John Madigan's Blog

Chamber Member Savings/Discount Programs

This post is part of an ongoing series on Chamber of Commerce leadership, organization, and membership. The posts are intended for Chamber staff but anyone who works in a membership organization can apply the concepts.

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Chamber Discount/Savings Programs

What often surprises me is how few real (i.e. valuable) discounts Chambers offer their members. A typical Chamber might have a discount for Office Depot and airport parking, but that's it. Why so few discounts?

Or worse yet, Chambers will offer their members "Hot Deals" or "Member to Member Discounts" that would more aptly be labeled advertising/marketing offers disguised as savings/discounts. 

It's a shame. Especially since Chambers have the benefit of leverage. They can leverage the number of businesses and employees they represent to get discounts and savings on products/services used by their members every day. 

So what gives?

A few reasons.

First, most Chambers don't have the time/resources to individually negotiate deals on behalf of their members. This isn't a good excuse because if Chamber don't have time to create new additional member benefits, what are they spending their time doing?

A second, better excuse is that trying to negotiate deals for one Chamber doesn't create enough leverage to get significant discounts. Vender's need thousands of people using the deals, not hundreds.

A third excuse is that Chambers only want to offer deals to their members that offer a commission back to the Chamber. And since the majority of vendors do not offer a commission, Chambers don't offer their deals.

If you're a Chamber staff member and any of these excuses make you mad or frustrated, they should. Chamber can (and should) do better in this regard. How you ask?

One option is to partner with other Chambers/associations. What if Chambers were to aggregate multiple Chamber's members? Then, there would be enough leverage to negotiate serious deals from national brands.

Enter Cost Cooperative.

Cost Cooperative is our newest partner at the Santa Monica Chamber (where I act as the Membership Director). They are leveraging the buying power of multiple Chambers and associations and their members to get great deals for Chamber members.

Before you ask, no, our Chamber isn't making any money from this partnership. Our goal is to create real benefits for our members that will lead to more businesses wanting to join the Chamber (thus increasing membership sales).

The  more Chambers that get involved, the bigger the negotiating power will be and the greater the benefits/savings participating Chambers can offer their members.

There isn't any good reason Chambers shouldn't join forces and create a real savings/discounts platform that's filled with great offers from recognizable (and trusted) brands. 

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What do you think? Is this something your Chamber would be interested in? Have you seen platforms like this before and if so, what has been your experience with them?

Creating & Evaluating Member Benefits

This post is part of an ongoing series on Chamber of Commerce leadership, organization, and membership. The posts are intended for Chamber staff but anyone who works in a membership organization can apply the concepts.

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Member Benefits

A constant discussion among membership organizations is the right number of member benefits. Are more benefits better? Less benefits? Should weaker benefits be eliminated?

There aren't any easy answers to these important questions. And because each Chamber is different, the number and type of member benefits will vary.

Since there is such a diversity in the type/number of member benefits, Chambers should be more concerned with a process of member benefit creation and evaluation. If there is a solid process, then the appropriate number and type of member benefits will emerge.

Defining a Member Benefit

What is a member benefit?

It's a solution to a member need. For example, members come to the Chamber with the desire to expand their professional network. They want/need to make more professional connections. To satisfy that need, the Chamber organizes networking events.

Member benefits are the lifeblood of Chambers (and other membership organizations). And because they play such an important role, it's critical that Chambers use a process to ensure the quality of those benefits.

Here is a 4 step process to create and evaluate member benefits. 

4 Steps Process to Create & Evaluate Member Benefits

Step 1: Create

The first step is coming up with an idea for a benefit. Maybe it comes from Chamber staff or directly from the members. Maybe you'll be approached by companies with partnership ideas for new member benefits.

But tread carefully, always make sure that the benefit is really a solution to a member need. You'll recognize a need when multiple members start asking for help with a certain aspect of their business or asking if your Chamber sells a certain product/service. 

For example, suppose a number of members asked if they can promote their events on your online events calendar. Since your events calendar is probably just for Chamber events, you might say no. But, you might also realize that if enough members are asking for this, it could indicate a need that the Chamber could solve with a member benefit (i.e. creating a community calendar). Proceed to step 2.

