Tony Rossell serves as the senior vice president of Marketing General, Inc. in Alexandria, Virginia. A frequent writer and speaker on marketing topics, he is a contributing author to two books, Membership Marketing (ASAE 2000) and Membership Essentials (ASAE 2008). Contact Tony at 703-706-0360 or at Tony@marketinggeneral.com.
This year I will be attending the ASAE & the Center for Association Leadership Annual Meeting & Exposition in Los Angeles, CA. If you will be attending, I would enjoy meeting you in person. You can find me at the Marketing General, Inc. booth number 500. Please come by.
Here are a couple of quick thoughts you might want to try to improve your membership renewal rates.
1. Frequency – How many touches do you have in your membership renewal program and how do you know how many you should have? Here is the rule of thumb; you should continue to spend money on renewal or reinstatement efforts until it costs less money to bring in a new member. Based on this formula, I know one membership organization that now has a 40 touch renewal program that includes mail, phone calls, and email.
2. Offers – Many membership organizations are finding that renewal payments are getting later and later from members. This is costly because more renewal efforts are sent out and it hurts cash flow. Here is how one group has moved up payments. They have included a product voucher offer in their early renewal notices. If a member renews early, a voucher or coupon is sent to the member that they can redeem toward the purchase of a product or service from the organization. Offering the voucher has lifted early renewals, but a low redemption rate has cost the association very little. And any member who makes an additional purchase from an association has a much higher likelihood of renewing in the subsequent year.
3. Channels – In some social media that I monitor, I hear the question posed, “should I move my renewal efforts from mail to email?” I think that the answer should not be “either/or”, but it should be “and”. In our 2010 Membership Marketing Benchmarking Report, we highlighted that 88% of associations now use email in their renewal program compared to 83% in 2009. Associations using direct mail for renewals dropped from 91% to 85%. But based on these high percentages, it looks like most groups use both of these channels. What seemed to most positively impact renewals was adding additional communication channels. For example, staff renewal phone calls, fax, and peer member contacts were positive indicators for renewals with the groups that used these channels.
Feel free to add any additional tips that you might have to the comments section below.
In addition to his work with me at Marketing General, Inc. my colleague, Vinay Kumar, also spends much of his time as a career coach.
I wanted to share a couple of links to some of his recent articles and posts on careers that I think you will find of help.
Today, Vinay had a piece appear in the Washington Post on how to network at a professional event or party. He provides some simple steps you can take to connect with others.
Under the “Good Blogs” section of this blog, you will find Vinay’s latest postings displayed. So when you need a good career suggestion, please click through to his blog.
This summer I decided to try and read something more enduring than the latest marketing or business book. So when I received the book, The Cross of Christ, as a present, I decided to dive into it. The author, John Stott, served as an Anglican priest in London, but because of his writing has been recognized by Time magazine as one of the “100 Most Influential People in the World.” This is considered to be his classic work.
Even though the book is about themes with which I am familiar, I have found that the depth, perspective, and logic has taken the subject much deeper than I have considered before.
Here is a quote that provides an overview of the major themes of the book.
“The cross enforces three truths – about ourselves, about God and about Jesus Christ.
First, our sin must be extremely horrible. Nothing reveals the gravity of sin like the cross. For ultimately what sent Christ there was neither the greed of Judas, nor the envy of the priests, nor the vacillating cowardice of Pilate, but our own greed, envy, cowardice and other sins, and Christ’s resolve in love and mercy to bear their judgment and so put them away. . . .
Second, God’s love must be wonderful beyond comprehension. God could quite justly have abandoned us to our fate . . . But he did not. Because he loved us, he came after us in Christ. . . It is more than love. Its proper name is ‘grace’ which is love to the undeserving. . .
Third, Christ’s salvation must be a free gift. He ‘purchased’ it for us at the high price of his own life blood. So what is there left for us to pay? Nothing! . . . The same cross of Christ, which is the grounds of free salvation, is also the most powerful incentive to a holy life.”1
I will get back to membership marketing with my next post. I find that email, twitter, and phone calls take me away from thinking more deeply about big issues in life. I have enjoyed reading more deeply this summer.
