199 Ideas: Membership Recruitment and Retention

Last week ASAE and the Center for Association Leadership released their newest book, 199 Ideas: Membership Recruitment and Retention.

You will find it a very practical resource that membership professionals should keep handy and use as a checklist for the basics of membership marketing.

As the title suggests, 199 Ideas, is presented in a readable format as tips by topic area: Recruitment Basics, Where to Find New Members, How to Get Prospects to Join, and Retention Basics.

Here is a sampling of some of the tips:

1. “Tracking is everything. Want to really know what works for recruiting new members? Remember that all of your applications should be coded so that you can track where [they came from] (page 14).”


2. “New members can be found in lots of places, but the easiest sources are people who already know your association (former members, nonmembers who have attended you convention or purchased your services) or know your members (page 15).”


3. “By far, it [direct mail} is the most effective and fastest way to grow your membership, if numbers are what you’re after. Direct mail can be costly overall, but after you’ve been at it for a while (testing and analyzing, that is) you’ll be able to pick lists like a pro and you’ll learn which copy and offers will work and which won’t. This form of marketing allows you to pinpoint success – or failure -- with real numbers and thereby lets you control how much it costs you to get a member (page 19).”


4. “Every membership professional who engages in direct marketing must understand two things: 1.) that every mailing is an opportunity to test new ideas; and 2.) never ‘roll out’ . . . until you’re satisfied that the test works (page 22).”


5. “It’s important to have a well thought out renewal campaign with multiple touch points. You should consider a blended approach in your communications that includes email, direct mail, telephone calls, and web based tools )page 63).”[1]

As useful as the book is, I would take issue with a couple of the points made in 199 Ideas.

First, I think that recruitment basics chapter overemphasizes research and analysis. If all the research that was recommended in the book was done then there would not be time to actually do the recommended marketing. Often a better approach is to attempt some marketing efforts early on and let the market speak to you through the responses you get. Yes, research is good, but I also believe in the “just do it” approach to marketing.

Secondly, setting the expectation that your “response is usually somewhere between 2 and 5 percent (page 22)” for direct mail acquisition is unrealistic. Of course we would all love to mail 100,000 pieces of mail for $70,000 in cost to sell our membership at $200 in dues and get back $1,000,000 (5 percent return), but don’t promise that to anyone if you want to keep your job!

The book was developed by the Membership Section Council of ASAE and the Center. Key contributors to the book were Linda Brady of the International Society for Pharmaceutical Engineering, Tip Tucker Kendall from the Women’s Basketball Coaches Association, Michael C. McGough (a former colleague of mine) from the National Investment Relations Institute, and Miriam Miller from the United Fresh Produce Association.

By the way, the book also includes a "Share My Tip" form where you can contribute your thoughts for the next version of the book.

[1] 199 Ideas: Membership Recruitment and Retention, by ASAE & The Center's Membership Section Council, 2009, 88 pages.

We Don't Know What We Don't Know

BusinessWeek had a very encouraging article this month on Why It's Smart To Be Optimistic.

One quote in the piece jumped out at me from the inventor Thomas Edison who said, “We don't know a millionth of 1% about anything."[1]

Human nature seems to say that we know it all. But the wise course may be to humbly put ourselves in the place of being a learner.

As the old proverb says, “Whoever trusts in his own mind is a fool, but he who walks in wisdom will be delivered.”

[1] BusinessWeek, The Case for Optimism, August 13, 2009

Membership Marketing Benchmarking Final Report Now Available

We just publicly released the Membership Marketing Benchmarking Final Report for you to download. Only a registration on the site is required to get a copy.

I wanted to thank those who participated in our formal presentation of the report Monday, at the ASAE Annual Convention.

Please feel free to share the report with others in your organization. Post your comments here on this site and please let me know if you have any questions. I look forward to your thoughts and feedback. Here is the link.

This has been one of the more interesting projects that I have worked on in a long time. I hope you find it a help in your membership marketing efforts.

Monthly Installment Dues Billing: A Case Study

Everyone wants to increase their membership recruitment results and renewal rates and here is one tip to do just that – monthly installment billing of dues.