Step 2: Implement

The second step is taking the idea and evaluating/gathering the resources to implement it. This step starts with questions and ends with action. Here are some questions you can ask yourself before implementing the benefit:

• Complexity of implementation?
• Costs associated with implementation? (staff time, money, energy)
• Projected members served?
• Ongoing maintenance (cost, time, energy) of benefit?
• Can the benefit be self-service (i.e. not require staff time/energy once implemented)?
• Can the Chamber provide this benefit better than anyone else in the Community?

Consider these questions a quick cost/benefit analysis for your suggested member benefit. By doing some basic due diligence, you can weed out the losers and focus your attention on the benefits that have real potential.

Building on the community calendar example in Step 1 above, it is probably simple to implement a new community calendar on your website. Ask your web manager to give you a quick estimate on cost. The projected members served could be quite large, since members have their own events all the time. Ongoing maintenance is a tricky one. Many online calendars are not self-service. This means that every time someone wanted to add a new event to the calendar, you would need to manually input the event information. This may raise a red flag. Finally, it's worth a quick web search to research other event calendars for your community. Is this a resource the Chamber can provide that will be better than the other event calendars in your community. Or will it just be buried on your Chamber website? 

These are the sort of questions your staff must evaluate before fully implementing the new benefit. In the final analysis, you'll know whether or not to implement the benefit. 

Step 3: Promote

Three words: communicate, communicate, communicate. No one cares about benefits they don't know about.

The Chamber must communicate two things: (1) the benefit and; (2) how to use it. Do they need to contact a specific staff member? Create an account? Call an account rep?  

Whether you do this through email, direct mail, phone or in person, communicating the benefits available and how to use them will make or break your offering of benefits.

Step 4: Evaluate

Constant evaluation is essential to member benefit relevancy. Still think your members gain tons of value from a "business listing" on your website? Think again.

It's almost sacrosanct to eliminate a benefit and thus, the list of member benefits just keeps growing. But guess what? It's OK to eliminate member benefits. It's better to eliminate weak benefits if it creates more resouces to focus on the stronger ones.

Some questions to consider when evaluating a benefit (similar to the questions you ask before implementing a new member benefit):

• What member need does this benefit serve?
• Approximate number of members served?
• Ongoing costs associated with the benefit? (staff time, money, energy)
• Can the Chamber provide this benefit better than anyone else in the community?
• Approximate value of this benefit to members?
• Would anyone notice if the benefit was eliminated?

For many Chambers, Step 4 should be the first step in the process. There already have a list of members benefits that hasn't been evaluated for months (or even years). Evaluating each benefit one by one will shed light on benefits that need to be enhanced, changed or eliminated.

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Thoughts? Does your Chamber use a process to routinely evaluate member benefits and their relevance?

How many members do you have? (Hint: the answer isn't that important)

This post is part of an ongoing series on Chamber of Commerce leadership, organization, and membership. The posts are intended for Chamber staff but anyone who works in a membership organization can apply the concepts.

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How many members do you have?

After attending the annual WACE Conference (a conference for Chamber Executives), I was reminded of the typical question Chamber Execs routinely ask each other every year to gage their own Chamber's performance. That questions is "how many members to you have?"

The problem with this question is that the answer is relatively unimportant (other than a general barometer of Chamber size). Sure, in a membership organization like a Chamber of Commerce one piece of data is the number of members.  

But does the number of members really give a Chamber a good sense of the strength of its organization? I think not. Wouldn't a Chamber rather have 500 committed members instead of 750 apathetic ones? Without a doubt. 

Instead of focusing on the number of members, Chambers should focus on the value (i.e. quality) of those members. Sure, more is typically better in membership organizations. But quality is much more important than quantity.

So what question(s) should Chambers be asking about the value of their members?

