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Responding to recession.

Reeling from the economic impact of a recession, associations are pondering not only how they will survive but how they will help their members continue to function and prosper.

Members of associations in the travel, real estate, banking, and retail industries have been particularly hard hit by this recession. Coupled with the threat of terrorism during the Persian Gulf War, the recession has caused U.S. consumers to put vacations on hold and prompted many organizations to cancel or delay their meetings and conventions. In January and February, domestic and foreign travel plummeted about 9 percent and 25 percent, respectively, compared to the same time last year, according to Christine Levite, director of public affairs, American Express Travel-Related Services, New York City.

In response, the United States Travel and Tourism Administration, Washington, D.C., and the CEOs from more than 60 corporate travel-related organizations and several travel-related associations formed "Go USA! The Travel Coalition" in January to help rebuild confidence in the world's travel system and ultimately, to boost sales for their members. Associations in the coalition are the Travel Industry Association of America, Washington, D.C.; American Hotel & Motel Association, Washington, D.C.; Air Transport Association of America, Washington, D.C.; National Tour Association, Lexington, Kentucky; and American Society of Travel Agents, Alexandria, Virginia.

In February the coalition instituted an advertising and public relations campaign to get travelers into planes, trains, hotel rooms, car rentals, travel agencies, and tours: the services their members offer. On behalf of the coalition, the United States Travel and Tourism Administration has written travel-related speeches given by the President of the United States and the Secretary of Commerce and got the First Lady to fly on a commercial airplane to Indianapolis. Other coalition members have visited countries to encourage travel planners to book trips and meetings for their clients. Corporate travel-related companies have donated money for the effort, while association coalition members have provided staff support and in-kind services.

Although Jill Collins, director of public affairs for the United States Travel and Tourism Administration, says it's too early to tell whether the campaign has been successful, she is optimistic about the immediate future of the travel industry. "The war is over and economists predict the recession will end by early fall," she says. "People [and businesses] are beginning to develop an upbeat attitude and want to get on with their lives. Hopefully, seeing an ad or hearing a speech will be just the thing to motivate them to travel."

Whether or not their perspectives on the recession reflect Collins's optimism, many associations are developing and implementing programs, products, and services to help their members through the difficult economic times. And most associations--which, like their members, are keeping a close watch on the bottom line--have developed products or services that require little, if any, additional budget funds.

Others, like the American Hotel & Motel Association, feel spending additional funds to help members is justified. AH&MA's crisis-management bulletin--produced following the outbreak of the Persian Gulf War to remind AH&MA's 10,000 members about security programs they should implement at their hotels--was one unplanned expense. "Cost was not a big consideration. Urgency drove the decision. I would not want to find myself in the face of these developments going to my budget to see if monies were available. It would have been totally inappropriate," says AH&MA Executive Vice President and CEO Ken Hine, CAE.

Alice McCord, senior vice president, National Retail Federation, New York City, takes Hine's message a step further: "If a company can't partake in association activities, the association increases its risk of losing that company as a member." Association executives interviewed for this article agree it is in an association's best interest to develop innovative products and services that cater to the needs of its members. The following examples illustrate how associations have responded during the recession to the changing needs of their members.

Recession-related publications. AH&MA devoted the content of its October Lodgin Magazine to how hotels can better manager their properties in a tough market. The magazine produced an 88-page Tough Times: A Survivor's Guide, which offers in-depth articles on conserving energy, improving hotel efficiency, and selling property. "We knew our members would be looking to us for leadership," says Phillip Swann, Lodging Magazine editor. "We wanted to take our readers by the hand and offer them concrete information that would help them better survive the recession."

The article "Ten Ways to Beat High Energy Bills" has been a big hit among members. According to Swann, energy-saving suggestions range from doing an energy audit to checking utility rate schedules to developing a new lighting plan. "Many hotels had lost their focus on energy conservation over the past few years," Swann explains. "This article reacquainted them with the problem and identified solutions."

Since last fall, AH&MA has received a "phenomenal" number of reprint requests and more than 50 orders for the entire issue, according to Lodging Magazine Publisher Larry Price, who says the association published a similar issue in May devoted to 100 money-saving ideas for the lodging industry.

