue can seem like a somewhat vague or complex topic, the reality is it can be measured and tracked like any goal you set in your organization. Setting specific and measurable metrics and working as a team to evaluate and assess growth can help take some of the risks out of new programming.
And if the new idea doesn’t work? Remember that you shouldn't be afraid to try the next thing – if the last few years have taught us anything, organizations should always be ready to pivot into something new.
If you’re ready to increase your membership organization’s revenue, connect with an entire community of purpose-driven leaders and grow yourself, we’re ready to help you do it.Learn More
Jose Triana joined the Sidecar team as the Content Manager in 2021. He is a writer and creative focused on helping purpose-driven organizations learn and find value online. When he isn't working on content, you can catch him going for a run or resting with a good book.