Here are a couple suggestions:

• [Participation] How many members participate in events? Committees? Volunteering?
• [Financial] What is your lowest and highest membership fee? Lifetime value of a member?
• [Promotion/Referrals] How many referrals does your Chamber get from members?
• [Brand Recognition] Do well known and respected businesses join the Chamber?
• [Loyalty] What is your retention rate?
• [Feedback] How many members routinely give you feedback? Suggestions for improvement?
• [Communication] How many members receive, open, and engage with your communications?

These questions are just a starting point for a more meaningful discussion about Chamber membership and the value of members (instead of just the number).

Hopefully next time you run into other Chamber Execs, you'll think twice about how many members they have and instead inquire about the quality of their members.

Thoughts? What questions do you think Chambers should be asking each other to assess the value of their membership?

Non-Dues Revenue is for Non-Chambers

This post is part of an ongoing series on Chamber of Commerce leadership, organization, and membership. The posts are intended for Chamber staff but anyone who works in a membership organization can apply the concepts.

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Non-Dues Revenue

A topic that floats around Chamber of Commerce circles is non-dues revenue. Most Chambers are strapped for cash and the prospect of finding an alternate revenue stream (other than membership dues) is appealing.

Chamber staff members whisper stories about that one Chamber that made $30k from a trip to China in non-dues revenue. And if a Chamber has had success with non-dues revenue sources, more power to them.

But in my experience, these stories are the exception, not the rule. Far more likely is a Chamber uses significant staff time, energy, and resources to implement and promote a program that only yields tens or hundreds of dollars over the course of a year.

Here are a few examples of the most popular non-dues revenue opportunities for Chambers:

• Travel programs (earning a commission on each trip sold) - approximately $200 per trip.
  
• Affinity programs (earning a commission on the sale of Office Depot or other products) - approx. 10% - 35%
  
• Resale programs (earning a commission on the sale of labor law posters) - approx. 10%  - 35%
  

The Issue with Non-Dues Revenue

The problem with pursing non-dues revenue is that it's time/resources/money spent pursuing a non-critical competency of the Chamber. Is a Chamber of Commerce in the business of selling trips? Office products? Labor law posters?

Absolutely Not. A Chamber is in the business of selling memberships (and anything that supports that critcial competency). For most Chambers, membership revenue makes up 60% or more of the total Chamber revenue.   

Lack of focus

A common pitfall I've witnessed in a number of Chambers is a lack of focus. Chambers engage in event planning (networking, etc.), advocacy, educational workshops, marketing, and a number of other activities.

And part of this diversity of activities is the very nature of a Chamber - Chamber's serve their members in numerous different ways. But at what point are Chambers overextending themselves and operating in a segment that's too far away from the true focus (i.e. core competency) of the organization?

Speaking at an investors conference this week, Tim Cook, the current CEO of Apple said the current Apple TV business is a "hobby," but "Apple doesn't do hobbies as a general rule. We believe in focus. And only working on a few things." [Emphasis added]

Taking Tim Cook's advice to heart would do Chamber's well. Chambers need to focus on membership dues first and foremost.

A different approach

Instead of looking for more ways for the Chamber to "make more money" from non-dues revenue, what if Chambers looked for ways to strengthen current member benefits? Or if Chambers added new valuable benefits?

The stronger the membership benefits are, the more likely it is that businesses will join Chamber, refer the Chamber, and support the Chamber financially through it's strongest value proposition (membership dues).

If the Chamber is struggling financially, it isn't time to call in the non-dues generators, it's time to refocus on why dues (i.e. people paying for benefits) aren't covering Chamber expenses.

Bottom line

Non-dues revenue is best left to non-Chambers. Chambers should be focused on dues revenue (by providing valuable member benefits).

Warren Buffett on Business

Here is a great video of Warren Buffett answering questions from a group of MBA students. He uses Coca-Cola as an example throughout the presentation as a great business with the characteristics he looks for in an investment.

Interestingly, he says that people don't get cola fatigue. Meaning that it is natural to get tired of eating and drinking foods and liquids with the same taste. While people may get tired of drinking root beer or other flavored drinks, they do not with cola. This phenomenon is what enables people to drink five cokes a day and then do the same the next day. I'd be curious to know if that's actually true.

