Once again in our 2013 Membership Marketing Benchmarking Research, we investigated the practices around increasing membership dues rates.
Of the 680 association respondents that answered these dues related questions, 23.5% reported that they have or plan to increase their dues rates this year. The industry segments most likely to be raising dues include organizations that identified themselves as Chambers of Commerce. The industry segment least likely to be raising membership dues are Arts, Cultural, and Museum based associations.
A total of 31% of trade associations report that they are raising dues in 2013 compared to 21% of individual membership organizations. Also associations with budgets of over $5 million dollars are more likely to be putting a dues increase in place. And organizations that report annual renewal rates above 80% or better were more likely to be raising dues compared to those with lower renewal rates (26.7% compared to 18.5%).
How much are organizations raising dues levels? 51% of respondents said that their last dues increase was between 1 and 5% and 24.7% had increases of between 6 and 10%. The vast majority of associations (62.6%) report that they do not raise dues on a regular basis, but only on an “as needed basis”.
From our research the lesson has been pretty consistent over time that most associations can easily implement modest dues rate increases without adversely impacting their membership.
The final benchmarking report will be released in several months and participating associations will receive a printed edition of the complete report.
As we deploy new and exciting marketing channels, it is often good to step back to be sure that we are covering the basics. That’s why I found an article by Kevin Mills, the Director of Membership for the National Legal Defense Association, a good reminder.
In the April issue of Marketing Advents, Mills wrote an article titled, Direct Mail: The Foundation for Marketing Success. “With more than 15 years of experience developing marketing strategies to increase membership and member benefits,” Mills says, “I have the most confidence in direct mail … Direct mail provides legitimacy to our organization and its cause, and provides the vehicle for email and social media campaigns to be successful. Again, using other marketing tools is obviously a necessity in today’s technology-driven culture. But, in laying the foundation for marketing success, the results are best when we put together a comprehensive marketing strategy that begins with direct mail.”
He adds “that even our younger customers are responding to our direct mail efforts.”
Mills conclusions were confirmed in the 2013 Membership Marketing Benchmarking research. Organizations that used direct mail in renewal efforts were more likely to have renewal rates of over 80%, have increased membership in the past year, and have increased or maintained their renewal rates. Additionally associations with 20,000 or more members affirmed that direct mail was the most effective marketing channel for membership recruitment.
What’s the bottom line? In my experience, direct mail remains an effective and scalable channel to help organizations get and keep members. Used properly, it is highly targetable, track able, and affordable. If it is not in your marketing portfolio of tools, it probably should be given a try.
The 2013 Membership Marketing Benchmarking data shows that 24% of responding associations reported rapid growth in membership over the past year. My definition of rapid growth is growing at a rate of 6% or better.
So today, I took a look at some of the characteristics of these growing associations. Here is what I found.
· Associations that describe themselves as offering both individual membership and organizational membership are more likely to have rapid membership growth compared to individual or trade groups (28% to 23% to 21%).
· Associations with 20,000 members or more are more likely to have rapid growth (35%).
· Associations representing healthcare, hobbyists, financial services, and professional services markets are more likely to have rapid growth.
· Associations with an increase in new members over the past year are more likely to have rapid membership growth (33%).
· Associations with an overall renewal rate of less than 80% are more likely to have rapid membership growth compared to organizations with an 80% or greater renewal rate (27% to 22%).
· Associations with an increase in renewal rates over the past year are more likely to have rapid growth in membership (39%).
· Associations with first year new member renewal rates of between 60% and 79% are more likely to have rapid membership growth (28%).
This topic probably warrants going deeper into the data to look at specific tactics that correlate with rapid membership growth. But for now, here is one finding that the data may support. It may be more important to add new members into the membership funnel than to renew them.
Groups with somewhat lower overall renewal rates and lower first year renewal rates still had rapid growth. This may be because a larger portion of their membership is made up of new members who characteristically renew at lower levels than do long term members.
Please feel free to share your theories in the comments section below.