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Wednesday, September 20, 2017

How Do Economic Forces Impact Engagement?

Engagement involves a series of personal decisions that are in constant flux as the person's interests, needs, and situation change.

In 2007, Forrester Research called Engagement marketing's new key metric. It was defined as: "the level of involvement, interaction, intimacy, and influence an individual has with a brand over time."

Association Laboratory research identifies a substantial link between the economy and association engagement.

The following graph from Looking Forward 2014, Association Laboratory's association business environmental scan, highlights what association leaders believe are the most significant implications of economic forces on key forms of engagement.

Impact of Economic Forces by Type of Association

In order to address these challenges, it is critical to identify and monitor the most relevant economic forces impacting engagement.

The "economy" is neither simple nor static. It is not a monolithic "thing" to be analyzed but an aggregation of myriad markets consisting of commercial, government, and individual customers spread across different industries, professions, and geographic regions.

In addition, other forces related to the economy have an impact.

Based on Association Laboratory's environmental scanning research, and on primary research supported by a research grant from the ASAE Foundation, the following economic-related areas substantially impact the association engagement decision:

Role of Government

In addition to being a buyer and seller of products and services, the government also establishes the rules of commercial interaction via legislation and regulation. The volume of changes and the nature of these actions substantially impact how organizations and the individuals they employ do business.


Technology is a disruptive force that creates or allows access to new or different markets, lowers the barriers to market entry, and allows for new business models. Technology allows for faster, more seamless exchange of information between customers and suppliers, and among potential customers, as customer reviews impact new or potential buyers.


Organizations and individuals operate in an interconnected, global system. The following is an excerpt from Looking Forward 2013:

The global system includes the movement of capital, labor, and information. Even small organizations are participants in a global supply chain. Consider the following:

Economic Globalization - Individuals and businesses now access a global market place and the barriers to providing services and products worldwide are rapidly decreasing.

Government Globalization - From regulatory action to trade agreements, actions by governments in one part of the world routinely impact organizations across the globe. The actions of governments and relevant non-governmental organizations (NGO) are now seldom restricted by borders.

Supply Chain Globalization - Modern supply chains access raw materials and production capacity from all over the world to serve widely dispersed markets.

Financial Globalization - Capital markets operate across country borders allowing investors' access to companies worldwide.

Workforce Globalization - Individuals have routinely traveled across borders in search of opportunities. Now, workers are connected virtually and communication technology has made it possible for businesses of all sizes to access labor on the other side of the globe through services such as Odesk. [Odesk is an online professional services portal where individuals from all over the world post their expertise, accept business, and provide contract-based services.]

Cultural Globalization - Cultural influences now routinely affect people worldwide. For example, in Chicago, IL, USA, people gather each Sunday morning at an Irish pub to watch English premier cup football, then eat lunch at a local Ethiopian restaurant before dancing the night away "gangnam style" to a Korean pop song. Communication technology virtually eliminates the barriers to cross-fertilization or transmission of ideas, meanings, and values across national borders. However, despite the enjoyment individuals receive from global influences in entertainment and leisure options, this creates pressure on cultural identities. Creeping nationalism is a growing influence as humans seek their place in a world with no borders.

While these cultural influences have existed for some time, communication technology now allows aspects of globalization to be integrated at speeds unprecedented in human history. Today, even the smallest rural markets can participate in the global economy in a way that only larger urban areas could in the past.

No discussion of the economy and the implications on association engagement and membership models can be complete without acknowledging the impact of these strategic forces.

The perceived future economic direction of an industry or profession impacts engagement decisions. Improving economic circumstances increase the likelihood of engagement while static or declining economic circumstances decrease the likelihood of engagement.

Association Laboratory recommends that associations monitor the economic circumstances of their industry and profession and create a process for continuous dialog on the implication of these forces on the association.

In our next strategy blog, we'll explore how these forces are impacting how employers make decisions and the implications on engagement.

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