If you think about it, our society has moved to a month by month financial focus. Your cell phone, internet, car payment, and service contracts are paid each month. In fact, our likelihood to purchase these products would be greatly diminished if we were required to pay for the year in advance. We are also more likely to continue the services when the payments are automatically debited from our credit card or bank account.

However, most membership organizations do not offer the opportunity to pay monthly. A member is typically required to pay the full dues up front.

Over the past several years, we experimented with making monthly installment billing available to members. I wanted to share with you today a case study from one organization that has tried this program.

Let me start out by admitting that putting this type of program in place is an administrative challenge. Credit cards expire and have transaction fees. In the case of electronic funds transfers (EFT), bank accounts open and close. So this type of change will require staff time and programming time. The higher the dues payment, the more beneficial this type of program will be.

For my case study group, the idea to test installment billing was first raised as a method to increase response rates on membership acquisition mailings. Research showed that the $225 price tag for dues was an impediment for members to join.

So we built a head to head acquisition test for this organization. The control offer with the $225 price went to 37,640 prospects and the same package offering the additional option of an automatic credit card payment of $18.75 a month went to 37,623 prospects. The results were impressive. The control package generated 436 new members for a 1.16% response rate. However, the test package with the installment option produced 657 members fro a 1.75% response rate.

Clearly many prospects were more willing to join if they had the option to pay monthly.

The next question was how will members who select the monthly installment renew compared to members who pay up front. Our latest data reports on members who renewed on time. The on time renewal rate for members NOT on the installment plan is 55.7%. However, the on time renewal rate for members participating in the installment plan is 82.0%. The non-installment member rate will probably rise to 70% when late renewal payments are included. But even when late payments are included, a potential twelve point lift in renewals is a major improvement.

The bottom line for this organization is that making an installment dues option available to members has caused an increase in the work load for staff, but it has helped produce more new members, more revenue and a better renewal rate. It may be something that more membership organizations should test.

Let’s Connect at ASAE 09

I would enjoy meeting you if you will be attending the ASAE Annual Meeting in Toronto next week.

Here are some ways that we can connect.

First, my firm, Marketing General, Inc., will release the final report of our 2009 Membership Marketing Benchmarking Survey. If you would like a printed copy of the report, please stop by our booth – number 113 -- in the exhibit hall and ask for me. (Click here to read a summary of the Top Five Findings of that study).

Secondly, on Monday August 17, from 2:00 to 3:00 pm in room 802A of the Toronto Convention Center: I will be co-presenting an “un-session” on the report. The session is titled, How do You Compare? Benchmark Your Association against Industry Research in Membership, Marketing, Meetings and More.

In addition, Marketing General Inc. is pleased to again sponsor the Membership Section's Reception at this year's Annual Meeting. Join me from 5:00 to 6:30 PM on Sunday, August 16, in Ballroom A of the InterContinental Toronto Centre Hotel.

Finally, on Sunday August 16 at 1:30, I will be attending a session by my colleague Erik Schonher who will be part of a panel of membership executives and association CFOs to explore how to facilitate communication between the association's membership department and their finance department's leadership.

Schedule Your Membership Marketing Phone Consultation

The Washington DC area pretty much shuts down for much of August. That means my schedule is unusually free. I could take another vacation with my family, but I thought I would try something new this year and offer a free half hour phone consultation to my blog readers. I am setting aside time the week of August 3 to 7 for these conversations.

My hope is that I will be of help to your membership program and at the same time learn from what you are doing and get some more material for fall blog posts.

If you are interested, I have set aside some time slots for next week and will allocate them on a first come first serve basis.

You can connect with me either through LinkedIn or my contact information to the right on this blog.

I look forward to speaking with you.

Date Set to Present Membership Marketing Benchmarking Report

The past several weeks, I have been sharing my initial findings from our Membership Marketing Benchmarking Survey. I hope that you have found it helpful. We are now writing the final report.

