Direct Mail is Tops for Membership Recruitment

What marketing channels are most effective in new membership recruitment?

Based on responses from our membership marketing benchmarking survey, direct mail still tops the list with 31.7 percent of respondents saying it was the most effective source for attracting new members.

Here are the channels that were rated as top performers to get new members.

Interestingly, the following registered at less than one percent: Paid Search Advertising, Online Ads, Public Relations, Social Networking, and Print Ads.

I have always maintained that membership is primarily a “push” product. It must be proactively sold. So it is interesting that highly targetable and direct to customer methods are rated as the best in recruiting new members from this research.

Here is some additional data that you might find of interest. The Research Brief Blog reports that "Direct mail's share of total advertising spending has been on a strong upward trend for most of the past 17 years. Since 1999, the direct mail share has risen steadily reaching 22% in 2008. Direct mail has maintained its large ad share even with the introduction of new, fast-growing ad markets such as the Internet."

High Membership Retention Rates Correlate with Growth

In looking at our membership marketing survey data, the power of keeping members correlates with not only overall membership growth for an association, but also with the growth of new member input, which actually comes as a surprise to me.

Here is what I found.

As I noted yesterday, 47% of responding associations reported overall membership growth over the past year. And of those reporting growth, 77% had renewal rates of 80% or better.

While of the 36% who reported a drop in overall membership over the past year, only 55% reported renewal rates of 80% or better.

What is counter intuitive is that not only are higher renewing associations more likely to be seeing overall growth, but higher renewing associations are also more likely to be seeing a higher percentage increase in new member input. This is counter intuitive because typically new members renew at a lower rate than longer term members, so you might expect that groups adding more new members might see lower renewal rates.

Of the 54% of associations who reported a growth in new member input over the past year, 71% of them had renewal rates of 80% or better. While of the 22% who reported a decline in new member input, only 47% of them had renewal rates of 80% or better.

Overall, here is how associations reported their current renewal rates.

By the way, I do present these renewal rates with one major caveat. Comparing one association’s renewal rate to your association is not an exact science because each association operates in a different environment and uses different business rules to count a renewed member. So I am using this renewal data in a broad sense to highlight that renewal rates are correlated to both overall membership growth and even new member growth.

What Research Says about Marketing during a Recession?

As a follow up to today’s post about associations growing membership during a recession, I thought a recent article in The New Yorker made the same point very well looking at the for profit world.

The article looks says “numerous studies have shown that companies that keep spending on acquisition, advertising, and R. & D. during recessions do significantly better than those which make big cuts.”[1]

The article is worth reading and could be useful in arguing against the budget cuts that are being imposed on so many of you who I talk to about this. Let me know what you think.

[1] James Surowiecki, Hanging Tough, The New Yorker, by April 20, 2009

Associations Report Continued Membership Growth

Is membership growth a possibility even in today’s economy? Our membership marketing benchmarking data would indicate that it is.

As you may recall, I am analyzing data from over 400 associations that participated in our membership marketing benchmarking survey this spring. We inquired about growth over the past year and over the last five years.

Here is what we are finding. Over the past year, 46% of associations are reporting that they have seen their total membership grow. While 16% have remained the same and 35% have seen a decline in membership numbers. The numbers do not add up to 100 because some respondents were not sure whether membership grew or declined.

The numbers show a stronger picture when looked at over the past five years. During this time period, 60% of respondents reported growth. And 26% of the associations had membership growth of over 10%. At the same time, 8% reported no change and 26% reported a decline.

In addition to seeing strong growth in overall membership, the data indicates that new member input has also been strong over the past year with 54% reporting an increase in new member input. While 22% have seen a decline and 24% have remained the same.

Although we did not ask for trend data on renewals, we might infer from the data that since new member input is up over the past year at a higher rate than overall membership growth, renewal rates must be lower on average for associations.

Membership Marketing and the Web

I have begun the review of the raw data from the Membership Marketing Benchmarking Survey that we launched this spring. We had over 400 survey participants.

From my initial review of the data there are many surprises and confirmations of what I expected.

My first surprise was how little associations are using the web opportunities to acquire members compared to other membership marketing channels.

We asked participants to highlight what channels they use to get new members and how they allocate their membership marketing budgets over these channels. The results showed that some commonly used web channels for acquisition see limited very use by associations and make up a very small portion of their budgets. For example:
  • Only 8.3% of those who responded use search engine advertising to acquire members and this channel only made up 0.29% of membership marketing budgets.
  • Only 12.2% use banner ads and links on others web sites to market membership and this only made up on 0.13% of the survey participants’ overall membership marketing expenditures.
Based on what the opportunities are using these channels, associations are under utilizing these tools to reach out and attract members. I suspect that these numbers will grow dramatically in the future.

On the other hand, 35.2% are using social networking to help attract members. Still this only makes up 0.78% of membership marketing budgets. Interestingly, 26.8% of associations who report using social media to attract members reported a decline in new member acquisition compared to 21% of the total respondents.

Does this mean that necessity is the mother of invention and these groups are giving social media a try or that social media diverts resources from more productive acquisition opportunities?

The vast majority of respondents -- 84.8% -- use their association website and this only makes up 3.2% of membership marketing budgets.

