Building Partnerships With Your Industry’s Trade Associations
Trade associations are interesting because they are founded and funded by the businesses that operate in that industry. In my opinion, that makes them highly questionable from an informational perspective. Nevertheless, they are a huge business.
Take the International Council of Shopping Centers (ICSC), for example. According to Cause IQ, it had revenue of $80.3 million in revenue and is holding $140 million in assets. That’s with fewer than 200 employees and a CEO that makes $2 million a year.
That’s an interesting business to be in considering it’s also a non-profit.
But where does all of that money come from? If we dig into the 2018 tax return, there are four line items:
- $13.9 million in membership dues
- $636,000 in professional recognition
- $2.4 million in advertising
- $55 million in conventions and meetings & conferences (these are two line items, but I merged them)
None of this should be surprising, of course. Trade associations are the primary way that people that work within an industry can meet each other and network. It’s really very chummy.
As you can imagine, though, with Covid hitting, these trade associations are likely hurting quite a bit because they’re missing out on all of that convention and conference revenue. It’s clearly a major business for these associations.
What’s interesting is that ICSC is pretty unique in that it actually earns a decent amount of money from its advertising business. Many of the trade association tax returns that I looked at showed no advertising revenue. It’s all membership and events.
That got me thinking… Why aren’t more of these associations trying to generate advertising revenue? It would seem to me that one of the easiest things they could do is launch a newsletter, hire someone to build it and generate a decent return on that investment.
So, I started digging and found my way to SmartBrief. Acquired by Future Plc in 2019, SmartBrief is a newsletter company whose primary business is building newsletters for trade associations. According to its homepage, SmartBrief creates 275 newsletters across 14 different industries.
The model is actually very straight forward… Trade associations are not built to create consistent editorial content. So, SmartBrief comes along and partners with the trade association to create branded newsletters. In exchange for accessto the trade association’s membership lists, the association earn anywhere from 10-25% of the advertising revenue.
It’s a bit of a risky business for SmartBrief to be in since it appears that none of the audience is owned. However, it’s been around for 20 years and it doesn’t appear that the trade associations are suddenly waking up and realizing that they could likely earn far more money by doing it on their own.
This relationship has worked for SmartBrief. According to Flashes & Flames, SmartBrief did $35.1m in revenue in the year ended March 2019 with EBITDA of $5m.
According to an NPR story from 2011:
Over the years, the number of associations has grown. By 2010, according to the ASAE, once known as the American Society for Association Executives — an association for associations — there were more than 92,000 trade and professional associations in this country.
In 2010 Carroll wrote that many of the trade groups “remain stuck in a rut of complacency. They deliver the same old program. They focus on the same old issues, generate the same old knowledge, plan the same old conference, and have their agenda managed by the same old membership has-beens.
All of this brings me to the main question I have for this piece: for B2B publishers, is there a way to partner with trade associations in a way that either brings us more known audience and/or generate more revenue?
I have some ideas…
Creating product with trade associations
At the core of any relationship with a trade association is an understanding that both bring certain things to the table.
In the case of SmartBrief, and likely in many other cases, it’s the media company bringing content and sales while the trade association brings audience. The important thing to remember is that marketing budgets follow audience. If you can ensure an engaged audience with great content, there’s an opportunity here.
The goal with this strategy is simple. Trade associations have paying members, which is your target audience. You want to find a way to get that audience onto your platform and keep them there.
The important point is that this shouldn’t feel like a rented relationship. The audience needs to wind up in your system. You need to have a direct relationship with them. Otherwise, it’s a traffic play and that doesn’t help long-term.
As the trade association and media company for that particular industry, there is a unique opportunity to create a co-branded report. The topic can be whatever is unique to your industry.
I think back to some of the tent-pole projects that I talked about a couple of weeks ago. The goal is to create something particularly impactful that people are going to want to engage with. A few ideas I’ve thought of are:
- A salary report broken down by job function and seniority
- An R&D report that shows which companies are investing the most
- A report on the state of Washington’s stance on the industry
I think you get the picture… This is the type of content that would do really well both with the audience and the press.
The trade association can be responsible for driving the audience engagement—again, they’ve got the members—and the media company is responsible for creating the content and packaging it up.
Once the report is ready to go, put it behind a simple lead gen wall on your site. In my opinion, this is the most important part of this entire exercise. If the content is on the trade association’s website, you’ve got to deal with transferring user data. Additionally, the user might not anticipate receiving emails from you because they signed up on a different site.
Cover their event
Everything has moved virtual. The trade booths that expos made a ton of money on are no longer there. That’s obviously going to hurt these associations.
The goal here is to help them execute on a digital product that their trade show sponsors feel comfortable with. I think the simplest way to do that is to package up great content about that specific event. It’s likely that your journalists were already going to be watching, so this would just be creating a unique package of that content.
A couple ideas that come to mind:
- An end of day video recap where you discuss the main talking points
- A daily popup newsletter covering each day of the event
For your regular coverage, you’d still publish it on your site like you normally would. That’s just standard business. However, you take it one step farther to create something unique for the association.
If it’s a video recap or newsletter and there’s a sponsor, that means you need to talk directly with that sponsor. Now the association’s sponsor is your business contact.
Additionally, when the content is distributed to the association’s audience, it includes your branding in it, which only helps you with audience development.
Pay for leads
This final one is pretty straight forward, so I won’t beat it to death.
In some cases, your trade association could be the extra firepower you need to ensure that a sponsor’s asset gets the appropriate amount of exposure.
Let’s say you’re doing a webinar for a sponsor and you guarantee 250 qualified leads. A few days before the event, you realize you’re at 200. In exchange for some cash, the association could send out a marketing email on your behalf to their audience.
Having these relationships set up in case your sponsored opportunities fall short is important. Ideally, you’re never leaning on it because that reduces your margins. But, it’s better to deliver what the sponsor wants than to come up short.
A few quick reminders about associations
It’s important to remember a few things about working with trade associations.
First, they are technically competitors in a loose sense. It’s likely you’re both trying to get reader revenue (memberships/subs), event revenue (tradeshows/virtual events/etc.) and both trying to get advertising revenue (sponsors/ads/etc.).
However, I’ve often been of the belief that cooperation with your competition can be a great way to build. Coopetition as some call it can benefit both sides in a mutualistic sense.
Second, they are not media companies, which means they do not have a journalistic code of ethics that they live by. They are funded by the same companies that are in the industry, so they are inherently biased toward positivity.
Third, use these tactics sparingly. Independence is fundamental to a successful media company. As with everything, if you overuse a strategy, it’ll loose its efficacy. Consider this as one tool in your audience development and sales toolbox, but not the only tool.
So long as you remember these, there are good opportunities to potentially work with your industry’s trade association. They’ve got a related audience, they have companies that are used to spending money with them and they have no idea how to build digital products.
If you can help, there’s likely new audience and revenue waiting.