By Harold Maurer and Barbara Armentrout
For most of us entrenched in the day-to-day work of association membership and marketing, it can be tricky if not impossible to take the time to step back and see the forest for the trees, by which we mean remember the strategic framework giving the why we are doing what we are doing. After all, we've got renewals to pull, mail, and analyze, new member recruiting packages to write, mail, and analyze, as well as retention efforts, conference marketing, foundation appeals, on and on.
Here are five tips on membership marketing aimed at helping an association succeed in finding, acquiring, retaining, and winning back members.
Tip #1: Invest in Membership
"We tried direct mail—or email, or internet advertising, or billboards—but it didn't work because we lost money doing it." Have you ever heard yourself saying or hearing "it didn't work" as the reason your association stopped doing something, and then they wonder why your membership numbers are trending downward?
Let's compare your membership base to your house or condo. If you invest $15,000 in renovating your kitchen, your real estate agent will increase your selling price by at least $25,000—but you'll lose money by doing it. Is it a good idea to invest the money? Of course it is, because you net more in the long run than you spent (plus you get a great kitchen to enjoy). Does it make sense to invest in a new outfit every once in a while or comfortable shoes that you'll wear during the next three Annual Meetings? Of course; intentional investments make sense, and you will earn interest on your investment every time you wear the suit or shoes for years to come.
Back to the kitchen remodel, if you stay in that house for another five years, you will enjoy your investment and still enjoy the financial bump later during resale. That's a lot like investing in a new member who joins now, becomes an active volunteer, attends your Annual Meeting every year, buys books, attends webinars, and perhaps enjoys the experience so much that your new member eventually helps recruit other new members. Is that worth the up-front investment to identify, recruit, and retain that new member? Of course it is.
Approach your membership program knowing that many highly successful association recruiting/acquisition programs lose money on the initial steps. Their programs succeed because they understand that members are an investment, not a purchase. How much money a member is worth over time is far more important than first-year dues. Membership campaigns are investments that pay for themselves over the life of a member.
Tip #2: Anchor Your Priorities
The Direct Marketing Association performs and shares studies regularly, so we know after more than 50 years of measuring that the success of a marketing campaign is roughly 50% in the accuracy of targeting, 35% in what is being promoted, and 15% in the creative package.
Many organizations spend time agonizing over the details (such as what color, what font, what graphic) even though those details will impact, at best, 15% of the result.
Accurate targeting, usually summed up as the mailing list, is responsible for 50% of your success or failure, whether you are talking direct mail, email, online, or social media channels.
Associations that are successful in growing the membership base know who they attract and what those prospects want from them. Don't squander time on creative until after you have nailed down the best targeting and know you are making the best offer.
Tip #3: Be Steady and Sure
Often, after a failed attempt at marketing (see Tip #1), an association will delay launching the next campaign until the need for new members is critical, often just before annual budgets are due. This delay inevitably leads to two rather nasty results. Keep in mind that a marketing campaign that is pushed out in a frenzy (without the benefit of strategic planning and competitive bidding of services) usually pulls lower response numbers at higher costs per member.
The results (reported as dues dollars and response dashboards) usually cannot be verified and processed quickly enough to offset the gap in end-of-year member revenue that drove your frenzied activity. But of course expenses will be booked, creating a lopsided picture if you examine results year-by-year.
This push at the end of the fiscal year can strain program budgets and the overall financial health of the organization and inadvertently puts essential programs in jeopardy. The secret is to set a course of campaigns over the upcoming year, and stick to it. Research and experience show that associations need an average of five to six campaign touches a year to acquire a new member. One or two campaigns are simply not enough to acquire a significant, steady influx of new members.
Tip #4: Integrate to Win
Direct mail doesn't work! Email doesn't work! Search marketing doesn't work! Depending upon your experience and your organization, one or all of these may be true. Here's what we know does work: Integrate all the media channels that work best for you into your campaigns. Like the Beatles, Monty Python, Lady Antebellum, and Imagine Dragons, the whole will be greater than the sum of its parts. Multiple studies and analyses reveal that an intelligent mix and sequencing of touches from various media, i.e., combining direct mail with pre- and post-emails and Facebook advertising, will outperform any single effort.
When you integrate your campaigns, you will gain more members. It's that simple.
Tip #5: Know What to Measure
There is no silver bullet, no single number that will answer all questions about membership health. But there is one important fact you need to know: You need to know your renewal rate.
Renewal rates reflect many variables from one group to the next, so there is no correct renewal rate. For some associations whose industry is undergoing job cuts, 70% renewal might be fantastic. For others where the industry is expanding and growing, 70% would mean trouble.
- The average financially healthy individual membership organization maintains a renewal rate around 76%.
- Financially healthy trade associations maintain, on average, a 79% renewal rate.
- Some organizations maintain renewal rates as high as 80% to 85%.
Cautionary note: A 5% increase (or decrease) in your renewal rate can spell the difference between explosive growth and sliding into a murky financial future. That potential 5% change up or down also affects your association's month-to-month cash flow and your available budget.
Once you know your annual renewal rate, you can calculate subsets including the first-year renewal rate vs. the overall rate, or the month-by-month rate compared to month-by-month rates from past years. Those subsets can be predictive barometers that will help you plan upcoming membership retention activities.
Your renewal rate also is a major variable in lifetime value, which means knowing how long members will stay in the association and how much you can expect them to invest with the association (investments work both ways).
Knowing your lifetime value removes most of the guesswork when you budget for new member recruiting (see Tip #1).
Work these tips, make them your own. Don't get sucked back into your busy day until you pick one or more that made you nod your head (in agreement or sadness), and then start figuring out how to incorporate that tip into your everyday work. If you don't know your renewal rate, give yourself a deadline and a promise to learn it. If you treat direct mail independent of Google AdWords, try to integrate those activities in your next campaign so you can measure the improvement (and take credit for it). If you pull together each recruiting campaign 10 minutes before your budget is due, then start noodling it now and take the time to plan a really fun and effective campaign (and take credit for it).
Membership marketing is a lot of work but it's also the heart and soul of the association, so do it well and enjoy yourself.
Harold Maurer is Managing Director, Account Team of Marketing General Incorporated and Barbara Armentrout is Relationship Director with Marketing General Incorporated, www.marketinggeneral.com. They can be reached at hmaurer@marketinggeneral.com; 703.706.0391 and barmentrout@marketinggeneral.com; 703.706.033, respectively.