We will be releasing the report at the ASAE and the Center for Association Leadership Annual Conference. If you are at the conference, you are invited to participate in a session that I will co-present on this research along with research from my friend, Sheri Jacobs, CAE. She will highlight her updated research on the state of the association economy. On this blog, I previously reported on the original edition of her research and I am sure her updated data will be very valuable.

We have titled the session: How do You Compare? Benchmark Your Association against Industry Research in Membership, Marketing, Meetings and More. The session is on Monday, August 17 at 2:00 in room 802A of the Toronto Convention Center.

If you are one of the more than 400 survey participants, you are scheduled to receive your personal copy of the research report the first week of August. For those who did not participate, we will provide copies to those who attends the session.

This presentation is done with the permission of ASAE, but is designated as an "unsession". It will be promoted exclusively through word of mouth and social media. So feel free to jump the fence to attend and share the date and time with others.

A Wake-Up Call for Associations

Most associations that I interact with view competition as coming from the association next door. Going forward, I think that it will most likely be coming from a for-profit company. And in my mind, the best way to protect and grow your association before this happens is to build relationships and connections through membership with your market.

Companies moving into the traditional association marketplace are eager to fill any vacuum that they can profitably find in the markets you serve.

That’s why developing or hiring expertise in membership marketing is more important today than ever for associations.

Here is one example, Merion Publications; the publisher of ADVANCE Newsmagazines. They provide a magazine, current job listings, education/events, job fairs, and communities to professionals in the following fields.

Nurses
LPNs
Imaging & Radiation Oncology
Directors in Rehabilitation
Physical Therapists & PT Assistants
Occupational Therapy Practitioners
Speech-Language Pathologists & Audiologists
Audiologists
Long-Term Care Management
Respiratory Care & Sleep Medicine
Administrators of the Laboratory
Medical Laboratory Professionals
Health Information Executives
Health Information Professionals
Nurse Practitioners
Physician Assistants
Healthy Aging

I do not want to communicate that there is anything unethical with companies moving into the realm traditionally owned by non-profits. They see a market opportunity and have taken advantage of it using the marketing and sales expertise that they have honed over the years.

The questions associations should ask themselves are: How well prepared are we to deal with for-profit competition? Should this be a wake up call for our association? Is business as usual sustainable?

As I have shared on this blog, building the membership relationship is driven by making prospective members aware of who you are, actively recruiting these prospects, engaging new member in the organization, and effectively renewing them.

Agree or disagree, please let me know your thoughts on this.

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.

Retention Rates by Membership Size and Association Type

The other day a comment was left on one of my posts requesting more detailed information on renewal rates based on membership size and also on association type. So here are a couple of tables on these items.


For those of you who follow the association industry closely, you will not be surprised that trade associations show higher renewal rates compared to individual membership associations. Associations with smaller memberships also report better renewal rates.

As always when I report on renewal rates, I add the disclaimer that comparing renewal rates is a challenge because there are many variables from association to association including business rules, dues amounts, and marketing environments.

Top 10 Methods to Engage New Members

Part of my thinking in developing the Membership Marketing Benchmarking Survey was simply to find out what association marketers are doing. So it has been interesting going through over 400 responses to see all of the activities that are taking place in membership. This makes the seventh post on what I have found.

One question that we asked in the survey was to list all of the communications methods that were in use to engage or onboard new members. Here are the top ten as reported by survey respondents starting with the most used.

In addition to the most used methods, some of these engagement techniques also correlated with organizations that reported higher renew rates in the survey. (Please note, I am not saying that they caused higher renewal rates, but that they were more likely to be practices of groups that reported better renewal rates.)

The methods that correlated with higher renewals are what I would call “high touch’ contacts and include mailed welcome kits, volunteer or staff welcome calls, new member surveys, and a new member reception.

What is also of interest to me is that the associations with larger membership counts were the more likely to report on using volunteer or staff calls to new members compared to other sized groups. I had assumed that it would be associations with smaller memberships who could handle these personal calls.

Methods that were very rarely used to engage new members were telemarketing welcome calls, early bird or “At Birth” renewals, and a using custom new member renewal series.

Thanks for reading and stay tuned for additional Membership Marketing Benchmark Survey findings.

