Your business is running smoothly. It’s well respected in the marketplace. Things are good.
So, why would you make a significant change in the way you do business? Why would you adjust your price structure and change your revenue stream? The only reason you would do that is because it was important to your customers, it benefited them, and because it improved your long-term viability.
Click play above to hear from Vice President of Membership, Mark Field, about tiered benefits.
That is exactly what the Knoxville Chamber is doing.
After careful consideration by the board of directors, the organization is making a substantial shift in the way that members will invest. Businesses will no longer join based on the number of employees they have, but will instead choose the amounts and types of benefits they want and need, and invest accordingly.
“Chamber members will be able to shop for the benefits that make sense to them,” says Mark Field, the Chamber’s vice president of membership. “Members will no longer be ‘penalized’ for growing, expanding, or acquiring another business, since the number of employees no longer has an impact on the amount of investment. The staff and the board listened to the desires of the membership and the new dues structure reflects the desire for new benefits and choices.”
A national trend
The Knoxville Chamber isn’t the first to adopt a system that includes tiers of benefits. In fact, for the past decade chambers of commerce across the United States have looked for ways to deliver customizable packages of benefits to their members. But all along, this has been a member-driven phenomenon.
The first system of benefit levels developed when big national banks were consolidating, and their total deposits were dramatically increasing. Therefore, their required investment in various chambers of commerce was increasing too – because it was based on the number of employees or deposits.
But the amount and level of benefits offered to these banks were not increasing. The increased investment was not being matched by an increase in benefits. This system didn’t seem fair to businesses, and it wasn’t.
The solution was to develop levels of benefit that did match investment, and that provided an equitable return on investment.
That’s what tiered benefits systems are all about.
Careful consideration and a measured decision
“In the past, I’ve had some members approach me and share their frustrations with the employee-based dues structure,” says Field. “For example, a business with 1,000 employees that invested $5,000 annually in the Chamber did not understand why a member with three employees received the exact same benefits. I didn’t have a good answer for them.
“Here’s another story. A company that had been a Chamber member for 50 years recently approached me. The company’s market had shifted and while the business wanted to remain a Chamber member and asked to reduce its investment in the Chamber while it adjusted to new markets. Under the old system, and based on the number of employees at the company, that was impossible. I had to turn this long-standing member away from the Chamber and I had to turn down this company’s money. That’s how silly and inflexible the employee-based membership system can be.”
The Knoxville Chamber began considering making the change to a different membership structure in 2006. For nearly two years the staff and the board critically looked at the potential and studied the effects the change would have on the organization and the membership.
A national consultant was engaged to help the Chamber make the decision. Dawn Moliterno has helped dozens of chambers of commerce look at a tiered membership system. She is able to recognize some of the pitfalls of the conversion and identify the reasons a chamber should or should not make the change.
Part of Moliterno’s process included the facilitation of focus groups with a broad cross section of Chamber members. These meetings were designed to determine the amount of satisfaction with the current membership structure and to identify areas of need that the Chamber could, but was not, addressing. These areas could become new member benefits.
“While the goal of the focus groups was to determine if members wanted a different system where benefits were aligned with investment levels, we learned a lot more,” says Melissa Spangler, director of member services. “We were able to identify areas where the Chamber could do more to meet members’ needs.”
In the end, Moliterno recommended that the Knoxville Chamber transition to a tiered benefits model. However, she didn’t make that recommendation lightly. She challenged the staff to identify new benefits at each and every level of membership.
“After all, the Knoxville Chamber is a membership organization,” says Field. “We only wanted to move to this tiered benefit structure if it met the needs and desires of the membership. And that required the staff to identify new and expanded benefits that matched what we heard in the focus groups.”
Among these new benefits are more visibility for members, improvements to the Chamber’s website, and the better delivery of information.
The tiered benefit structure that Moliterno and the Chamber staff developed begins with five levels and progresses all the way through the Premier Partner Program. As the tiers progress, the benefits increase.
The transition to tiered benefits
Adopting the tiered benefits system is a significant change for Chamber members. While the staff and the board of directors have examined the system for two years, the concept is new for members. So, the transition to the system will be paced and will allow plenty of time for adjustment.
Current Chamber members will be “slotted” into the tier that approximates their current investment in the Chamber.
However, no Chamber member will be asked to pay more in that first year. For example, if a member currently pays $319 in membership dues, the business will be assigned as an Associate I member, but will not be required to pay $350 in that first year. The member will receive all the benefits associated with their assigned level of benefits.
“The slow transition will allow Chamber members to become comfortable with the change,” says Field. “The staff also recognizes that there may be a need to add even more benefits to all the levels – benefits that we haven’t even considered. And we want to allow time to identify those and place them in the appropriate level.”
The staff is committed to continuing the process of regularly examining member benefits and adding new benefits. You are encouraged to take advantage of this new opportunity by reviewing the new tier benefit levels and maximizing your membership benefits. If you have any questions, please call Mark Field or Melissa Spangler at 865-637-4550.
