So Why Test in Membership Recruitment?

After my last post, you might say to me, “So what’s wrong with not doing market testing in my membership recruitment program?”

My answer is, "If you don't shoot, you can't score." 

Let me share an example from a recent test that we conducted with one of our clients. For this client, we conducted a price test by splitting prospective members receiving a membership solicitation in half. The control group received a direct mail package with the normal $230 annual membership offer. The test group received the exact same direct mail package, but the with a $31 discount taking the price down to $199.

The final test results were significant. The control group achieved a .35 percent response rate producing $805.00 for each thousand pieces that we mailed. The test group achieved a .67 percent response rate producing $1,333.30 for each thousand pieces that we mailed. The total revenue for the control group came to $24,150 while the total revenue for the test group came to $39,999. So the test group produced both more revenue and more members.

The question often comes up whether the discounted price members will renew at the same rate as those who paid the full price. My experience is that there will be a slightly lower renewal rate from those who took the discounted offer, but not nearly enough to offset the increase in the number of new members.

But whether you choose to discount or not, the more important point is that it pays to conduct statistically valid market tests. The 80 percent of associations that do not do testing in their membership marketing efforts are missing out on better returns.

Disturbing News on the Practice of Membership Marketing

Much of the data reported in the recently released 2012 Membership Marketing Benchmarking Report was very encouraging. Many organizations are seeing growth in membership and using great tools to recruit, engage, and retain members.

But answers to the question, “What types of analysis do you use to measure the effectiveness of your membership marketing campaigns?” raise lots of concerns for me.

The responses reveal an alarming lack of using even the basic marketing measurement tools available. As the chart below highlights, of the 667 organizations answering the question, less than half track response rates to their marketing efforts. Only 20 percent conduct split marketing tests. And a full 40 percent use no marketing measurements at all.

Why is this? In an age when we have computers on our desks and big investments in websites and databases, it seems fundamental practices that have existed for years in marketing are not being used.

To quote Claude C. Hopkins, who wrote way back in 1923, from his book, Scientific Advertising: “The time has come when advertising has in some hands reached the status of a science . . . . We learn the principles and prove them by repeated tests. This is done through keyed advertising by traced returns . . . We compare one way with many others, backward and forward, and record the results. When one method invariably proves best, that method becomes a fixed principle” (NTC Business Press).

An organization that does not track responses, conduct tests, understand the lifetime value of members, and understand the buying patterns of members in their database is sub-optimizing its effectiveness and the long-term growth potential.

Seven Levers to Increase Membership Recruitment

Where do you start if your supervisor or board tells you to increase the number of new members coming into your organization?

Usually it is best to look at a broad array of options first and then determine what fits your situation the best. Here are seven strategic levers or opportunities to explore in order to increase your new member recruitment efforts.

 1. Enhance the Value of Membership -- Finding a need and meeting it is the foundation of marketing. If you can provide an indispensible new product or service as part of your membership offering, you will increase the response to your current promotions.

 2. Deploy Market Penetration PricingPrice is one of the four P’s of marketing., so it is a legitimate and useful tool to explore. To grow the number of new members at a rapid rate, a sharp decrease in the price can be effective.

 3. Increase Volume (Quantity) of Recruitment Efforts – From my observation, many membership organizations under budget and do not reach deep enough into their markets for potential members. If you have strong returns from your recruitment efforts, you probably are not reaching your full market potential.

 4. Add New Marketing Channels – Many organizations get locked into one or two marketing channels like email or sales calls and forget about other options like direct mail, telemarketing, and online. When integrated a combination of channels can be particularly effective.

 5. Test New Lists, Offers, and Creative – Without regular testing of new lists, special offers, and new messages and graphics, a membership recruitment program is sub-optimized.

 6. Expand to Related or Ancillary Markets – Thinking creatively about what other market segments might be appropriate for your membership offer can help to jump start recruitment. This is known as a market expansion strategy.

7. Increase the Frequency of Touches to Top Prospects – For almost every organization, there is a core of prospective members who respond at a very high rate. Aggressive membership marketers reach out to these prospects much more frequently over the course of a year and see strong returns.

Each of these strategies has its strengths and weaknesses. For example, lowing prices or reaching new markets can potentially negatively impact renewal rates. However, if the overall membership is growing at a faster pace, then these changes may make good sense.

 If increasing new member recruitment is your goal, I encourage you to step back and look at these options. One of them or some combination of them is likely to be the solution that helps advance your membership.