3 Tips on How to Improve the Presentation of Your Membership Product

Whether it is a meal at a restaurant, a theatric performance, or a piece of art, presentation is important.

How membership is presented is also important when promoting to prospective members.

So when I came across some behavioral concepts from the consumer market in the Mckinsey Quarterly magazine, I thought that they could be applied to how we market and present our membership product.  Here they are. 

1. Offering payment terms – Many organizations find that adding a bill-me to a membership promotion or offering installment billing can improve responses. In fact, over 45% of associations report that they now offer a dues installment payment option. Similarly “retailers know that allowing consumers to delay payment can dramatically increase their willingness to buy. One reason delayed payments work is perfectly logical: the time value of money makes future payments less costly than immediate ones. But there is a second, less rational basis for this phenomenon. Payments, like all losses, are viscerally unpleasant. But emotions experienced in the present—now—are especially important. Even small delays in payment can soften the immediate sting of parting with your money and remove an important barrier to purchase.”1.

2. Offering a tiered membership with lower and higher priced options – I have commented in the past on the benefits of developing a tiered (or multi-level) membership product. These tiers allow a member to pick the best value for themselves and allow the organization to maximize its share of wallet. As an example from the retail world, “many restaurants find that the second-most-expensive bottle of wine is very popular—and so is the second-cheapest. Customers who buy the former feel they are getting something special but not going over the top. Those who buy the latter feel they are getting a bargain but not being cheap.” 2.

3. Bundling diverse additional services into a membership package – The opposite problem of having only one membership category is having a membership with lots of choices like interest sections, local chapters, and optional periodicals. This complexity can actually reduce response rates. In fact, “reducing the number of options makes people likelier not only to reach a decision but also to feel more satisfied with their choice.”3.

Trying new ways to present membership really comes down to making the buying decision easier for a prospective member. We make it easier for them to buy if we offer payment over time and if we give a member a product that both meets a member's diverse needs, but also is not too complex or cumbersome to purchase.

What other suggestions do you have to better present membership in your organization?

1. Ned Welch, A marketer’s guide to behavioral economics, McKinsey Quarterly, February 2010.
2. Ibid.
3. Ibid.

3 Membership Marketing New Year’s Resolutions

The start of the New Year is a good time to step back and look at the big picture and put in place some initiatives that can really make a difference. So here are three resolutions that you may want to make for a more successful membership year in 2011.

1. Adequately Fund Membership Marketing – Just like putting money into retirement savings, investing in membership pays dividends for years to come. A new member produces a long term income stream. However, as I meet with membership organizations, I am continually surprised at the budgets that have been set aside for marketing. Almost every organization wants to grow their membership, but rarely do I see budgets that are tied to the lifetime value of a potential member. Lack of funding means many organizations are leaving money on the table and missing their potential by not crunching the numbers to determine how much they should be investing in getting more members.

2. Initiate and Cultivate Potential Member Relationships – We find that a promotion sent to a prospective member who provided an opt-in to receive more information from an organization will garner up to four times the response than the next best list. To gather this opt-in, we offer free content from our clients in exchange for contact information (an opt-in). The content offer may be presented through SEM, online ads, or to visitors to the organizations website or social media sites. The key is to initiate the lead and then cultivate the relationship.

3. Test and Track Membership Marketing Efforts – If you want to double or triple your marketing returns over the next year, then setting up marketing tests with a control and test cell is your best opportunity. You can test what marketing list is most responsive, what message is most compelling, and what offer best encourages action. To test you need to code the outbound marketing pieces and track the responses as they are returned. To capture un-coded responses, match back returns to your promotion file.

These membership marketing resolutions are summed up well by a comment from one of my survey respondent who wrote:

“When you actually do a recruitment campaign, they join. When you engage with your members, they stay. When you analyze the data, you find a nugget of information that can change all of your preconceived ideas.”

What are your membership marketing resolutions for 2011?

Can We Talk? Join an Interactive Discussion on the Membership Marketing Benchmarking Report

For those readers located in the Baltimore/Washington metropolitan area, I wanted to invite you to attend an interactive session that I am leading for the Maryland Society of Association Executives discussing the results from our Membership Marketing Benchmarking Report.

The meeting is on Wednesday, January 12th. If you have read the report and have comments or questions or simply want to learn more about the research, you can sign up using this link.

How Long does the Average Member Stay with an Association?

There is actually a formula to calculate how long members on average continue their membership. It is called calculating the Average Tenure of a member.

Here is how you can calculate this for your membership. Take the lapse rate of the membership (the opposite of the renewal rate) in a decimal form and divide it into the number 1. So a membership organization with an 80% renewal rate would have a lapse rate of 20% and an average tenure of five years (1/.20= 5).

Another way of looking at this calculation is if you have a 20% lapse rate, your membership will turn over every five years.

So what would be the “average”, Average Tenure for membership organizations?

In our 2010 Membership Marketing Benchmarking Report with over 400 participating associations, our average renewal rate was 83%. So this would put the Average Tenure of a member at 5.88 years for the participating organizations.

Please be aware that this is an average for the participating organizations. Some reported renewal rates less than 50% and others more than 90%.

Knowing the Average Tenure of your membership is a crucial data point to use in marketing planning and making long term budget projections.