The Simple Difference and Beyond: Individual Membership Associations Versus Trade Associations

The Simple Difference and Beyond: Individual Membership Associations Versus Trade Associations

We work with both individual membership and trade associations and sometimes I’m asked to explain the difference between the two. The simple answer is, quite frankly, very simple – but beyond that there are two different cultures that these distinct organizations have.

The simple answer is that an individual membership association is an organization whose members are professionals in a certain industry. Their membership dues tend to be in the in the $100’s and not the $1,000’s every year and they as an individual are the member. On the other hand trade associations are generally comprised of companies who become organization members, often with one or two people representing the organization at meetings – quite often the President or CEO.

Individual Membership organizations generally have at least a few hundred members but can go well above that into the 1000’s and beyond. Their members join because they want to learn, advance their career, get continuing education credits, and are looking to spend time with like minded people. While not always the case these organizations, especially state and local chapters, will have  multiple meetings a year, while very specialized national groups that have a limited number of members across the national will often have one big conference a year.

Trade Associations have a different flow. Their memberships, especially in more specialized fields can be as small as a dozen companies. And their focus tends to be on rallying together to advance the industry and to make sure that the needs of the industry and the people it serves are met. What is hard to do for one company can often be much easier for a group of companies, all competitors, banded together. Trade association meetings also have a different feel, often as the meetings are smaller and more of a roundtable with the leaders of their companies. Put a roomful of CEOs around a table and you are going to have a lot of ideas coming out. What is interesting and great to see in these trade associations is that, companies which normally compete with each other over a contract are coming together with the realization that if they all work together they will all do better. The sayinga rising tide raises all ships” is a very appropriate way of explaining what happens. Sitting at the social event, the dinner the night before the meeting, and seeing a table full of people who are competitors come together as colleagues and friends is one of my favorite things to see in this business.

Whether an organization is full of individual members or companies, both come together with the notion and the reality that joining together is better than standing alone.