The Cost of Innovation: Champagne Tastes But a Beer Pocketbook?
“Innovation” is a buzzword tossed around a lot, especially at the beginning of the year. But talking about innovation and actually engaging in it are two distinct things.
ASAE defines innovation as “an original program, product, service, or process that adds value.” That value could manifest itself in the form of membership value, added efficacy to staff processes, or improvements to the way products and services are created or delivered within an industry.
Few would argue that innovation is a positive – and needed – practice for industries that want to grow and for a society that wants to improve its quality of life. Innovating is held in such high regard that Gartner estimates that the average chief marketing officer spends $1 out of every $6 in their annual budgets for innovation, even when they aren’t sure they’ll see results from it.
But that type of price tag and, more importantly, that type of perspective on the value of innovation shouldn’t be a main factor in association’s pursuit of new ways of thinking, seeing and doing. Yes, the cost of innovation can be large, but results often aren’t dependent upon the size of the financial investment. Consider that Airbnb started as one household renting out their loft as a way to make extra money. Or that Coca-Cola spent hundreds of thousands of dollars developing and introducing New Coke. Those two innovation stories produced results disproportionately opposite of their initial investments.
“Rather than think of innovation only as large, shiny new projects, think of it as any change that moves the needle toward your goals,” writes Michael Tatonetti of the Professional Pricing Society for Association Success. Take his line of thinking one step further, and recognize that some changes don’t require a lot of money.
With that in mind, we present a few innovation options that could cost a significant portion of your association’s marketing budget, as well as options that take a more budget-friendly approach to the same goal. Think of this list as innovation for those with champagne tastes but beer pocketbooks:
Champagne: Revamping your marketing tech stack to include artificial intelligence and machine learning.
Innovation could mean many things to many organizations, but it’s probably safe to say that it often means investing in technology. According to Gartner’s CMO Spend Survey 2018-2019, in 2018, marketing teams spent an average 29% of their budget on MarTech. Within that area, they spent money on:
- External services to develop, implement and integrate marketing applications.
- Cross-charges from internal IT.
- Infrastructure for marketing technology.
- On-premise marketing and/or analytics software applications.
- Marketing and/or analytics software as a service.
AI and machine learning platforms can transform the way your association views its member data and plans for future initiatives, but there are plenty of free and low-cost analytics programs that will also provide useful information about how to run your association. The catch is that you usually must have a staff person who knows how to use those platforms and whose job is dedicated to sifting through such data.
Beer: Use technology you already have, but in a different way.
The Professional Pricing Society wanted to offer members more online courses and get them to log into the association’s member portal more often. Instead of creating a whole new curriculum that would require a sizeable outlay of money and staff time (or a paid consultant), they hired a company to record their annual conference’s 16 keynote sessions and used an online audio transcription service to translate those speeches into accessible educational videos. As a bonus, the online content showed non-attendees what they were missing by skipping out on the conference – hopefully encouraging more people to attend in future years.
Similarly, examining the analytics programs already available to your association through your association management software, your website platform or your learning management system might yield some pleasant surprises in terms of what data is already available to you. Investing in an additional data analyst for your staff, or offering additional training to an existing staff member interested in building their data analyst skills, might require less budget but yield a realistic return on investment for your association’s current goals.
Champagne: Hiring a consultant to guide your team through new product development.
Sometimes, an outside perspective is what’s needed to stop your association’s “we’ve always done it this way” momentum. It could also help your staff see its way past an issue that everyone knows needs changing, but is too close to the problem to be able to weigh potential solutions in an unbiased, non-emotional way. There is definitely a time and place for outside strategists. They deserve to be compensated fairly for their work, too, but that can be a non-starter point for some non-profits like associations.
Beer: Turning to the creativity already bubbling within your employee talent pool.
The Facebook Live product came out of a company-sponsored hackathon set up mostly for fun, and so Facebook employees could have a chance to show off their coding talents. Evan Reid of the American Speech-Language-Hearing Association holds “data science fairs” where ASHA employees show off how they use the association’s internal data platforms to glean useful insights and to inspire others to get more into data usage as well. In short, more organizations are looking inward to the talent and creativity of their employees – what Scott Steinberg calls “social chemistry” – for ideas about how to innovate. The two-fold benefit to this method is that individuals are recognized for their hidden talents and skills while the organization saves money by reserving the need to hire outside help for another time.
Champagne: Spending a year or more, plus a big chunk of budget, revamping your association’s business model.
Beer: Rely on the ever-helpful association community!
ASAE hosts a page of models and samples pertinent to many areas of association operations. Their Collaborate community is a fantastic place to get advice and recommendations about everything from adopting a new business model to which event photographer to hire. There are likely online communities dedicated to your association’s particular industry as well. A little online research or in-person networking should help uncover those hidden gems in no time.
Adding value through innovation doesn’t have to be expensive. Consider the ways your association wants to innovate this year, and then ask: Do we need to splurge on the champagne option, or can we get creative and enjoy the same results with a lower-cost path?