1. John R. W. Stott, The Cross of Christ, IVP Books, pages 85-86.
One of the benefits of publishing research is that people read it and provide feedback. Your ideas plus my ideas equals better insight.
One of my colleagues just pointed out to me that there is some important data in our Membership Marketing Benchmarking Report on how associations are using email and how effective it is for them.
When we look at several key membership marketing functions, our statistics show that email usage has grown from 2009 to 2010. The following chart shows the percentage of associations using email for building awareness with prospective members, getting new members engaged with the organization, and renewing members all increased.
Interestingly, when asked to rate the effectiveness of using email to recruit new members, those who said that email was the “most” effective channel, dropped from 24 percent in 2009 to 10 percent in 2010.
Bottom line, associations are using email more, but there may be a drop off in productivity.
Last week I had the chance to facilitate a session at the ASAE and the Center’s Super Swap meeting.
Of course, the topic of social media came up for conversation. And my impression from those who shared made me feel that many associations are experimenting with various social media tools, but may not have a focused strategy in place on what they are trying to accomplish.
As I was thinking about it this week, I came across a post on the LeaderConnect blog that summed up many of my thoughts on the practical uses of social media really well. So I wanted to share the three points this blog made on practical social media strategies here.
• “In-bound marketing. You’re trying to “get found” in an age of media clutter and ever-more effective ways of blocking your marketing messages. Outbound marketing—advertising, direct mail, trade shows, PR—will always be necessary but our patience with that sort of messaging evaporated a long time ago. You want to be where your potential members are and position yourself as an organization with interesting, worthwhile things to offer. They come to you rather than you beating on their door begging to be let in.
• Lead generation. You’re trying to find them without renting a list or paying the trade magazine in your industry to do it or buying a booth at a trade show in order to collect business cards. If you are in the right social media groups and you’re paying attention and posting content that the group cares about, you will find potential members (and speakers and sponsors and contributors).
• The Deep Sell. We had a wonderful client at Pier 1 Imports years ago. He called content “the deep sell.” You are not selling Papa-san chairs. You are selling relationships, access to a network of smart people who share interests and want to have substantive, valuable exchanges of information. You can’t do that in a one-page ad. Social media enables you to explain yourself, to market yourself based on value rather than on price.”
The unifying strategy here is using social media to connect potential members and prospects with you. I describe it as an economical way to put a store on a major highway. Prospective members are driving by and social media can give them a place to pull over and connect with you. If you would like to read the entire post, here is the link.
In the July issue of Associations Now, I had the opportunity to write an article highlighting some of the key strategies needed for a growing and thriving membership ranging from acquisition to engagement to renewals.
I think you will find the article helpful. It is available on ASAE and the Centers’ website. Feel free to download a copy. If you are a member, you can also comment on the points that I make.
This is by no means and exhaustive list, but I have come up with a list of what seem like the four major reasons why a healthy organization can come to a dead end in membership growth. Feel free to add your thoughts on additional reasons.
Here they are.
1. Market Saturation: There is no such thing as perpetual growth. At some point every organization will hit a point of getting all the prospects who want to join.
2. Disenchanted Members: Whether it is poor customer service, a lack of new compelling content, or a weak fulfillment operation, unhappy members can stop growth fast.
3. Competition: Millions of smart people are daily trying to come up with a better products and services. If someone else can give better information, faster service, and lower prices, then an organization can be outflanked.
4. Inadequate Marketing: You can have market potential, happy members, and the best product, but if you do not get the message to the right people, then growth will stop.
Interestingly, although each of these situations can halt growth, I think that there are potential solutions that can help an organization “jump the curve” and extend growth. The solution starts with acknowledging there is a problem and then focusing on the root causes not the symptoms presented by the problem. Perhaps we can look at some of these options in a future post.
One of the most enjoyable projects that I work on each year is the Membership Marketing Benchmarking Report. As I have noted on this blog, I was very appreciative to have 407 associations participate in the research this year. If you were one of those groups, you should have received a link to the full report last week.
Today, I wanted to share ten top tips from the hundreds of findings appearing in the report.
1. Out of a list of 10 options, association executives are most likely to rank growth in member counts (22%), revenue growth (21%), and net revenue growth (21%) as the primary definition of success for their organization.
