The Real Threat that For Profits Challengers Have for Associations

Tony Rossell, a very smart marketer, posted recently about for-profit companies competing with association. He raises some good points.

The root of the threat from for-profits is not so much that they will eat the associations’ lunch but that they will offer full meals that the association can’t serve to their own members.

Many organization are not very nimble for a whole variety of reasons: inertia, history, policy, politics, poor leadership, sclerotic decision making, and others. For-profits, especially start-ups, are less likely to have that same baggage. For-profits also need to show a profit in short order, which tends to motivate them to try new things until they find the right mix with which to generate their desired returns.

Given that, if I were going to start a for-profit targeted at an association’s existing market I would focus purely on the innovation space, providing valuable goods and services that market can’t get from their membership organization. New, high-value, services can demand higher fees and you avoid a direct challenge to the association’s core space.

My challenge to associations: seize that innovation space before someone takes it from you.

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