By the way, just a reminder that the world is changing and we need to keep pushing the envelope. Here is a post card promoting my grandfather’s Chrysler dealership. He is pictured on the left.

Membership Development from the Ground Up

Over the years, just about every membership marketing program has been influenced by tradition, internal politics, or database limitations.

So it was interesting when I met the other day with a talented marketer who joined a group that presented him with a clean slate for membership marketing. Since almost nothing was in place, he had to build the membership marketing program from the ground up.

It got me to thinking, what if I was in the same place? What if my only mandate was to grow membership based on sound marketing principles? What would my membership marketing program look like?

Well here is my take on the programs that I would put in place to get membership moving.

1. Build Awareness - My first action would be to harness the web. Awareness is the first step to any purchase. And the leading source for information for most people has become the Web. So membership development begins with using search engine optimization, search engine advertising, ad networks, and social media to help people who are seeking solutions provided by an association to find me. Tracking traffic sources and the effectiveness of keywords will help me identify the people and the value that my prospects are looking to find.

Anyone coming to my web site would be encouraged to register for a free association newsletter. This allows me to add the prospect to my database.

2. Recruit New Members - The fastest growing membership associations still rely on test-driven membership acquisition campaigns as the workhorse for gaining new members. Ineffective membership recruitment is the single biggest marketing reason for declining or stagnant memberships. So my second step would be to establish regular mail and email promotions to both house and outside lists, And because these promotions will typically be the largest outreaches that the association will do, they statistically lend themselves to head-to-head market tests. Testing will tell me the best lists, offers, messages, and packages to use going forward.

3. Engage New Members - Once a new member joins my association, he or she becomes the most likely member not to renew. Almost all associations show first year members as the lowest renewing cohort. The first year is therefore referred to as the conversion year for new members.

So once I get a flow on new members coming to the association, I would establish a conversion program. This type of effort is a multiple step orientation that helps the member to become engaged in the association. A sound conversion program certainly orients the member to the products, services, and opportunities provided by an association. It also should generate a second interaction with the member. This might be as simple as having the members complete a survey, but it optimally leads to a second purchase by the member of a product or attendance at a meeting. For example, sending new members a dollars off voucher for their first purchase can help them engage the organization as both a member and a customer.

A member who makes a second purchase from an association before it is time for the first renewal is much more likely to renew than the non-buying member.

4. Upgrade Members - Ideally, association membership should not be a static product. Just as car companies have introductory models, family models, and luxury models to fit the changing needs and desires of buyers, an association is wise to offer members different service packages.

So I would put in place an upgrade (or up-sell) program to move members from one membership tier or product package to the next higher one. It might be as simple as moving student members to a professional membership, adding additional periodicals to the membership package, or including newly published books as a part of the membership.

5. Renew Members - The days of the three-part mailed renewal series has come to an end. Instead, effective renewal systems are now built on multi-media contacts using a combination of mail, email, phone, and fax integrated with a Web renewal tool.

One of the reasons that I would put an integrated program in place is because survey research reveals the startling reality of why most members fail to renew—they simply forgot! It’s not because members have become more forgetful. It is because the competition for their attention has increased.

The use of multiple media and higher frequency of contact helps to break through the clutter that prevents the renewal message from getting through.

6. Reinstate Members - The most likely member to come back to an association is the one who most recently left. So a reinstatement or “win back” program is also a key practice that I would put in place. Win back lends itself to an integrated media approach. Since there is an established business relationship with the former member that hopefully includes an email opt in, mail, phone, and email are all acceptable channels to use in communicating with a former member. The messages to lapsed members will highlight the outstanding content that the member has missed in the last few issues of the magazine and upcoming networking opportunities that he or she might want to take advantage of with a renewed membership.

The win back program provides an important secondary benefit. A portion of members will leave an association each year, but a well run win back program serves as a report card on the effectiveness of the renewal system. A successful program highlights a leaky renewal system. An unsuccessful win back program announces that your renewal program has captured all the members who still had a desire to stay with the association.

As you can see, my focus for all the steps that I would put in place is primarily results driven. My goal in building a membership program from the ground up would be to initiate a relationship and work to retain it. Clearly there are product, services and value issues with every association that need to be addressed. These are important, but beyond the scope of what I am trying to address here.

However, I find that in many cases associations provide great value. They enjoy a loyal and continuing membership. Marketing is the missing ingredient to membership success.

Please share the items that you would add or subtract from my list of what your membership marketing program would look like.

The Top Priority in Association Marketing

Over the last month a number of you have shared with me what the number one priority of an association marketing team should be. Thanks for those of you who have continued to me give feedback. I have enjoyed the discussion and shared some of the best comments. I wanted to add one more insight that I received from Melanie K. Johnson, Membership Program Manager, American Speech-Language-Hearing Association

She tells me that from her perspective the number one priority is to”Know what’s valuable to your members. There are so many competing forces seeking to grab your member’s attention. Direct your members to the products and services that are significant to them and articulate ‘what’s in it for me’.”

I like her thinking. In fact, in a post about member engagement I also wrote about the importance of providing value and reward to members. Thanks to everyone for contributing.