Over the last year, I noticed an alarming trend popping up in my interviews with CEOs on my podcast, Associations Thrive. CEOs in the healthcare space were worried about nurses and technicians leaving the industry. Michael DiFrisco, Executive Director of the American Academy of Cosmetic Dentistry, surveyed members and found that 52% of accredited members were planning to retire in the next five years. Kelli Baxter, then Executive Director of the American Translators Association, surveyed members and found that 62% of members were close to retirement! I could go on and on.
I realized that many (granted, not all) associations are facing a membership cliff in the coming years. And this cliff is not just a distant concern – it’s here. What’s contributing to this cliff and what are associations doing to combat this cliff?
To explore this more, I hosted a webinar through UST Education on the membership cliff. I was joined by Michael DiFrisco of AACD, and Tracey Moorhead, CEO of the American Association of Post-Acute Care Nursing. Here’s what we learned:
Demographic Shifts are Accelerating
Demographics are playing a significant role in shaping membership trends. These shifts mean fewer professionals are entering industries and, by extension, associations.
- Baby Boomers retiring: With this generation leaving the workforce in record numbers, their participation in associations is waning.
- Gen X retiring earlier: The pandemic has prompted some Gen Xers to exit the workforce sooner than expected.
- Fewer younger professionals: Low birth rates and political resistance to immigration have created a smaller pipeline of potential members.
Membership Models Are Under Strain
The traditional membership model is facing scrutiny. There’s a lot of hand-wringing about Millennials and Gen Zers who are not “joiners.”
- Low student-to-professional conversion: Many associations struggle to transition discounted or student members to full membership.
- Perceived value gap: Younger professionals often question the ROI of membership, believing they can access similar resources online for free.
- Competition from for-profit offerings: Private companies are creating compelling, alternative benefits tailored to niche needs.
- A la carte preferences: Members are gravitating toward customizable and flexible benefits rather than one-size-fits-all membership models.
The Private Equity Impact
Private equity is reshaping industries, often at the expense of associations. This trend surprised me the most. Once private equity was mentioned during the webinar, the chat lit up. It seems private equity is impacting industries in a HUGE way.
- Reduced memberships: Mergers and acquisitions result in fewer independent companies, shrinking the pool of potential members.
- Less investment in associations: Private equity firms frequently provide internal training, certifications, and resources, diminishing the perceived need for association offerings.
- Staff reductions: When private equity acquires firms, workforce cuts often follow, reducing the number of individual members.
Strategies for Mitigating the Membership Cliff
So how are associations addressing membership challenges and declines? We had nearly 100 people in the webinar and the chat was going crazy with insights and comments! Many execs realized that they are not alone in facing a looming cliff, many realized the need to survey their members about demographic trends, and many shared the strategies they’re exploring and executing. Here are my notes from the chat:
1. Associations Are Learning to Make Data-Driven Decisions
- Analyze demographic and membership trends.
- Share insights with boards and leadership to align strategies.
- Monitor competition and member needs to stay ahead.
2. Associations Are Experimenting with New and Different Membership Models
- Experiment with subscription-based or incremental pricing.
- Pilot “free membership with paid events” models to attract new participants.
- Offer flexible, tiered options tailored to varying member needs.
3. Associations are Refining Their Value Proposition, Especially to Different Audiences
- Highlight exclusive benefits like certifications, networking, and education.
- Craft offerings that resonate with different demographics—young professionals, mid-career changers, or retirees.
4. Associations are Connecting Members to Deepen Engagement
- Launch mentorship programs to bridge generations and foster loyalty.
- Invest in localized and hybrid networking opportunities to meet members where they are.
5. Associations are Building Strategic Partnerships
- Collaborate with private equity firms to underscore the value of associations.
- Partner with universities, corporations, and other nonprofits to develop pipelines for new members.
- Co-develop educational events and certifications with industry leaders.
Facing the Future with Confidence
The membership cliff may be imminent, but it’s not inevitable. Associations have the opportunity to adapt, innovate, and reassert their value. How are you navigating the membership cliff? What strategies is your organization exploring to safeguard its future?