Four Reasons Why Thriving Membership Organizations Stop Growing

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.

Ten Top Tips from the Membership Marketing Benchmarking Report

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.

ASAE 2010 Marketing & Membership Conference

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.