2. Findings indicate a more marked difference in membership growth of over 11% for those organizations focused on acquisition rather than those focused on retention or on a balanced strategy (18%: acquisition vs. 4%: retention and 9%: both), the five year change in membership (38%: acquisition vs. 27%: retention and 34%: both), and the change in new members (24%: acquisition vs. 7%: retention and 16%: both).
3. For associations with over 5,000 members, direct mail is considered the most effective channel for new member recruitment.
4. While Facebook, Twitter and LinkedIn are the most commonly used social media tools, they are not necessarily considered the most effective in reaching membership goals by association executives. In fact, the most effective social networking tools are considered to be those that are basically housed within the association itself, namely the association listserv (50%) and/or a private association social network (39%).
5. Approximately two-thirds of respondents report using mailed welcome kits, a decrease from the 2009 study of 15 percentage points (68% in 2010 vs. 83% in 2009). However, findings indicate that associations with greater than 80% renewal are significantly more likely to use the mailed welcome kits (75% vs. 58%).
6. Directionally, findings demonstrate that associations with overall increases in membership over the past year, as well as those with renewal rates higher than 80% are more likely to attempt more renewal contacts before a membership expires. These increases in renewal rates appear after seven contacts.
7. Associations with renewal rates of 80% or higher are significantly more likely to offer EFT renewals (14% vs. 3%) as well as installment payment plans (55% vs. 35%). Associations with renewal rates less than 80% are significantly more inclined to offer multi-year renewals (54% vs. 18%).
8. Associations showing an increase in renewals over the past year are significantly more likely to offer automatic credit card renewals, compared to associations with declines in renewals (29% vs. 17%).
9. Unlike in the 2009 study, price is not the top driver responsible for non-renewals; in fact, one-third of the association executives indicate that they believe members do not renew because they perceive a lack of value in the organization. This is an increase of about 80%.
10. Associations did not experience radical changes in membership numbers over the past year. The largest percentage of increases or declines in membership ranged from 1% to 5% of the previous year’s total.
If you would like, you can download a copy of the 2010 Membership Marketing Benchmarking Report here to see the data and charts associated with these tips. Web site registration is required for the download.
Please feel free to share your thoughts and reaction to the report in the comments section below.
As I dive into the data from our 2010 Membership Benchmarking Survey, I am discovering some very interesting outcomes. I will be sharing some of them on this blog, but of course the full report will go to the 405 associations who participated in the research.
The power of any survey data is not in the answers themselves, but in the cross tabulations. Looking at one answer compared to another. Today I took a look at official usage of social media by associations cross tabulated with associations reporting either membership growth or decline.
The crosstabs highlight patterns or correlations that can aide an organization in making decisions. However, please remember that a correlation is not a prediction. Because organizations doing one activity display higher growth rates than those that do another does not mean that replicating that one behavior will result in growth.
There is a lot to discuss in today’s data. Here are a few comments. First of all, there has been an explosion of the use of social media in associations. Only 8% of associations participating in the survey said that they do not officially use any social media tools.
The most popular social media application used by associations is Facebook with over 75% of associations reporting that they officially use it as an organization.
On the other hand, only 17% of associations reported that they have a “private association social network”. And those organizations who have a private social network are 28% more likely to report growth in membership compared to the average association. While groups that use LinkedIn are 13% more likely to report a decline in membership numbers.
Here is a chart that takes a look at the top responses from the survey.
I would appreciate your theories on what this data may be saying about social media and how it can impact an association. Feel free to post your thoughts.
If you are planning on attending this year’s Marketing and Membership Conference, I would enjoy meeting you. My company, Marketing General, Inc. will be hosting a reception from 5:15 to 6:30 on Monday, June 14th after the first day of sessions. Please stop by the reception so we can meet.
At the reception, we will also be distributing the executive summary of the 2010 Membership Marketing Benchmarking Report. I would like to share a copy with you. The report in its entirety will be going out next week to the 407 organizations who participated in the research.
I look forward to meeting you if you will be attending the meeting.
“Are we delivering the value members want?” It is a common question that I hear from clients these days. Value seems to be the top issue on many membership marketers’ agendas.