How Associations Can Create an Indispensible Brand

Two of my colleagues -- Bill Jerome and Page Stull -- have just released a white paper on branding that I have found very helpful. The title is: “How Associations can create an Indispensible Brand and Why Most Don’t”

The paper defines how associations can “build a strong brand by outlining the power of a brand, the mistakes associations make in developing their brand, the key measurements that lead to the strongest brand for an association, and the appropriate steps to identify and promote an association’s unique and ultimate brand.”

I particularly like the member centric view of brand that the paper presents. To assess your brand, the paper asks how your members would answer these questions.

“What does the association stand for that is important to me?”

“What can I do now that I could not do before I became a member?”

“What does this association do that no other association can do?”

“How does the association fulfill its mission so that I can easily enjoy all of the benefits I need?”

You can download a free copy of this whitepaper and others produced by my company using this link. If you have questions on branding, you can reach Bill Jerome through LinkedIn.

And the Best Membership Recruitment Offer Is . . .

In direct marketing there are three traditional keys to success: list, offer, and copy. A good promotion, for example, should include some type of offer to highlight why the prospect needs to respond now.

So as part of our Membership Marketing Benchmarking Research, we asked what recruitment offer was most effective in getting the most new members. We also cross tabulated their answers with renewal rates.

Respondents reported that the best recruitment offer was a “discount on first year dues”. This did not come as a surprise to me, because I have tested a discount many times and with a variety of organizations. It has consistently tested well.

But here is a BIG SURPRISE. Some marketers claim they do not use a discount because it will hurt renewal rates. However, the research shows that of those who offered a new member dues discount 75% had renewal rates of over 80% and 25% under 80%. This outperforms the overall respondent base with 68% having renewal rates over 80%. In other words, new member discounts actually correlate with higher membership renewals.

Here is how respondents report the “most effective offer in getting more new members”.

Direct Mail is Tops for Membership Recruitment

What marketing channels are most effective in new membership recruitment?

Based on responses from our membership marketing benchmarking survey, direct mail still tops the list with 31.7 percent of respondents saying it was the most effective source for attracting new members.

Here are the channels that were rated as top performers to get new members.


Interestingly, the following registered at less than one percent: Paid Search Advertising, Online Ads, Public Relations, Social Networking, and Print Ads.

I have always maintained that membership is primarily a “push” product. It must be proactively sold. So it is interesting that highly targetable and direct to customer methods are rated as the best in recruiting new members from this research.

Here is some additional data that you might find of interest. The Research Brief Blog reports that "Direct mail's share of total advertising spending has been on a strong upward trend for most of the past 17 years. Since 1999, the direct mail share has risen steadily reaching 22% in 2008. Direct mail has maintained its large ad share even with the introduction of new, fast-growing ad markets such as the Internet."

High Membership Retention Rates Correlate with Growth

In looking at our membership marketing survey data, the power of keeping members correlates with not only overall membership growth for an association, but also with the growth of new member input, which actually comes as a surprise to me.

Here is what I found.

As I noted yesterday, 47% of responding associations reported overall membership growth over the past year. And of those reporting growth, 77% had renewal rates of 80% or better.

While of the 36% who reported a drop in overall membership over the past year, only 55% reported renewal rates of 80% or better.

What is counter intuitive is that not only are higher renewing associations more likely to be seeing overall growth, but higher renewing associations are also more likely to be seeing a higher percentage increase in new member input. This is counter intuitive because typically new members renew at a lower rate than longer term members, so you might expect that groups adding more new members might see lower renewal rates.

Of the 54% of associations who reported a growth in new member input over the past year, 71% of them had renewal rates of 80% or better. While of the 22% who reported a decline in new member input, only 47% of them had renewal rates of 80% or better.

Overall, here is how associations reported their current renewal rates.

By the way, I do present these renewal rates with one major caveat. Comparing one association’s renewal rate to your association is not an exact science because each association operates in a different environment and uses different business rules to count a renewed member. So I am using this renewal data in a broad sense to highlight that renewal rates are correlated to both overall membership growth and even new member growth.

