Expanding Membership Categories & Models

Blog_16.pngI was responding to a List Serve question yesterday about how to increase the engagement of corporate members when it struck me. Would this question have been asked quite the same way, if at all, by the leading market innovators I have been identifying in my research? If not, why not? I struggled to put my finger on it.

For one thing, these market leaders seem to have shifted their definition of “customers” from an exclusive group to an ecosystem of players, each of whom has an important role in the success of the entire sector.  The Metals Service Center Institute (MSCI), for example, moved from serving the steel industry to serving the entire metals value chain; and from its core membership of service centers to an expanded network that includes manufacturers, suppliers, investors, customers and others.  In MSCI’s case, as in the other cases, this shift became its gateway to growth and profitability.   The association now derived benefit from all points of the value chain.  And it could use its access to the entire metals ecosystem as the basis of a new value proposition:  Joining MSCI was no longer just a way to get a journal and attend conferences, but a one-stop shopping opportunity, enabling members to access and cultivate the relationships and information they needed to conduct their business successfully.

The reason this question would not be very relevant for an organization like MSCI is that no one group would stand out as a special “project” and in isolation from the larger network.  MSCI’s focus is on maintaining and increasing the value of the entire network by enabling all groups to get the most out of each other and contribute to the network’s overall intellectual capital.   This is what we consider the right framework for expanding and diversifying membership models today.

I can think of 4 key strategies to consider in the planning of corporate or expanded membership models.

  1. Reconfigure rather than just add:  Don’t treat the addition or improvement of a membership category as an isolated endeavor but in terms of a reconfiguration of the relationships and flow of value in your entire membership network.  How do your various member categories or subgroups fit within the economic and value ecosystem of their sector, and how can they benefit from each other through their membership?
  2. Clarify strategic business objectives: Institutional/corporate membership (or any category of membership) will not thrive if treated as an afterthought, apart from your core business strategy and membership model.  When asked why they want to expand membership categories or increase engagement, many association executives answer with vague generalities, such as: improve relationships and visibility in the industry; have a pool of potential donors for future initiatives, etc.  A diverse membership basis today gives you tremendous advantage for dramatically increasing, diversifying and sustaining your financial health and value proposition.   Yet, if you don’t have clear strategic objectives and a new business model for leveraging multiple member relationships to improve your bottom line, you will not be realizing the full benefit of a new membership category.
  3. Deliver real rather than peripheral value: The only way to substantially increase anyone’s engagement is to substantially increase the value they derive from your services. No mystery or clever gimmicks are involved here.  Honorary awards, PR opportunities and traditional membership “benefits” are not motivators for busy executives. What will make membership useful and even indispensable to them is its relevance to the problems they need to solve to succeed.  Even a seemingly small solution could solve an important problem for a member company and provide you with a new basis for your value proposition: speedier access to valuable information; filtering content from a plethora of resources executives don’t have time to go through by themselves; access to potential customers; your research findings about your members who are also a company’s target market—all these could make a difference in a company’s success.  This means you have to be able to uncover nuanced needs for solutions that may not be immediately discernible to either insiders or outsiders.  Have you spent time talking to corporate executives to get them to talk beyond their “public” company voice and extract from them what really keeps them up at night?
  4. Serve economic ecosystems rather than one segment within them:  We have been seeing a shift from treating corporate and other kinds of members as lesser members with fewer benefits than the core members, to creating and managing different but equal categories of members within a larger membership community.  The role of the service provider in this networked membership model is to enable meaningful and value-generating relationships in the network rather than push productized benefits.  In other words, the value of the membership depends on the value of the network rather than individual products or groups.

Sermo, for example, has both physicians and institutions in its membership.   But it is how Sermo leverages relationships among these categories to create value for each, rather than the categories in themselves, that is the source of its success.

Physicians join because of the 24/7 access to peers and content resources Sermo provides. They gather on an online platform on which they can participate in specialized, facilitated conversations; collaborate; get and provide advice on difficult cases; share insights and challenges. The member institutions– pharmaceuticals, medical device manufacturers, software companies, government entities, financial companies etc.—are willing to pay hefty annual fees to “listen in” on these conversations.  Sermo’s research analysts often facilitate discussions and ensure that they build on one another.  Moreover, they monitor, transcribe, analyze, store and repackage such content into customized subscription bundles for various tiers of corporate membership. In short interactions among members and member categories can be tapped as a continuous and self-sustaining source of innovation, content and value creation.

And this is the difference between the conventional and network membership models.  In the latter, growth does not occur vertically by simply adding on new membership categories.  Instead continuous growth is achieved by leveraging these relationships to increase the value of the network as a whole; and by enhancing the real life interactions and relationships that contribute to economic benefit.

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