Advertising In a Recession: The Best Defense Is a Good Offense--a 48-page booklet published by the American Association of Advertising Agencies, New York City--provides data to AAAA members on the value of advertising during a recession. The association produced the 48-page booklet--selling for $5 per copy--so that its 750 advertising-agency members can relay the information to their clients, namely advertisers.

"During a recession, advertisers often regard advertising as an expenditure and not an investment," says AAAA Vice President of Public Affairs Joyce Harrington. The association hopes the booklet's data--which include studies conducted by McGraw Hill, Inc., and The WPP Group's Center for Research and Development, San Francisco--will "convince advertisers that it's in their best interest to maintain their advertising budget or even to possibly increase it" during a recession.

In addition to the booklet, one of AAAA's members produced a black-and-white advertisement--available in three sizes--that encourages readers to purchase the publication. Fortune, The Wall Street Journal, and The New York Times are among the publications that began running the pro bono advertisement last spring. As ASSOCIATION MANAGEMENT went to press, AAAA had received 91 requests from publications to run the advertisement.

Harrington expects that the $5 charge for the booklet will help the association recoup any money spent on producing it. "AAAA's entire dedication to its membership is to help them run their businesses more productively and more efficiently," Harrington says. "And since our income is largely based on our member's dues, making our members more profitable keeps us in business."

A different format. Mark Hoewing, executive director, International Association of Corporate Real Estate Executives (NACORE International), West Palm Beach, Florida, took a different tack on publications. He cut the price and maintained the level of service of The Placement Newsletter, the association's monthly newsletter listing jobs available and jobs wanted. By changing the newsletter--from a one-color, typeset-and-printed publication to one that is produced on a laser printer in-house--the association was able to reduce the annual subscription price from $40 to nothing. To receive the monthly newsletter, members are only asked now to send 12 self-addressed, stamped envelopes.

"Now we can offer [members] a simple newsletter with the same information for free," explains Hoewing. "I made a determination that certain [association] pieces need an image--such as the magazine and membership brochure--to represent our association as a serious player. Then there were other pieces that simply needed to provide members with information. The newsletter is one of them."

Hoewing estimates that producing the new free service--which has received rave reviews from members--costs the association less than $5,000 annually in staff time. "We were able to cut our overhead expenditures and invest the monies saved in our other member services," he says.

Timely bulletin. No sooner had war begun in the Persian Gulf when AH&MA's Hine--who was attending a business meeting in Florida--was on the telephone to his Washington, D.C.-based staff asking them to quickly put together a crisis-communication bulletin on developing a domestic terrorism plan. Bulletin recommendations included taking an inventory of staff skills, setting up preassigned roles in the event of a crisis, developing a mutual support plan with local lodging establishments, and choosing a spokesperson.

"Staff contacted the FBI and other security agencies to obtain information, and within 45 hours our members were receiving the bulletin on their facsimile machines," he says.

Hine explains that the bulletin had a threefold purpose: to provide direct, easy-to-use information, to remind members AH&MA is an information resource, and most importantly, to give individual properties the opportunity to remind the traveling public that the hotel industry is concerned about their welfare and acts to ensure their safety.

Hine says it's difficult to pinpoint whether the crisis-management bulletin is playing any part in the hotel industry's gradual return to normalcy. "You act in accordance with developing conditions, and you hope it has a positive benefit for your members," he says.

In May the Air Conditioning Contractors of America (ACCA), Washington, D.C., compiled a Management Bulletin for its 3,000 members filled with tips from board members on how each was coping with the recession. One board member, for example, now trains his service technicians as salespeople, thus eliminating separate sales positions altogether. "We wanted to share this [information] with our members so they could see what strategies the leaders of their association are implementing," explains ACCA Communications Director Elaine Smith. "Since our members are all from similar companies, more than likely what worked at one company will work within another as well."

A survey. The National Spa & Pool Institute (NSPI), Alexandria, Virginia, has for three years been publishing an annual Bottom Line Survey, which presents financial operating data for pool and spa retailers, builders, and service companies. Approximately 220 spa and pool businesses provided detailed financial information on their operations.