Our 2010 Membership Marketing Benchmarking Survey confirms the heightened concern around this issue. For a second year, we asked association executives what was the top reason that their members did not renew. Last year the answers focused on cost with the top two reasons given as “the employer would not pay for membership” or the membership was “too expensive”.
However, for 2010, the top reason given for non-renewal was a “lack of value”. A total of 36 percent of respondents sited value as the key issue an 80% leap over last year.
Is there any good news in this? I think so. When we believe members lapse because dues are too expensive, it does not leave much room for fixing the problem. However, if we think members leave for value issues, we can do research and member interviews to better understand what they are looking to receive and make changes to communications or the products themselves to enhance the value.
Asking how we can deliver more value to our members is a very productive question when we put actions behind it to discover the answer.
Much effort in membership engagement and retention is focused on informing members of all the great things an association does. But the research shows that giving members more information falls short. Engagement comes by impacting a member’s behavior.
That’s why I enjoyed the comments by David Gammel, in his May article in Associations Now, Connect. Engage. Accelerate. He writes, “I define member engagement as the following: Engagement is the result of a member investing time or money with the association in exchange for value.”1
I agree with his definition. And in fact from my research, it is not only a good definition, but it actually works.
Awhile back, I reported these results from a membership analysis that we did.
• Members who upgraded their membership in the past year to a higher level of service were 12% more likely to renew.
• Members who placed a product order in the past year were 28% more likely to renew than those who had not placed an order.
• Members who also maintained membership in an optional local chapter along with their national membership were 17 percent more likely to renew than those who were not a member of a chapter.
• Members who attended an association meeting in the past year were 19 percent more likely to renew than those who did not attend a meeting.
• Members who attended an association meeting at any time in the past were 7% more likely to renew than those who never attended a meeting.
• Members who attended four or more meetings were 30 percent more likely to renew than members who never attended a meeting.
But the engagement does not just need to be a financial exchange. Engaging interaction can be as simple as a phone call. In a presentation for ASAE and the Center that I did with Karen Gebhart, President of the AOPA Foundation, we reported that their research showed members who called the association’s ‘800′ number compared to those who did not had an improved retention rate.
Gammel also highlights, “If you accept that engagement occurs when someone invests time or money with the organization in exchange for value, you can then consider opportunities to do so before that person becomes a members as well as after.”2
In my membership lifecycle vocabulary, I call the pre-membership engagement stage awareness, but the concept is basically the same. In essence it is helping a potential member to find you and initiating some level of relationship. One method is what I have come to call trading content for contact. If you want more information on this take a look at my post, The Push and Pull of Membership Recruitment and see how this strategy might be used at the introduction or awareness level.
The bottom line is that lots of information sent to a member does not build engagement. However, finding ways to get a member to interact, use, and take advantage of the value you offer builds your member relationship.
1. Associations Now, C. David Gammel, CAE, Connect. Engage. Accelerate. May, 2010. 2. Ibid.
In our Membership Marketing Benchmarking Study this year, we asked participants to tell us their membership growth strategy. We offered three options:
1. A greater priority on acquisition than retention
2. A greater priority on retention than acquisition
3. An equal priority on acquisition and retention
Then we cross tabulated these answers with reported membership growth rates over one year and five years.
Which one do you think correlated with increased membership growth?
It was interesting to me to see that putting a priority on membership acquisition compared to a retention strategy or a balanced strategy directionally linked to growth in membership. The following chart shows the proportion of those who reported following one of these strategies who experienced at least one percent growth this past year or over eleven percent growth over five years.
How do I explain this outcome?
Here is my theory. There is only so much you can do to keep members. After awhile you reach the point of diminishing returns by trying to renew retired members or those who have left the field. But there is always more that you can do to get new members. So moving additional investments to acquisition is more likely to pay off for a membership program. What do you think?
The last few months, I have received a number of questions related to dues increases and pricing issues for membership.
If this is a topic of interest for you, please feel free to join me and my colleague Erik Schonher for an ASAE and the Center Membership Idea Swap titled, The Fundamentals of Pricing and Value.
The session will take place this Wednesday, May 5, from 9:30 to 11:30. Here is the link to register.
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