Never give up on Membership Renewals

Winston Churchill said, “Never, never, never give up.” And it would appear that as it relates to membership renewals, he may be correct.

In our Membership Marketing Benchmarking Survey, we asked “when does your organization finish renewal efforts” by months from expiration. We then cross tabulated this against their reported membership renewal rates.

The data appears to indicate that organizations that stop their renewal process earlier are more likely to have membership renewal rates under 80 percent. However, those that continue in their efforts to renew members are more likely to have membership renewal rates over 80 percent.

In fact, those who say that they “don’t stop contact” are 83% more likely to be in this higher renewal grouping than those who stop contact earlier.
But wait there is more.

Using the same cross tabulation, this trend also appears to be true when we asked in the survey how long a member is “graced” with the continuance of membership benefits after expiration. Organizations with longer grace periods tended to report renewal rates of over 80 percent. In fact, groups that grace member benefits three or more months are nearly three times more likely to have renewal rates over 80% (9% compared to 26.5%).


Client research that I have read independent of this study often suggests that one of the most common reasons for a member to lapse is that he forgot or did not get around to renewing. So it does not surprise me that those who keep working at restoring the relationship with a member end up keeping more members. Members tend to leave an organization for reasons of omission not commission.

So if you have members in your database who have not renewed, keep a perspective that they have not renewed “yet” and try to reconnect with them. Never give up.

11 comments:

Scott Oser said...

Hi Tony,

I have a lot of questions/comments on the gracing issue but I will hold off on many of them because there is no way you could have gotten to the answers via survey. My big question that I have for you is if you asked what the renewal rate was for people who were graced free membership. The numbers may be misrepresentative of reality if for example those associations that grace get a large percentage of the renewals without having to grace and lose most of the people they give "extra" membership to. I would also love to know if you asked if gracing was a strategic decision based on data and results or if it was done because it was always done that way.

Have a great weekend.

Scott

Tony Rossell said...

Scott -- As always you ask great questions. The survey questions were segmented by recruitment, engagement, renewal, and reinstatement, so the grace question was a follow up to questions related to the renewal process. I think it was pretty clear. Related to your second point, we tried to focus our questions on what an association actual practices were. The idea was to get an accurate picture of what a group did and then compare that to their reported new member input, renewal rate, and overall membership growth. We did ask a couple of questions related to marketing philosophy and goals, but I have not had a chance to go throught that data yet. By the way, these posts are all based on my take of the raw data. Adina Wasserman, my PhD staff research director, will actually be analyzing the data and writing the final report that we will distribute to survey participants. It promises to be very rich in insights. Tony

Belinda Busoli said...

I agree with the "Never GiveUp On Membership Renewals" sentiment entirely. Some of the most successful membership campaigns I've ever run have been into resigned members lists. The great thing is that resigned members don't need to know the history, services overview or the rest of the background. All they need to know is what's changed from when they were a member previously. That's a much more straightforward message to get across.

Tony Rossell said...

Belinda -- Thanks for your feedback. I agree with your comments on messaging. It is much easier with former members. By the way, maybe you can answer a question for me. I have found that I have a high proportion of my subscribers to this blog from New Zealand and Australia. Any thoughts on why this might be the case? I appreciate your insights. Tony

Belinda Busoli said...

Hi Tony

I have found the same kind of diversity within my subscribers as well

I have a monthly email bulletin, a membership LinkedIn group and a blog and they all have about the same proportions when it comes to subscribers - about 2/5 Australia & New Zealand; 2/5 UK & Europe and 1/5 US & Canada.

My theory is that outside of the US there aren't a lot of membership resources available. Therefore it is quite common for people to be very global in their pursuit of information as the theories, case studies and ideas will be relevant to most (in Western countries at least).

I've worked with associations in the UK, Europe, the US, Australia and New Zealand and found that many of the challenges faced are the same (member growth, retention, attracting younger members, growing sustainably, being effective on limited resources, etc). So it makes sense to use the global resources available.

What are your thoughts?

Warm regards
Belinda

jfollansbee said...

Hello Tony,

Your post on renewals is timely for our organization. We're preparing a membership solicitation and my board is interested in saving some money during these difficult times. I'm curious which variations on direct mail strategies have the highest response rate.

Currently, we're sending out a letter, a signup form, and a reply envelope, all in a standard No. 10 envelope. The letter gives the option of sending in a check or singing up online. Most research I've seen shows that this is the most effective strategy. However, it's also the most expensive, at least for our small non-profit.

My board has suggested a high-quality 4x6 post card with a suggestion to sign up online, essentially dispensing with the letter and printed form. One board member thought recipients would put the post card on their refrigerator as a reminder to sign up.

What does the research show about the effectiveness of the letter style versus a post card or some other direct mail strategy? Would any of your readers have any thoughts or experience to share?

Thank you in advance.

Joe Follansbee
Communications/Membership Director
Grays Harbor Historical Seaport Authority
www.historicalseaport.org

Tony Rossell said...

Belinda -- It sounds like the bottom line on your comments is that membership marketing is alive and well across the globe. I spent a number of days in Egypt speaking to groups from 15 nations on membership topics. It is good to see. Tony

Tony Rossell said...

Joe -- I would bet on using a #10 envelope with a personalized letter and reply form for my membership mailings compared to a post card. Over the years that is what my tests have shown is best. But perhaps some of the blog readers have more recent test data. It is great that you are asking the question and looking for other marketers test results. Tony

Scott Oser said...

Tony,

I completely agree. Unless you are using a standard postcard as a device to alert them that an email or something else is coming on which they will be able to renew or you have some incredible offer that they can get if they go to the web to renew I have always found a personalized #10 package to perform better than a postcard in renewals. That is especially true if you are including a pre-populated response form in your #10 package. One type of postcard that could work better than a standard postcard is a double postcard which does give recipients a way to respond.

Scott

Kathleen said...

Tony, what I've not seen in these comments is what I've found helpful to renewals. That is, that benefits stop at 90-days past due but the bills continue to 120-days past due. My experience is that about 75% renew within the 90-days and another 20-23% renew after that making it worthwhile and very cost-efficient to continue the bills past the 90 days. This was for anniversary renewals and no, the renewal date was not changed based on renewed date.

Just my 2 cents,
Kathleen Wilson

Tony Rossell said...

Kathleen -- Thanks for the comment. I agree with you and would maybe even take it a step further. Based on this research and on my experience, I might extend the renewal cycle beyond 120 days. The danger is that you get members in the habit of paying late. But the opportunity is that you may increase your renewals. I still find that when I market to former members of an association, I get a very high response rate. That means that people are leaking through the renewal program who still have a need or affinity for the organization. Tony