NUCLEUS ANALYTICS BLOG

Making the case for Data Analytics being budget-neutral in Year One

At most associations, it is difficult to argue that better information is not a good thing – that better understanding your current members, potential members, and the broader constituency would not benefit the organization.

It’s also difficult to argue that Data Analytics, in today’s era of so much member data spread across so many systems, does not provide better information. 

One of the ways in which Associations differ from many commercial businesses is in the requirement of associations to draft and approve an annual budget. The budget cycle drives the annual organizational cadence and often elicits protracted debates to establish the rates for membership dues, annual meeting registration fees, the price of a 10X10 exhibit booth and much more. The problem is that the data points to support the debate are often limited – mostly historical activity, some trend data, and some minor input from the association board. 

As data continues to grow at a phenomenal rate, data governance is becoming an ever-more important organizational activity for associations and for more reasons than ever should probably be an ongoing initiative at yours. Data Governance has been defined as “a collection of practices and processes which help to ensure the formal management of data assets within an organization. Data governance often includes data stewardship, data quality, and others to help an enterprise gain better control over its data assets, including methods, technologies, and behaviors around the proper management of data.”

We spotted a visualization published by MarketingCharts.com recently that is striking. They surveyed more than 200 marketers at major North American brands and asked, “if you had extra marketing budget, where would you invest it first?” They found that the leading response (more than double the next response) was to spend extra marketing budget on data analytics technology.

Community Brands recently published a large-scale study that detailed 8 strategies association executives can use to modernize their organizations for 2020. In recent years, “Modernize” has become a buzzword for associations looking to make the most out of available technology in the same way that “superfood” has become a buzzword used to sell kale and blueberries. While navigating the world of quinoa and chia seeds can be frustrating, difficult, and often tasteless, it is almost undeniably good for you - as is properly-executed “Modernization.”

Inefficient as it sounds today, it was not uncommon in the 1990’s to hear that an association was going to build their own Association Management System (AMS) rather than purchase an existing one.  When we heard that, we’d generally put a reminder in our sales tracking system to contact them again in 18 months. By then, most would have spent a lot of money, failed to achieve the goals established by the organization, and lost some or all the technical staff who were working on the project.  For those who persevered and were mildly successful, they were still challenged with retaining their key technical talent and keeping the system up to date. By the mid-2000s, you seldom heard of an association taking this approach.

When Gravitate CEO Tim Ward and I released Avectra’s NetForum in 2004, it was not uncommon for an Association Management System (AMS – or sometimes known as a Customer Relationship Management system - CRM), to join the organization’s accounting system and website as the three primary systems that an association needed to successfully operate its business. At the time, we had successfully stamped out most of the data silos that plagued associations in the past.

Early in my career, I was asked by a large scientific society to write a report for them that compared year-over-year and month-over-month membership renewal numbers.  They were running a SQL-based association management system (AMS) so I embarked on a journey to write a complex stored procedure to support a Crystal Report. For those of you who have experience writing stored procedures, I had to employ many temporary tables and While Loops to achieve the desired outcome.

I worked for two trade associations – the National Association of Broadcasters and 340B Health – both of which were obsessed with member retention and delivering member value. Not an uncommon pursuit at any association. One of the best ways to illustrate the value you are delivering a member is to show them the Total Member Value (TMV) your organization provides them.
For years the chosen method to demonstate value to members for their dues payment was to provide them a profile report from the Association Management System (AMS), which generally listed all the products and services they received and all the other activities in which they participated. This approach had the following weaknesses:

When we analyzed our Nucleus data across all our clients, we discovered that, on average, the Association Management System (AMS) or Customer Relationship Management system (CRM) comprises less than 20% of our client’s data – and that only includes the systems our clients have asked us to manage.  What’s more is that this percentage is falling as data in solutions such as email marketing, web analytics, and social communities grow at a rapid pace.