Retailers have been hit particularly hard this season, but not retailers who offer membership. Costco is reporting big membership gains and strong membership renewals.
“At quarter-end on November 23, our paid executive membership topped eight million, an increase of almost 400,000 or 5% just in the last 12 weeks or about 30,000 per week increase in the quarter so again its still has been a big success for us. . . In terms of renewal rates as I said they continue strong, essentially our all-time high renewal rate. At Q1 2009 the numbers both for business, Gold Star end total were the same as they were at fiscal year end and rounding up a percentage point versus a year ago, business coming in at 92%, Gold Star at 86%, and total a shade about 87.0%.“[1]
How can you replicate this success in your organization?
[1] Costco Wholesale Corporation F1Q09 (Qtr End 11/23/08) Earnings Call Transcript
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6 comments:
You need to offer something essential (like food), not just something that is desired, and offer a financial incentive that beats the competition.
Certification is essential, even if you've lost your job, and assistance in doing your job more effectively (that's what associations do) is often essential.
David -- You got it. You have to have value that people want. And then you need to make an offer. Tony
Offer good value on the kinds of products your markets segments want (meaning you must know your market niches) - and do that better than the alternatives - as consumers view our alternatives.
And do it consistently - so people trust the company and the quality/price of what it offers...
like Trader Joe's & Southwest Airlines...
the same company names remain high on the trust-the-value and like-how-they-treat-us scale.
I wrote two articles for them - one for the U.S. market and another for the Canadian and was startled by the response.
Over 300 mostly intelligent letters and many sales of my books and tapes on my web site - even though they were not mentioned in the articles.....
writing in the reflected glow of trust that Costco emanates is good for all players, including the vendors (who sold to Costco) i interviewed ... this is my fan letter - unsolicited by Costco
- another fan of Membership Marketing blog
There's a lot that goes into Costco's success (monthly pubs, regular mailings of coupons, a rebate of 2% at the end o fthe membership year, many unique in-store promotions, etc.) The value is not just in getting into the stores to buy oversized products.
David's got a point . . . food is essential and Costco builds the desire for other stuff while you're shopping. Roll out those sample carts membership directors!!
Good point. So what can associations roll out as samples? Tony
ASCD provides sample journal articles and book chapters on our web site. We also compile a "Best of" pub of articles from the previous publishing year of our journal. We have a podcast. Most of all we have our "bill me" option that allows a prospective member join and then be billed for their dues. It allows them to experience membership asif they had already paid dues. It definitely has helped us grow and payup is excellent. We've improved our processes well enough to "carry" less than 2% of these bill me members at any given time.
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