How much should you pay for Association Nonprofit Software

How much should you pay for Membership Software today?

How much does AMS membership software cost? And, how much should we budget?

In this article, we wanted to explore the money questions we get quite a bit from nonprofit and association executives.

From our experience, Nonprofit Associations are very good about benchmarking. In a sector where donors and members scrutinize where the money is going, benchmarking is used with success. If a nonprofit doesn’t benchmark outcomes, there is certainly a third-party agency which likely is!

The Study Cited for Membership Software Budget 

Recently, we reviewed a study conducted in 2013 by CliftonLarsonAllen on behalf of the Texas Society of Association Executives (a wonderful resource!). The “Texas Associations Matter” study outlined the economic impact which nonprofit associations have on the Texas economy. Further, the comprehensive study outlined the specific demographic details of the roughly 1,900 organizations in the state. Here are some takeaways from an IT software perspective which may help all nonprofits in every state answer the questions above:

  • Small associations (less one million in revenue) represented 71% of the total association nonprofits in Texas
  • Across all association size classes (Small, Midsize, Large) each year associations in the state of Texas spend about 3% on technology and web expenses
  • Small Associations (less than 1 million in revenue) on average spend about 5% on technology and web expenses

Apart from the mere fact that everything is bigger in Texas (You know we are still a Republic, right?), if you believe in the value of benchmarking data, this study suggests that you should at a bare minimum be spending 3% of your operating budget a year on software technology for your nonprofit association.

I would like to stress, at a minimum. Because, in order to truly keep up it will be important for your organization to consider spending more. You must consider going beyond the averages to excel and grow. Nonprofits and Associations are competing with so many entities today for mind share and remaining viable. It’s not enough just to “keep up” with the “Joneses’ of the Nonprofit Community”. Rather, moving forward into the 21st Century executives are going to have to think of new ways to grow and attract new members/donors in ways that they have never imagined. And, technology will be a big part of helping in that effort.

What Should you Budget for Membership Software? 

In the book, “Race for Relevance, 5 Radical Changes for Associations“, the author, Harrison Coerver, underscores the point that Associations will need to invest more in the future to remain relevant. In essence, he believes that conventional wisdom of the old guard must change in order to adapt to the “new frontier” of associations. The conventional approaches and paradigms of yesteryear no longer fit in an environment that’s been fundamentally and irreversibly changed. Harrison also stresses that technology (web and software combined) will quickly become an integral component of an associations functioning and performance. And, to realize this will require a major shift in the mindset of association nonprofit executives across the board to truly embrace technology rather than begrudgingly invest in it. In short, he says that your “spend” should be in the range of 8% to 10% of total revenue to remain competitive.

Just to reiterate, this is double what is transpiring now in the great state of Texas. And, I would venture to assume that other states are similar if not less in spend than Texas. Wouldn’t you?

So, how much should you budget on your website, information technology and nonprofit association software?

Where is the lovely sweet spot?
How much is enough?

Well, in most expert opinions, your nonprofit needs to spend at least the minimum but even more should be considered to grow and remain relevant.  But, the answer for your particular organization will vary. Hopefully, this information can be used as a discussion point to put some perspective on your next budget meeting for information technology. As we stress quite a bit here, it is important to set realistic expectations.

The good news for most forward thinking nonprofits is that most systems today are in the reach of even the smallest nonprofits. The key is finding the right one for you based on all factors involved including a realistic budget.

If you need help auditing your needs or gaining some consensus on software choices, please reach out to us. Until then, keep SmartThoughts in mind!

Free Membership Software Purchase Guide for Nonprofits

Beyond the Search, Be cautious with the search for Association Nonprofit Software

SmartThoughts is a specialist in search for nonprofit software

Beyond the Search Engine, there are SmartThoughts for your

Association Nonprofit Software

It’s a fact. Many consumers take the typical path of going to their favorite search engine, Google, Yahoo, or BING to start their process of “Window Shopping”. For most nonprofit executives, the job of reviewing software options is delegated to a staff member. And, searching on the internet for software options is where they will likely begin the search process.

Here are some staggering facts which accentuate that point:

  • B2B buyers are anywhere between 57%-70% through the buying process prior to engaging with a partner vendor about their products.
  • Some 35 percent of B2B pre-purchase activities are performed digitally
  • Data worldwide is growing 40 percent per year

The Perils of Search Engine Software Selection

What does this mean for a nonprofit software executive reviewing software options?

This means you need to be cautious and understand that your staff may be relying to heavily on search engines to select your nonprofit software solution. “Searching” may be a good starting point, but it shouldn’t be the only source for finding a software solution which will ultimately be the foundation for serving the needs of your member and donors well into the 21st Century.

The overwhelming data and plethora of nonprofit software options needs to be sifted and analyzed alongside your requirements to determine the proper fit. In fact, the last review of Association Management Software vendors, we tallied up 100 organizations which purport to be providers of a solution.

Wow! No doubt there are many association management software options and there are even more who provide donor management systems. 

It’s easy to fall into the search selection trap with the workload of many small staff nonprofits today. Time is usually of the essence for most staff executives to get a solution. And, reviewing requirements, setting goals, and the demonstrations of software options can take a considerable amount of time. For most staff members charged with finding a solution, the software selection process can be frankly a distraction to performing the fundamental high priority job functions which they are responsible for day in and day out.

The outcome for this approach is usually an ill advised decision or no decision which can extend the process out for months and even years before a true solution is found.

We have a decade of working with solid and reputable software vendor partners in the nonprofit market.The odds are we can work with your staff in short order to discuss various technology providers available on the market today and lead you on a better suited path than randomly going through the “Search Engine Selection process”.

Give us a call, It’s Free!

Until then, keep SmartThoughts in mind.