Getting the right mix of revenue streams isn’t easy. An association may have several large revenue generators like membership, meetings, and education, as well as many smaller ones like publications or mailing list rentals.
Each source of revenue requires attention – someone on your staff whose job is to pay attention to the details and keep the program thriving. That’s no problem if you have a large staff or have staff members with additional bandwidth. If, however, you’re working with a smaller staff, it can be easy for your team to become overloaded and distracted as they monitor legacy projects and launch new ones.
How can you tell when you have too many revenue streams? And if you do have too many, how can you decide which ones should stay and which should go?
The first research you do should be with your team. Ask them how they feel about the programs and services they manage. Is everything great or are they overwhelmed? Are there programs that are unnecessarily difficult to manage?
Once you take the temperature of your staff members, you can start to add facts to feelings to make solid decisions for the future. We have a few suggestions for determining the future of your revenue streams:
- Consider Your Goals
When you review a legacy program, ask about the goals associated with it. Was the association trying to make the most money, keep something for old-time’s sake, reach the most people possible, or something else? Consider if those goals are still viable and serving the association. If not, it might be time to review the program.
- Consider the Problems You’re Trying to Solve
It’s true that if you don’t know where you’re going, any road will get you there. As you consider each program or service, ask what problem it was designed to solve. Do your members and customers still face the same problem or are they facing new challenges today? Your answers should help direct you as you continue this review.
- Consider Internal Data
It’s important to not rely on gut feelings or instincts. Remember, the data is always key. Use the data from your AMS and financial systems to answer the following questions:
- How are members responding to certain revenue streams?
- How much revenue is each program bringing in?
- Which demographic of members are engaging the most with each revenue stream?
This type of analysis may seem rather cold-blooded. It’s supposed to be. You need a data-based view of the people who use a program under review. Qualitative research comes later.
- Consider the Competition
When you evaluate programs, think about your competition. Is your program considered best-in-class or does someone else do it better? If you discontinue a program or service, can your members turn to other sources for the same thing? Can your competition use this decision to lure your members away? Is it valuable to direct members to your competition to fill this need? Determine what unique offering your association can bring to your members and prioritize it.
- Consider Conducting Market Research
If it has been some time since you last asked your members, volunteers, and leadership what they need, it could be time to launch a new research project. Are you certain that what your members and customers value is the same as what you “think” they value? Disruptors are everywhere and are almost certainly acting on the industry you serve. Do you understand how the industry is changing? Talk to your members informally or formally, but give them the opportunity to increase your knowledge.
Members aren’t the only consumers of your programs. Dedicate some time and research to determining if there is a larger audience for your products. A program that is a member benefit could also be attractive to non-members either as an incentive to join or with a non-member price.
- Consider the Cost of Maintaining a Legacy Program
Because of their longevity, legacy programs may be inexpensive to administer, providing a higher profit margin than newer programs. Likewise, they may have ongoing administrative costs that eat into profits. Before sunsetting a legacy program, be sure to understand the profit margins associated with it.
- Consider Technology
Although buying new technology is not always the answer, your team may find it easier to administer programs with an assist from new, targeted technology. New technology may provide new ways to manage legacy programs. It may also help save beloved programs that have become cumbersome to administer. Technology is designed to automate and simplify the work you and your staff do.
Now Is the Best Time to Act
So far, we haven’t said one word about the pandemic, but we’re about to break the silence. With so many things changing because of shifting disease protocols, now may be the perfect time to evaluate your programs and services. Lockdowns and travel restrictions have dramatically changed our planning and made flexibility more important than ever.
Chances are, you’ve had to prioritize your programs and focus only on the most important. We might be in the best environment possible for sunsetting legacy programs you no longer need. It may also be the best time to reorganize your staff and volunteers to address top-of-mind challenges. With sweeping changes confronting all of us, small changes in how you do business may be easier to accomplish.
No one knows the best plan for your association better than your staff and members – by being transparent and having honest conversations, you’ll gain a lot of insight into what’s right for the organization. Making big changes to your association’s revenue structure can seem scary. But with the proper research and data you can feel confident in your decisions.
Emma is the Marketing Manager at Rhythm. When she's not thinking about all things content-related, you can find her traveling or shooting 35 mm film.