Recently I chose to participate in a committee of Aurora Association of REALTORS® board members. The committee's purpose was to gather ideas on how the Association can meet growing financial obligations without raising dues to current REALTOR® and Affiliate members.
Challenges to face
As one would expect, our membership numbers from the REALTOR® community have gone down in recent years. Affiliate memberships have declined as well. Prior AAR boards have worked hard at cutting expenses. Staff members have played their part by taking cuts in benefits and/or salaries. Previously permanent positions have been outsourced to independent contractors. Recent position vacancies have not been filled.
In our current economy, consumers – including our members – have multiple choices about where they purchase services and products and from whom. The bottom line is that the market has changed and so have the needs of our members.
The following are ideas from the committee on areas from which non-dues revenue can be generated. We'd love to get your opinion on any of these or others that come to mind.
Advertising. In addition to print publications, associations have created advertising opportunities in their e-newsletters and online publications. Our e-newsletter carries some advertising. Should we encourage more advertising? Is there the potential to offer the affiliates the possibility to "purchase" more lead generation opportunities?
Facility rental. For associations that own property, renting out conference centers, meeting rooms, or other office spaces can bring in significant revenue. Some associations have built-in state of the art conference and training facilities for just this purpose. Associations with technology education centers have attracted students from neighboring boards to their hands-on classes. Associations that own their own small office buildings often designate an amount of rental office space that pays for building maintenance and taxes. How do we get more rental activity, especially on weekdays; can it be balanced with training offerings? Our CEO Carol Reed has pointed out that rentals for weekend social events have been steady. Should we consider raising rental rates? Our single most valuable asset, outside of our members, is our building. How can we maximize its profitability?
Mailing list rental. Vendors, researchers, and allied industry professionals all want to get their message to our members. This makes our membership list a valuable piece of data. Renting member mailing lists can provide a steady revenue stream, but we must make sure that strict controls are placed on the list's use. Should we consider this as a viable option?
Education. Offering classes is a long-standing revenue-generating practice for associations. The variety, size, cost, and type of classes can range widely. Virtual and correspondence classes are becoming more popular as state licensing agencies approve the use of the Internet in continuing education. We could try marketing educational programs to members with incentives, package deals, and discounts. Some promotional strategies to attract new students include offering flat-fee annual education passes and targeting class offerings at practitioners who specialize, such as in commercial or property management. What if we offered educational opportunities to people outside of the real estate community?
Affinity programs. A popular strategy among associations is to collect revenue by permitting companies such as wireless phone providers to market directly to members in return for a special rate or program. These partnerships with service providers and product vendors can offer associations great returns, often with little effort. The key to profitable affinity programs is to support programs that the members want.
REALTOR® Store. REALTORS® are consumers of products. Associations such as ours have long acted as distributors of products necessary to do the day-to-day business of real estate. Promotions are always considered a way to stimulate sales and improve profit. Point of sale (POS) software has been proposed as a means to lower our labor cost in our REALTOR® Store. Outsourcing our offering to a retailer associated with our type of business has also been discussed. The bottom line is that our members are spending money every day – so how can we increase our share of that pie?
Henry Ford once said "Don't find fault, find a remedy." We encourage your input into these and other association discussions.