Corporations Coop Membership Marketing

Is your next job likely to be the membership director for a corporation?

I ask this question, because last week I received two interesting calls seeking membership consulting services. The first was from a credit union that wanted to recruit more members.

Okay, that made sense.

However, the second call was from a web news broadcasting company that is signing up hundreds of “members” who pay dues of $10 each month.

To top it off that night I went home and received a mailing from clothier Joseph Banks telling me of the upcoming “Corporate Member” sale.

Of course, I am already a member of Costco and American Express.

Clearly the corporate world is increasingly tapping into the membership concept to support customer relationship marketing efforts. They understand that people want to feel like they belong and they are special.

If you think I am overstating the case, take a look at some quotes from an article by David Frey entitled: Membership Marketing: Turning Occasional Buyers into Loyal Customers. He believes that

“Every business can benefit from a membership program and should establish some form of membership marketing.”

He goes on to explain:

“Membership programs provide powerful benefits that will improve your company’s performance. Let’s take a closer look at the benefits that were just mentioned.

1. Conserves limited company resources – Resources are allocated according to the customers’ level of membership (i.e. lower membership level = less resources, higher membership level = more resources).

2. Increases customer loyalty – Membership provides a sense of belonging to an organization, which breeds loyalty.

3. Provides a predictable stream of revenue – Instead of sporadically selling products and services, membership programs provide a steady stream of customers providing a steady stream of cash flow.

4. Sells more services and products with less effort – Because slow moving or less desirable products and services are included in membership packages people are more likely to take advantage of them.

5. More revenue from existing customers – Multi-level membership programs incentivize customers to spend more by moving up to higher levels of the program.

6. Improves referral business – People like to tell their friends about a company to which they feel a sense of loyalty.”

Frey’s article is very good. It sounds like it could have been written for association in Association Now. But it is directed at corporate marketers.

If you would like to see the entire piece, I have provided the link here.

What are your thoughts of the use of the membership model by corporations seeking to strengthen the customer relationship? Feel free to post your thoughts here.


Greg said...

WOW. A membership position with stock options. That could be a trend setter.

Seriously, this is just one more example of the competition traditional membership organizations are facing today. When you factor in that time is the real currency, then there is an even greater threat, or opportunity depending on the response.

Some long-term questions. Will deep pocketed, for-profit companies change the expection of what it means to be a "member" and will associations be in a position to effectively respond?

Has the increase of "membership" based prgrams in the private sector, demished the value of our memberships? Are our members beginning to see themselves as customers, rather than owners? I am not talking about the engaged volunteer here, but the rank and file member. And if the rank and file member sees him or herself as more of a customer, what does that mean for our future.

The recently released ASAE study, The Decision to Join, clearly shows that younger professionals join and take advantage of association membership based more on career stage, then age. If that is the case, when the younger association professionals do know on our door, will be prepared to offer the kind of membership experience they seek and will the for profit world have already defined the experience for us?

Deep thoughts on this Monday afternoon.

Tony Rossell said...

Greg -- Thanks for the comment. I know that the role of the membership director is a subject near and dear to your heart. I think you raise some very good points here -- especially will members come to see their role simply as a customer with the expansion of the use of this term. Clearly, "membership" is a powerful word. Tony