Marketing Research Proposal: A future for Chambers of Commerce

The purpose of this marketing analysis is to deduce how membership associations' fate may be controlled by a previously inconspicuous demographic, and why these organizations have resisted acknowledging this change since 1599, when the first chamber of commerce (CoC) was crested in Marseille, France (Haagensen, n.d.). During the following four centuries, membership-driven associations like CoCs have become globally ubiquitous non-governmental institutions. A mission of these organizations has been to promote national, regional and local business interests, and they have also spun off into various “professional affinity groups,” like ones the American Bar Association and many engineering societies have sponsored for college and graduate students (Junker, 2007). GuideStar, a recognized resource on more than 1.8 million IRS-recognized organizations, respectively indicates 7,740 CoCs and 9,530 mutual benefit/membership organizations (GuideStar, n.d.). By some measures these numbers might suggest the classic CoC/member association business remains a sustainable one. Yet, a question lingers as to whether the dues paying structure upholding these organizations will continue to remain relevant - or become redundant – as the half millennium anniversary of the dues-dependent business model looms in the 21st century.

One theory on this perceived irrelevance is based on the Baby Boomer generation, individuals born between 1946-1964, transitioning out of work and into retirement (Junker, 2007). Many membership associations estimate 10-20 years remain until all 77 million Baby Boomers will retire (Pew, 2010). This “shift in human capital” — reportedly the largest move in American history – is possibly membership associations’ largest peril because most continue to be populated and sustained by the Baby Boomer generation” (XYZ, 2011, para. 4). These organizations also potentially suffer because they persist with an insular view that rails against creating diversified deliverables to attract younger members (XYZ, 2011). These observations are significant because, as Junker (2007) cites the research of Arthur C. Brooks, during the mid to late 1950’s, when Baby Boomers were first nearing working age, “there was a strong correlation between joining neighborhood associations and joining professional associations" (para. 6). When neighborhood associations started disintegrating halfway through the 20th century, it was assumed professional and trade associations would face the same fate. Ironically, professional associations’ triumph through this period was why neighborhood and community associations deteriorated. "Two-earner couples no longer had time to build deep roots in a physical community,” as evidenced by more frequent moving than was typical immediately following World War II. Instead, a cresting wave on personal/professional values in the 1950’s anchored a desire for community.

1

Baby Boomers’ children, known as an "echo” of 80 million individuals “out to save the economy” (Wile, 2013) also embody this pattern of moving, particularly for job and career changes. As a result, professional networking is particularly vital to younger employees, especially individuals born between 1980-1995 (Junker 2007). Therefore, associations’ capacity to offer Young Professionals (YPs) a work affiliation-based community, rather than a geography-based one, can dually satisfy a community and networking need (Junker, 2007). Conceivably, precocious associations can simultaneously boost younger and older members’ experiences by congregating the two demographics. Junker (2007) quotes Brooks' advocating trying “to tie generations together in mutually beneficial ways." As Brooks comments, "Young people in associations are super keen on building capital in their businesses, building expertise, building successful careers." Meanwhile, many older members nearing retirement wish to pass on the knowledge they've gained. Bi-directional mentoring relationships could satisfy both interests.

Junker (2007) also notes Brooks’ specifically nominating college students as “incredibly valuable resources for associations. In addition to being “significantly more likely to join an association,” Brooks explains that "Dealing with college students, you're in the most fertile population for the future of associations that will bear fruit as graduates age and become active in the workforce”(para. 12). For this reason, it makes sense to survey Marist College's IMC cohort about perceptions on the future of membership associations, including feelings on CoC member structures, dues models and innovation. Three frameworks on which the survey will seek feedback are:

1)      Freemium – social media communities like LinkedIn and Facebook, which do not charge a fee in exchange for networking opportunities and content, may represent an archetypical model for offline associations. This structure would provide “benefits and content” to individuals the organization deems fitting particular qualifications, and “charging a few (dues) for those who want to upgrade to more benefits/services” (Drake, 2012). Consider that “Facebook is the world's largest association with over a billion members and anyone can start a group for free. Many people are no longer willing to plop down dollars for the privilege of belonging. They need more tangible value” (Kahan, 2013).

2)      Open Source – this horizontal business model is arranged into flexible functional areas that can quickly address a broad swath of challenges and opportunities. This is achieved, in part, by building capacity – once devoted to tasks like securing membership dues – for swiftly deploying resources like bespoke content. Drake (2012) highlights that content, a legacy “primary domain” which has historically been concealed behind a “member only firewall” by many associations, is now largely available online, for free. Kahan (2013) adds that this

2

kind of “education, previously a core value proposition, is now available everywhere to anyone who can search, which is everyone” (para. 3).

3)      Classic - This method requires annual dues for information consumption and connection with colleagues, and utilization of CoC marketing/advertising platforms. An issue with this model is the perception that it may be “incongruent” with how people — like a “tech-savvy” (younger) audience — “connect, engage, and commit" (Fuller, 2011).