What Research Says about Marketing during a Recession?

As a follow up to today’s post about associations growing membership during a recession, I thought a recent article in The New Yorker made the same point very well looking at the for profit world.

The article looks says “numerous studies have shown that companies that keep spending on acquisition, advertising, and R. & D. during recessions do significantly better than those which make big cuts.”[1]

The article is worth reading and could be useful in arguing against the budget cuts that are being imposed on so many of you who I talk to about this. Let me know what you think.


[1] James Surowiecki, Hanging Tough, The New Yorker, by April 20, 2009

Associations Report Continued Membership Growth

Is membership growth a possibility even in today’s economy? Our membership marketing benchmarking data would indicate that it is.

As you may recall, I am analyzing data from over 400 associations that participated in our membership marketing benchmarking survey this spring. We inquired about growth over the past year and over the last five years.

Here is what we are finding. Over the past year, 46% of associations are reporting that they have seen their total membership grow. While 16% have remained the same and 35% have seen a decline in membership numbers. The numbers do not add up to 100 because some respondents were not sure whether membership grew or declined.

The numbers show a stronger picture when looked at over the past five years. During this time period, 60% of respondents reported growth. And 26% of the associations had membership growth of over 10%. At the same time, 8% reported no change and 26% reported a decline.

In addition to seeing strong growth in overall membership, the data indicates that new member input has also been strong over the past year with 54% reporting an increase in new member input. While 22% have seen a decline and 24% have remained the same.

Although we did not ask for trend data on renewals, we might infer from the data that since new member input is up over the past year at a higher rate than overall membership growth, renewal rates must be lower on average for associations.

Membership Marketing and the Web

I have begun the review of the raw data from the Membership Marketing Benchmarking Survey that we launched this spring. We had over 400 survey participants.

From my initial review of the data there are many surprises and confirmations of what I expected.

My first surprise was how little associations are using the web opportunities to acquire members compared to other membership marketing channels.

We asked participants to highlight what channels they use to get new members and how they allocate their membership marketing budgets over these channels. The results showed that some commonly used web channels for acquisition see limited very use by associations and make up a very small portion of their budgets. For example:

• Only 8.3% of those who responded use search engine advertising to acquire members and this channel only made up 0.29% of membership marketing budgets.
• Only 12.2% use banner ads and links on others web sites to market membership and this only made up on 0.13% of the survey participants’ overall membership marketing expenditures.

Based on what the opportunities are using these channels, associations are under utilizing these tools to reach out and attract members. I suspect that these numbers will grow dramatically in the future.

On the other hand, 35.2% are using social networking to help attract members. Still this only makes up 0.78% of membership marketing budgets. Interestingly, 26.8% of associations who report using social media to attract members reported a decline in new member acquisition compared to 21% of the total respondents.

Does this mean that necessity is the mother of invention and these groups are giving social media a try or that social media diverts resources from more productive acquisition opportunities?

The vast majority of respondents -- 84.8% -- use their association website and this only makes up 3.2% of membership marketing budgets.

By the way, just a reminder that the world is changing and we need to keep pushing the envelope. Here is a post card promoting my grandfather’s Chrysler dealership. He is pictured on the left.

Membership Development from the Ground Up

Over the years, just about every membership marketing program has been influenced by tradition, internal politics, or database limitations.

So it was interesting when I met the other day with a talented marketer who joined a group that presented him with a clean slate for membership marketing. Since almost nothing was in place, he had to build the membership marketing program from the ground up.

It got me to thinking, what if I was in the same place? What if my only mandate was to grow membership based on sound marketing principles? What would my membership marketing program look like?

Well here is my take on the programs that I would put in place to get membership moving.

1. Build Awareness - My first action would be to harness the web. Awareness is the first step to any purchase. And the leading source for information for most people has become the Web. So membership development begins with using search engine optimization, search engine advertising, ad networks, and social media to help people who are seeking solutions provided by an association to find me. Tracking traffic sources and the effectiveness of keywords will help me identify the people and the value that my prospects are looking to find.

Anyone coming to my web site would be encouraged to register for a free association newsletter. This allows me to add the prospect to my database.