The video is about 128 minutes, but well worth watching in its entirety. Here it is:

Disconnected Customer Service

I stopped by my local grocery store today. Only purchasing a few items, I was somewhat surprised when the cashier asked me if I needed help out to my car.

"No. Why would I?"

"Oh, it's just a policy we have. We asked everyone if they need help out to their car."

"Hmm. That's odd."

"Yea, I know."

Needless to say, there was an obvious disconnect between the reality of my situation (i.e. a 28 year old male buying just a few light-weight items) and being asked if I needed assistance out to my car. Sure, if I was 85 years old and had purchased a large quantity of heavy items, I would love the help. But that wasn't the case. Hence the disconnect.

As opposed to treating me like an individual, this store mandated a policy which clearly didn't apply. Thus, an opportunity for truly good customer service was lost.

Instead, what might have happened if the cashier was more concerned about just saying hello and being pleasant to me? Or simply asking how my day was going? I know I would have appreciated that gesture more than being asked if I needed assistance to my car.

Maybe good customer service can be better achieved by allowing employees to serve the unique and specific needs of customers, as opposed to mandating specific actions? Just a thought.

What do you think?

Results-Only Work Environment (ROWE)

Every time I hear about a manager who berates an employee for arriving a few minutes "late", I cringe. Are we still in grade school?

Sure, there are a few jobs that require strict hours. But the majority of information workers can work from anywhere at any time. So why insist that people show up at 9am and leave at 5pm?  

Lucky for corporate America, a few trailblazers that have taken the leap, and changed their human resource strategy. There's even a name for the new strategy: Results-Only Work Environment (ROWE).

Tim Ferriss has a nice piece about ROWE here, and in particular, how the folks at Best Buy created/adopted it. Also, Dan Pink has a related TED talk about employee motivation. The bottom line is that the focus is on results, not time. 

Who cares if someone doesn't come in until 10am if they're producing outstanding results? I certainly don't.

Interviewing for Initiative

How can you tell if someone has initiative in an interview? Can you learn about someone's initiative through questions, their resume, or brain teasers? 

I've been doing quite a bit of interviewing in the past week. This is because I'm looking for one, possibly two new interns to help me out at work. A couple of things I have noticed and/or taken away from the interview process:

1. Most people don't take the time to research what your company/organization actually does. This is sad. More than half of the first group of people I interviewed couldn't give me a coherent answer to the question, "So what do we do?" Bottom line - if you are a candidate, do your research. This will help you stand out from the plethora of others who don't.
2. Enthusiasm speaks volumes. Put simply, I don't want to be around someone who is a debbie- downer. Why come into an interview and talk about how tired, sad, bored, victimized you are? Just don't do it. People want to work with (and do business with) people they like and want to be around.
3. Initiative is hard to determine in a first meeting. You don't really know how someone is going to perform until they start working.
4. Don't drag out an interview if it's obviously the wrong fit. If it's clear in the first 5 - 10 minutes that someone isn't a good fit, I thank them for their time and ask them to leave. Why waste either person's time?
5. Get a second opinion. I always ask another coworker to interview the potential employee. This is especially true if you are a small team. Small teams wear many hats. Make sure everyone is comfortable with the new teammate before you bring him/her on board.
6. You get what you pay for. More often than not, people who can command a larger salary/wage will do so. If you're offering a minimal salary/wage, don't expect superstars.
7. Brain teasers are a waste of time. Yes, you want to know if someone can think analytically, but asking how someone would move a mountain is a monumental waste of time. That being said, I have run into a fair amount of interesting interview questions over the years. 

What about you? Have you devised any tips/tricks to help you conduct efficient, yet meaningful interviews?

How to Effectively Manage Expectations

Tonight was the tenth "Start-ups Uncensored" town hall hosted by Jason Nazar, CEO and co-founder of Docstoc.com. The talk focused on legal issues facing entrepreneurs and included guests John Suh, CEO of LegalZoom, and David Young, partner at DLA Piper. 