The objectives of the report are to

* assess the financial performance of pool and spa retailers, builders, and service companies;

* provide comparative financial data to enable businesses to measure their performance against industry averages; and

* provide profit benchmarks that enable businesses to improve their performance.

"It gives them hard evidence of how their company compares to others in the industry," says Robert Glaser, NSPI director of finance and administration. "It allows managers to compare themselves in order to streamline financial operations, decrease expenses, and increase revenues."

New educational slant. Many associations cite the need for members to become better educated on how to cope during a recession. Educational seminars at NSPI, for example, now focus more on business leadership and business management than on product marketing. Some of the organization's recent seminar additions are "Advertising Smarter," "Financial Management for Your Business," and "Winning and Holding Customers."

"Our educational focus is becoming more how to manage your business and how to turn your inventory instead of how to resurface your summer pool," explains Glaser, who says the excellent turnout at these seminars shows how much NSPI members need this information in today's soft economy. "It makes our members more financially cognizant to better prepare them to make it through the recession."

McCord, of the National Retail Federation, says now more than ever NRF is trying to return better value to those who attend NRF seminars and conferences. "One of the most important things members are asking themselves when they come to our meetings is, 'What am I getting out of this for the amount of personal time I've invested?'--they clearly want and expect value received for money invested."

To better meet this need, NRF offers a "cafeteria" of programs: a variety of topics that will appeal to a great number of people. McCord says now most education programs focus on how a member company tackled a current issue--such as "Learning From Tough Times" and "Becoming a Customer-Focused Firm"--and the results of its venture. "They want information they can take back and apply immediately," McCord says. "We think our current [education] format does that."

Weekend meetings. NRF has also begun holding some of its educational programs on Saturdays and Sundays. McCord says the new time enables NRF members to take advantage of lower airfare and hotel costs offered on weekends.

Weekend meetings are also more convenient for NRF's 3,500 corporate members representing 50,000 stores, many of which are small retail firms. "It's easier for the owner of a small store to get away on a Saturday or Sunday," McCord says.

New meeting sites. Typically, the National Spa & Pool Institute has held at least four of its five annual board, council, and committee meetings in resort areas, such as Hawaii, South Carolina, and California; one meeting has always been held in Washington, D.C. But the recession has caused the institute to change its traditional luxurious meeting sites; in 1991 three of the five NSPI meetings are being held in Washington, D.C. Glaser, who estimates that NSPI's elected officers will save $500-$1,000 per meeting, says members have appreciated the change. "It shows them that we are trying to help them out as best we can--that we're battening down the hatches," says Glaser.

Registration reduction. More than 250 International Association of Corporate Real Estate Executives members took advantage of the association's recent registration saver: If NACORE International members registered by Jan. 31, 1991, for the association's annual symposium--held June 29--July 2 in Boston--they would receive $50 off the $570 conference registration fee.

"We figured a lot of people were planning to come to the convention anyway, so here was the perfect opportunity to save them money," Hoewing says. Many early-bird conference registrants have since told Hoewing that the $50 discount gave them an incentive to attend the meeting, which they might not have otherwise been able to afford.

Hoewing says the price reduction has had little, if any, effect on NACORE International's bottom line. "It doesn't cost us $570 to have someone attend our convention," he says. "We didn't lose money. We just cut back on our margin a little bit and budgeted differently."

In fact, this new tactic paid off for both NACORE International members and the association. The association receives its income from three sources: membership dues, advertising, and conventions. The association typically experiences poor cash flow during the early winter months: NACORE International advertisers don't pay for the advertisements that appear in the association's annual directory until the end of December or early January, and members don't send in registration money for the association conference until the spring.

Thanks to the early-bird registration tactic, the association's cash flow fared much better toward the end of last year. "It got us over the hump and gave us dollars to continue operating efficiently," Hoewing remarks.

Dues waiver. Since December, 18 members have applied for another NACORE International incentive: its new dues waiver program. Under the program, members who have belonged to the association for at least three years and are currently unemployed can apply for a 12-month waiver of their annual dues.

