LinkedIn Groups (LIG’s) aren’t the only danger to local associations – Professional Associations with a global focus are one of the factors, larger associations going international pose a similar threat and are the second giant component of the new world of ‘hypercompetition’. For small English-speaking countries like Australia, the biggest challengers are the USA and the UK.
These giants Associations are also feeling the effects of the two big threats: Baby Boomers retiring and the spread of free Social Media platforms. Therefore maintaining and growing membership in their domestic markets is just as challenging for them.
When expanding offshore, the larger Professional Associations have four major advantages:
- They have lower member fees than those in smaller countries due to economies of scale – more members to spread their costs across.
- Their fee advantage is
greatly increased when they have gone global or international associations: much lower fees are available for membership branded as ‘International’ or ‘Online’. These reduced fees are not available to their home members – it is classic ‘marketing segmentation’. The overseas fees represent virtually all profit and their real ‘cash cow’ – the giant revenues stream from their home market – remains protected
- They can provide more services as they have more members to spread the costs across, and can also promote the benefit of international connections.
- They can afford to purchase and implement new cloud-based services (SAAS systems) that make running International Associations so much easier, cheaper, and enables better and more personalised service delivery.
Given what they can offer, these giantAssociations are a major threat to local Associations’ membership growth. Especially as they offer the most profitable services first – training and education, and ignore the services that are expensive to provide and many members are reluctant to pay for – namely advocacy and industry research.
But what if your members are companies, not individuals
For Associations who’s members are companies (rather than individual professionals) the entry model is slightly different. They offer training and networking of course but need to employ additional lobbyists and source local research to be successful.
For smaller sized Associations, this can be a difficult and expensive endeavour, giving the offshore Associations the upper hand.
International Professional Associations, therefore have the following advantages:
- Lower overheads and infrastructure requirements – as much will be provided by the parent organisation, and some can be performed via a virtual office.
- Global corporations – usually the biggest and most valuable supporters – strongly prefer to engage a single provider covering multiple countries.
- Some of the issues requiring research and lobbying will be common across multiple countries, lowering the costs of researching and presenting the issues.
Despite these advantages, however, many local Association executives continue not to recognise the threat they are under.
The next post will discuss an often unrecognised global threat to small Associations – online forums.
Cheers, Toby. [C116]
Toby leads a team of young international B2B marketers at Lead Creation