2. Recruit New Members - The fastest growing membership associations still rely on test-driven membership acquisition campaigns as the workhorse for gaining new members. Ineffective membership recruitment is the single biggest marketing reason for declining or stagnant memberships. So my second step would be to establish regular mail and email promotions to both house and outside lists, And because these promotions will typically be the largest outreaches that the association will do, they statistically lend themselves to head-to-head market tests. Testing will tell me the best lists, offers, messages, and packages to use going forward.

3. Engage New Members - Once a new member joins my association, he or she becomes the most likely member not to renew. Almost all associations show first year members as the lowest renewing cohort. The first year is therefore referred to as the conversion year for new members.

So once I get a flow on new members coming to the association, I would establish a conversion program. This type of effort is a multiple step orientation that helps the member to become engaged in the association. A sound conversion program certainly orients the member to the products, services, and opportunities provided by an association. It also should generate a second interaction with the member. This might be as simple as having the members complete a survey, but it optimally leads to a second purchase by the member of a product or attendance at a meeting. For example, sending new members a dollars off voucher for their first purchase can help them engage the organization as both a member and a customer.

A member who makes a second purchase from an association before it is time for the first renewal is much more likely to renew than the non-buying member.

4. Upgrade Members - Ideally, association membership should not be a static product. Just as car companies have introductory models, family models, and luxury models to fit the changing needs and desires of buyers, an association is wise to offer members different service packages.

So I would put in place an upgrade (or up-sell) program to move members from one membership tier or product package to the next higher one. It might be as simple as moving student members to a professional membership, adding additional periodicals to the membership package, or including newly published books as a part of the membership.

5. Renew Members - The days of the three-part mailed renewal series has come to an end. Instead, effective renewal systems are now built on multi-media contacts using a combination of mail, email, phone, and fax integrated with a Web renewal tool.

One of the reasons that I would put an integrated program in place is because survey research reveals the startling reality of why most members fail to renew—they simply forgot! It’s not because members have become more forgetful. It is because the competition for their attention has increased.

The use of multiple media and higher frequency of contact helps to break through the clutter that prevents the renewal message from getting through.

6. Reinstate Members - The most likely member to come back to an association is the one who most recently left. So a reinstatement or “win back” program is also a key practice that I would put in place. Win back lends itself to an integrated media approach. Since there is an established business relationship with the former member that hopefully includes an email opt in, mail, phone, and email are all acceptable channels to use in communicating with a former member. The messages to lapsed members will highlight the outstanding content that the member has missed in the last few issues of the magazine and upcoming networking opportunities that he or she might want to take advantage of with a renewed membership.

The win back program provides an important secondary benefit. A portion of members will leave an association each year, but a well run win back program serves as a report card on the effectiveness of the renewal system. A successful program highlights a leaky renewal system. An unsuccessful win back program announces that your renewal program has captured all the members who still had a desire to stay with the association.

As you can see, my focus for all the steps that I would put in place is primarily results driven. My goal in building a membership program from the ground up would be to initiate a relationship and work to retain it. Clearly there are product, services and value issues with every association that need to be addressed. These are important, but beyond the scope of what I am trying to address here.

However, I find that in many cases associations provide great value. They enjoy a loyal and continuing membership. Marketing is the missing ingredient to membership success.

Please share the items that you would add or subtract from my list of what your membership marketing program would look like.

The Top Priority in Association Marketing

Over the last month a number of you have shared with me what the number one priority of an association marketing team should be. Thanks for those of you who have continued to me give feedback. I have enjoyed the discussion and shared some of the best comments. I wanted to add one more insight that I received from Melanie K. Johnson, Membership Program Manager, American Speech-Language-Hearing Association

She tells me that from her perspective the number one priority is to”Know what’s valuable to your members. There are so many competing forces seeking to grab your member’s attention. Direct your members to the products and services that are significant to them and articulate ‘what’s in it for me’.”

I like her thinking. In fact, in a post about member engagement I also wrote about the importance of providing value and reward to members. Thanks to everyone for contributing.