Why a Business Development Strategy is Vital to Association Revenue Health

Associations aren’t effectively strategizing. That is one of the key findings from the Professionals for Association Revenue (PAR) Association Business Development Landscape Survey in which 86% of respondents said their organization’s business development strategy is underperforming or non-existent.

That’s a problem for associations working to remain relevant in a changing economic landscape. Association strategist and author Mary Byers says an effective business development strategy informs decisions that help associations evolve.

“A business development strategy is imperative for one reason: sustainability. As revenue streams dry up and the value of association programs and services changes, we need to evolve accordingly. Associations aren’t known for doing this nimbly,” Byers says.

An important first step is understanding the role competition plays in revenue health. Competition necessitates strategy and associations that fail to view themselves as competing for members, corporate investment dollars and overall relevance will fail to see the value in a business development strategy.

“Many associations are competing for a piece of a shrinking pie,” Byers says. “Associations’ continued existence demands recognizing that competition has accelerated and isn’t likely to slow down.”

Here are three steps associations can take to create a business development strategy.

1. Strategize First, Plan Second. Renowned strategy adviser Roger Martin says there is a key distinction many of his clients fail to understand: planning is not the same as strategy.

“In short, strategy is the act of making an integrated set of choices, which positions the organization to win; while planning is the act of laying out projects with timelines, deliverables, budgets and responsibilities,” Martin writes.

Associations plan for the things they can control like events, webinars and membership campaigns. But PAR Leadership Advisory Board Chair Sean Soth says strategy requires an agreed upon ideal for the association that answers the question, ‘How do we win in our market?’ Finding this answer allows each association team to make nimble decisions with the organizational goal in mind.

“If you want to have the best member experience, you can, but it will require trial, error and evolution. If your non-dues revenue programs aspire to be the best options in the market, know that this will require constant change and improvement and even some failures to get there,” Soth says.

2. Focus on the Future. Byers says an easy first step in creating a business development strategy is to ask the question, ‘Where will our revenue come from tomorrow?’

“Though the question is simple, the answer may be complex. You will likely have to figure out a way to create tomorrow’s business while you are servicing today’s,” Byers says.

This can mean serving current members while appealing to a new generation, executing an event while rethinking its future structure, and serving sponsors while developing more effective long-term partnerships. Each of these exercises requires associations to consider their value. It’s why having a strong value proposition is an important component of strategy development.

“The proposition part of the value proposition is really the promise that you will deliver this value,” says Sylvia Gonner, global growth strategist and founder of Culture Wiz. “It is going to help you focus on what matters. Using the value proposition to help lead decisions helps ensure that you will deliver on that promise.”

3. Have the Right People Involved. Developing and implementing an effective business development strategy requires a cross-departmental approach. Soth says a siloed approach to strategy won’t work.

“With many associations, the outcomes are tied together but the execution is disparate. Conferences, as an example, require several departments working together for a shared outcome. Could non-dues sponsorships and exhibit sales improve with advanced programming, marketing, content tie-ins? Absolutely. Business development strategy brings these pieces together so team members know where to contribute."

Associations should involve department leaders and revenue producers who deal directly with customers. Once a strategy is agreed upon and planning begins, Byers says the association must have the right sales staff in place to execute.

“As you think about business development strategy it’s imperative to make sure a sales role is part of the equation. I’m seeing more and more associations add sales expertise to their staff teams and I think this is overdue.”

A business development strategy helps align association teams to work toward a shared goal. Associations that operate with a competitive mindset focused on revenue growth and customer value will understand how strategy informs planning.