The hypothesis is that at this turbulent intersection of “demographic shifts, technology and economy” a hybrid of the freemium and open source models will be most popular across all demographics in the near term, and be regarded as a viable, technology-driven evolution of the classic CoC/association model (XYZ, 2011, para. 3). An open source freemium network will preserve the familiarity of historic association structures for current CoC Baby Boomers, while deliberately acknowledging and consistently leveraging progressive trends appealing to younger demographics that will be CoC successors. Also, it is theorized that in order to authentically capture millenials’ attention, CoCs will need to demonstrate the spirit of “social responsibility” through volunteerism and “giving” (XYZ, 2011, para. 6). Volunteering can be used by a CoC to reinforce its specific mission, a message which clarifies and amplifies the “unique, exclusive, relevant benefits a member stands to gain in return for paying dues” (XYZ, 2011). “Giving” – whether time allocated for staff volunteering or devising business innovation, like reinvigorated membership structures – can demonstrate a commitment to lowering operational costs that translates to more customized member value and membership growth (Paul, 2011). As the economy continues to recover following the 2008 recession, close to 1/3 of millenials (ages 18-37) feel a “personal responsibility to make the world a better place” by being actively involved with assorted issues and causes, compared with 24% of baby boomers (ages 50-68) and “matures” (age 69-plus) (Ruffenach, 2015). At this time, no unanimous conclusion has been drawn on a best future model for CoCs. This suggests now represents a strategic opportunity for CoCs to reframe the membership structure and build a supple platform that rewards member diversity, earns CoC Board of Director buy-in and minimizes risks, like loss of organizational revenue - a product of being viewed as irrelevant.

3

The data collected in this survey will be reviewed and presented to the Board of Directors (BoD) of the New York-based British American Chamber of Commerce, operating as BritishAmerican Business, Inc. (BAB), the largest transatlantic professional organization. The findings will be repurposed into a curriculum aimed at boosting the effectiveness of BAB's 20 chapters across the United States and the United Kingdom, in light of growing competition from other European American Chambers of Commerce (EACC) and regional membership associations, like the New York-based Manhattan Chamber of Commerce (MCC). The suggested instructional plan for BAB will be to assemble 4 regional groups (e.g., west/east coasts – U.S., middle America; U.K.) comprising the respective chapter's managing director and 15-20 key contacts or Board members from within each local network. These bi-annual sessions will be used to develop informative agendas aimed at preserving the BAB consortium’s legacy and promoting its longevity. Key information will then be reported to BAB’s CEO, who will report the findings as business intelligence at the organization’s general membership summit (AGM) and conference (BABC), which separately convene BAB network members once annually. The desired outcome of the CEO’s state of the council remarks will be to highlight the most critical worries and any dearth of industry best-practices plaguing BAB.

This research study will specifically target individuals in BAB’s proprietary database that are members of the organization’s “young professionals” and “leadership” committees: correspondingly, people with up to 15 years’ work experience, and individuals being groomed as future VPs and c-suite executives. These groups represent the influential Millenials group presumed to hold measurable sway in the future structure of CoCs and membership associations. Prospective respondents will be reached through BAB’s private listserv maintained by the organization’s secretariat, based in New York, and via social media. Survey participants will be contacted in early September – immediately following typical summer vacation time - and in early January, just after winter holidays. Both times signify periods when it is assumed executives will most likely be in the office, not yet overly burdened with work and available to participate in a survey. September-January will be the schedule for the two part study; survey preparation is projected for one month, during the summer. Just after Labor Day, survey phase one will deploy; phase two will launch just after New Year’s Day. Each survey will remain accessible for two weeks, closed, then analyzed for 2-4 weeks. This calendar will permit sufficient time to chronicle research findings for BAB’s CEO to review in advance of the 2016 AGM and BABC. As well, BAB’s communications team may seek external partners to extend the life of these findings in 2016, like Nonprofit Quarterly, “the nonprofit practitioners' publication for information on the latest trends affecting nonprofits” (NPQ, n.d.).

4

References

Drake, S. (2012, June 5). 5 issues impacting future of association and nonprofits. Retrieved

from http://www.engage365.org/2012/06/05/5-issues-impacting-the-future-of-

associations-and-nonprofits/

Fuller, E. (2011, March). Goodbye, dues: the transition from paid membership to free.

Retrieved June 17, 2015, from

http://www.asaecenter.org/Resources/ANowDetail.cfm?ItemNumber=57700

Haagensen, C. (n.d.) CCIMP organization information. Retrieved June 17, 2015,

from https://www.b2match.eu/euromed/participants/183

Junker, L. (2007, January). ASAE ® The Center for Assocation Leadership.

Retrieved June 16, 2015, from

http://www.asaecenter.org/Resources/ANowDetailLeadershipIssue.cfm?ItemNum

ber=46898

Kahan, S. (2013, April 12). Driving innovation. 6 issues facing association leaders.

Retrieved from http://www.fastcompany.com/3008159/driving-innovation/6-key-

issues-facing-association-leaders

Nonprofit directory. Public societal benefit mutual membership benefit organizations.

(n.d.). Retrieved from June 16, 2015, from http://www.guidestar.org/nonprofit-

directory/public-societal-benefit/mutualmembership-benefit-organizations/1.aspx

NPQ. (n.d.). Nonprofit Quarterly: Overview | LinkedIn. Retrieved June 17, 2015, from

https://www.linkedin.com/company/nonprofit-quarterly

Paul, J. (2011, 31 March). Are free membership models the future of associations? Part 2.

5

Retrieved from http://blog.socious.com/bid/30602/Are-Free-Membership-

Models-the-Future-for-Associations-Part-2

Pew Research Center. (n.d.). The millennial count. Retrieved June 17, 2015, from

http://www.pewresearch.org/daily-number/the-millennial-count/

Raising Membership ROI: 3 threats challenge future of associations. (n.d.).

Retrieved June 17, 2015, from http://xyzuniversity.com/2011/01/raisingroi/

Ruffenach, G. (2015, January 19). A generational gap: giving to charity. Retrieved

from http://www.wsj.com/articles/a-generational-gap-giving-to-charity-

1421726453

Wile, R. (2013, February 6). Echo boomers will save the US economy. Retrieved

from http://www.businessinsider.com/echo-boomers-will-save-the-us-economy-

2013-2?op=1

6