Association Growth in Emerging Markets, Part I
Many U.S. membership organizations have considered at one time or another expanding to foreign shores as a way to grow membership and revenue. Many fail to try—or try and fail—because they don’t know where to start or what to do.
Erik Schonher, vice president of Marketing General Incorporated, and Terrance Barkan, CAE of GLOBALSTRAT, have collaborated on a recently released white paper that shares important tips about how associations can gain a foothold in the global marketplace. Together, the two authors have more than 50 years experience in international association strategy and membership recruitment, retention, and recovery.
This month and next, the MGI Tipster will reproduce excerpts from their white paper entitled, How to Grow Your Association in Emerging Markets Using Strategy and Tactics. We hope any association executive interested in exploring the potential of the international marketplace will find this useful.
Grow or Perish
Growth is essential if membership organizations are to remain competitive and relevant. But many organizations have discovered it is increasingly difficult to find new growth opportunities in mature and well-served markets, such as North America.
Despite the global recession, there are countries and regions that have continued to grow, some quite rapidly. Whether in Boston or Bangalore, associations can thrive in today’s highly globalized world when they tap into opportunities in emerging markets.
These market openings, however, can carry significant obstacles and challenges. Emerging markets lack the structures, transparency, information, and access to prospective members that are common in more mature economies. However, for associations that have education, certification, training, networking, and related services, these same obstacles can be turned into market opportunities.
The Basics: Adapting the Membership Lifecycle
The dynamics of the association Membership Lifecycle apply just as much in the international marketplace as in the domestic. To thrive in a highly globalized world, association leaders should understand how the five steps of the lifecycle fit within the context of an international strategy coupled with local tactical growth plans.
Awareness…when prospects first discover you. Especially in emerging markets, new channels such as social media are making once-unprofitable markets economically attractive. Combined with acceptance of a common language, English, associations are finding greater access to new markets than ever before.
Recruitment…when prospects choose to try you. Emerging markets are filled with aspiring individuals who want to better themselves and their professional prospects. Associations that offer attractive services and valuable benefits that allow members and customers to address their local needs usually find receptive audiences.
Engagement…when new members feel they belong with you. Engagement is fundamental to high retention rates and sustained membership growth no matter where the organization may be located. Engagement programs that drive local and regional allegiance are a crucial lead-in to Renewal.
Renewal…when lapsing members decide whether to keep you. As the needs of international members evolve, so, too, must associations keep pace and provide compelling reasons for them to remain with an organization.
Reinstatement…when former members agree to return to you. Reinstatements are a regular component of membership growth programs that every organization should have in place regardless of location.
Why Emerging Markets?
Emerging markets are countries experiencing rapid growth, industrialization, and modernization. Examples include Brazil, Russia, India, China, South Africa, Indonesia, Malaysia, Thailand, and Nigeria that together represent hundreds of millions of people.
The Conference Board, a global business association, has projected that emerging economies grew 6.6 percent in 2011, much higher than most industrialized nations. The Board projected that emerging economies will grow on average 6.3 percent per year through 2020. Further, they report that in 2011 emerging economies collectively added three times as much to the global GDP as advanced economies.
Not all emerging countries are similar, of course, nor do they offer the same levels of opportunity for associations. Differences in language, culture, political stability, trade agreements, and historical trade patterns all influence the pace of growth of individual countries.
Why Emerging Markets Need Associations
Especially in emerging markets, where local businesses and business people often struggle to differentiate themselves from one another, affiliation with a prestigious association can be a genuine competitive advantage. Associations can become invaluable assets to the professions or industries they serve by identifying market players, measuring the scope of the market, and conducting market research.
Just the last 20 years have seen the emergence of global associations that have experienced truly explosive growth. Organizations like the Project Management Institute (PMI), the Society of Human Resource Management (SHRM), the Institute of Electrical and Electronics Engineers (IEEE), the Society of Petroleum Engineers (SPE), and the Chartered Financial Analyst (CFA) Institute are examples of organizations that now have significant international operations. In some cases, the majority of new members and revenues are generated outside of the United States.
The building blocks of domestic membership marketing readily apply to the international arena as well, with important opportunities in emerging markets that may have stronger economies but fewer sophisticated business laws and regulations.
In next month’s MGI Tipster, we will look at how associations can help foreign markets fill gaps in services, and we will list the key questions that associations should ask before entering the competition.
For More Information
This edition of the MGI Tipster consists of excerpts from the recently released white paper entitled, How to Grow Your Association in Emerging Markets Using Strategy and Tactics by Erik Schonher of Marketing General and Terrance Barkan, CAE, of GLOBALSTRAT. To contact the authors for more information:
Rick Whelan, President, Marketing General Incorporated
703.706.0350 and firstname.lastname@example.org
Terrance Barkan, CAE, Chief Strategist and CEO, GLOBALSTRAT
202.294.5563 and TBarkan@Globalstrat.org