A concern that kept surfacing throughout the talk was the (sometimes exorbitant) size of legal fees. How does an entrepreneur who is boot-strapping his/her new business afford the services of a lawyer who charges $400/hr and has every incentive to maximize billable hours?

The simple answer - by managing expectations.

Managing expectations is a simple, yet powerful solution. When you hire a lawyer, enter a business relationship, or even a personal relationship, both parties have certain expectations. They hope to gain something from the relationship.  

Unfortunately, instead of communicating the specifics of the relationship desired, many people "hope" that the other party acts according to their wishes. As a result, the expectations of each party are neither known nor valued.

A better method, espoused by all participants in the talk tonight, is to err on the side of too much communication. Spell out everything you are looking for, the terms of the agreement, the circumstances of your relationship, and/or what you are hoping to gain. 

For example, suppose you need to hire a lawyer. Take the time to thoroughly explain the issue you need help resolving, ask the lawyer his/her hourly rate, and how many hours it will take to complete. Then, agree upon a certain quota of hours the lawyer will work and explain that before the lawyer exceeds the agreed upon quota of hours, he/she will check with you. 

By taking the somewhat uncomfortable steps of spelling out the expectations in the relationship, you minimize the probability of a misunderstanding after the fact. 

How to Lead Effective Office Meetings

Does your organization have a meeting culture? When a complicated task or issue arises, is your first thought, let's set up a meeting?

Meetings can be great. But more often than not, they're just a form of organizational procrastination. Instead of taking action on a problem/issue right now, you schedule a meeting for a couple of days from now, or even two weeks in the future. 

The question is, why is the first instinct to "set up a meeting"?

Why People Love Meetings

As odd as it may sound, I know people that get visibly excited about scheduling meetings. Here are my theories as to why "meeters" love to meet:

• Scheduling a meeting allows you to postpone a decision 
• It's a mini-vacation - you get to leave your office and communicate with other human beings for a change (as opposed to staring at a screen)      
• Meeting makers in Outlook are kinda fun to send - they're like the office version of an evite
• Brainstorming gives people the opportunity to flex their creative skills  
• Meetings provide an opportunity show thought-leadership and talk about the "big picture" 
• Telling people (or making people call you back because) you have a meeting makes you sound important  

I'm only half kidding.  If I had a nickel for every time someone suggested we "set up a meeting" to discuss an issue that could be resolved right then...

Let's assume you really do need to set up a meeting. In order to make sure you make the most of your time (as well as the other attendees), you should avoid these common pitfalls.

Common Problems with Office Meetings

Organizations that have given little thought to their meetings typically show symptoms of one or more of these common office meeting pitfalls.

• Lack of clarity of purpose 
• Attendees arrive unprepared or tardy  
• Meeting has ambiguous or unstructured format 
• Meeting organizer does not faciliate discussion  
• People shirk accountability for action after the meeting is over      

This list could be much longer. These are just the most common pitfalls that I've witnessed.

The point of all this is to recognize two things. First, a meeting might not be the best solution. Second, if you are going to hold a meeting, take the necessary steps to create an effective meeting. Here are some tips to help you organize effective meetings.

Framework for Effective Meetings

Here are some thoughts on how to structure more effective meetings.

• Clarify the purpose of the meeting before you schedule it - does a decision need to be made? brainstorming? task delegation? Can the issue be solved with a quick in-person chat or by email? If so, skip the meeting.
• Only allot as much time as the topic deserves - just because Outlook schedules in 30 minute time blocks doesn't mean your meeting should last 30 minutes (try a 5 or 10 minute meeting).  
• Designate a meeting organizer/leader. The organizer is in charge of sending out an email at least 3 hours before the meeting with the agenda and preparation required by attendees.    
• If someone comes late, ask them to leave.  If someone comes unprepared, ask them to leave.     
• Within 30 minutes of the end of the meeting, the meeting organizer must email a short meeting wrap-up with a meeting summary and next steps.

While these tips won't guarantee a perfect meeting, they will certainly help shift attitudes about what a meeting means for your organization.