"If you have a service useful to the entire membership, it's worth considering making it part of your dues package," Hoewing says. "It doesn't cost $295 [the cost of NACORE International's annual dues for individual members] to serve a member during a whole year, so we wanted to respond to members when they needed it the most."

And supplying such a service has impressed NACORE International's membership. "One member thanked me and said it was so nice to see an organization that truly wanted to help him and wasn't just trying to make money," Hoewing says.

Customer service. Everything you read today, according to Glaser at the National Spa & Pool Institute, stresses how important customer service is to the success of any business. NSPI's new $39 videotape Calming the Waters: Building Your Business Through Good Customer Relations is one vehicle that emphasizes the point to its members. The videotape is used by individual spa and pool retailers to train their employees and as training in NSPI's TECH I certificate program--a 40-hour beginner training program for service technicians, builders, and retailers in the spa and pool industry.

The videotape exaggerates common errors in dealing with a customer and discusses ways to improve them. The videotape provides several tips--from dressing neatly to practicing good telephone techniques--for improving an organization's customer service.

"The videotape is an attempt to show our retail members a lot of the things that they may be doing wrong, whereby they could increase their revenues if they were doing it right," Glaser says.

A task force. The National Association of Realtors (NAR), Chicago, organized a Resolution Trust Corporation (RTC) task force last year to help its 800,000 members--predominantly professionals who sell residential real estate--participate in the property disposition process of the RTC.

RTC--a government branch of the Federal Deposit Insurance Corporation--accepts and disposes of property formerly held by defunct financial institutions. According to John Tuccillo, NAR chief economist and senior vice president of real estate finance, RTC works like this: When a savings and loan becomes insolvent, RTC assumes its loans and pays off depositors. Mortgage loans and other assets that are not sold, however, are temporarily placed into a trust until they are sold.

"You can't have an overhang of government-owned property on the market and have a healthy real estate market. Thus, we [NAR members] have a stake in seeing that the inventory is properly sold and not just dumped on the market," says NAR Executive Vice President Bill North. "We're hoping to suggest to RTC how to more efficiently market these homes at fair value" by offering to auction, list, or sell the homes.

One of the major accomplishments of the 20-member task force was RTC's acceptance of NAR's proposed program, whereby RTC provides seller financing to potential real estate acquirers contingent on certain requirements being met.

"We think that this will speed up the disposition process and attract more buyers," Tuccillo says. "In addition, it will maintain orderly real estate markets, and that helps our members do business."

Legislator education. Bob Kardon, executive director of the California Association of Nonprofits, Santa Cruz, says last February his organization began a "To Know Us Is To Help Us" campaign--a series of informal sessions among California state legislators and CAN's 1,900 nonprofit members. CAN's members, who rely on state funding for 50 percent of their revenue, hope the campaign will educate state legislators about their priorities and "demonstrate what the consequences will be if they [legislators] don't have the courage to raise taxes instead of cutting needed programs," says Kardon.

"During a recession, legislators are constantly making decisions on how to cut their budgets," he adds. "They are dealing with the shock of so many items that need to be cut that they don't have a good grasp of what would happen if they cut monies for a particular program administered by a nonprofit."

Other than CAN's staff efforts, Kardon says campaign costs have been minimal: Both the legislators and the facilities where the sessions have been held have donated their services. Whether the campaign cost $1 or $10,000, Kardon says, "we regard advocacy as integral to our work. It's something we've promised to provide to our members" whether it's in good times or bad times.

And Hoewing, of the International Association of Corporate Real Estate Executives, points out that a member does not forget the helping hand lent by his or her association during trying times. "The heartfelt thanks you receive from members makes it all worthwhile. Those are the kinds of [telephone] calls that really make your day."

Patricia A. Mascari is senior editor of ASSOCIATION MANAGEMENT.
COPYRIGHT 1991 American Society of Association Executives
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:includes related articles; associations offer help to their members
Author:Mascari, Patricia A.
Publication:Association Management
Date:Jul 1, 1991
Previous Article:Plug into the world.
Next Article:The art of speaker selection.

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