Today's focus is on the critical area of keeping your current members by
improving your renewal efforts.
Even small improvements in the renewal rates for an organization
can have a dramatic impact on the overall membership. For example, going from the average
individual association renewal rate of 79% to an 85% rate, increases the
average tenure of your membership from 4.76 years to 6.66 years. That’s a 40% jump in tenure for a 7.5% lift
in renewal rates.
Here are some adjustments you can make in your renewal
program that will pay immediate dividends.
1. Increase the Frequency
of Contact -- Research shows that associations with better-than-average
renewal rates have between seven and 15 renewal contacts in their system. However, you can measure the impact of
increased touches on your own. Simply
add one additional mailed notice to your current program and divide the cost of
this additional step by the number of renewing members. It will almost certainly be less expensive renewing
that last member than acquiring a brand new member.
2. Start Renewals
Earlier -- When the renewal series begins also has an impact on renewal
rates. The most effective series starts more than three months before
expiration. To avoid the inevitable member
complaints of why early renewals are being sent, try including an
"early bird" special offer to reward those who respond early. Like it or not, there is a lot more
competition for our members’ attention, so giving them an early warning of
their dues payment coming up makes a difference.
3. Offer Members
Payment Options – If your members pay their dues out of their own pocket,
making automatic credit card renewal plans and installment options available can
dramatically improve renewal rates. One
association reports increasing on-time renewal rates using an installment
option from 55% renewal for non-participants to 82% for participants.
4. Use the
Information in Your Database – The “finger prints” of your members’
behavior is captured in the form of data throughout your organization. Properly analyzed, this data can tell you who
is likely to renewal and who is at risk.
For almost any group, usage of the website, opening emails, and product
and service purchases are a positive predictor of renewal. None usage by a member may require an
intervention even before the renewal program begins to help communicate the
value of membership.
5. Use
Personalization Print Technology – The question some will ask at this point
is how do I pay for these additional renewal strategies? One solution is to move to a template renewal
notice and use personalized laser printing to vary and customize your
message. This should result in much
lower direct mail production costs. Just
like the laser printer in your office, you can print copy, graphics, and member
specific information on a blank renewal form each month. This variable printing allows for savings
through postage presorts, less inventory storage, and the complexity of having
your lettershop insert different renewal notices into different envelopes.
It is my observation that for many membership organizations
renewal programs can fall into a rut.
The same program is run year after year.
Even worse, some programs continue to decrease the frequency of mailings
to save costs and rely more on email and then they are surprised when renewal
rates falter.
That is why it is important to take time each year to re-evaluate
your renewal communications and the results that they are producing and
evaluate changes that can help you pop your numbers. Sometimes simple adjustments can produce
highly profitable results.
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