The new year is just around the corner. And for many associations and clubs, the fresh new year heralds the start of membership renewal letter season!
Should old acquaintance be forgot, and never brought to mind?
While many of us celebrate the start of the New Year by singing Auld Lang Syne, membership organizations shouldn’t forget to develop strategies for retaining their existing members. After all, not only are existing members the foundation of your organization, but it is also less expensive to retain members than it is to acquire new ones.
As you formulate your membership retention strategy for the coming year, if you’re wondering about when you should start the renewal process; how many contacts or “touches” you should make; and how to best get your current members’ attention, you may want to see how other associations are handling their renewal process. Marketing General’s 2011 Membership Marketing Benchmarking Report, which surveyed more than 650 association executives, provides a snapshot of the experiences of other associations in the U.S. Here are some of their findings on membership renewal practices:
How many renewal contacts should you make?
- over 40% of associations make four to six contacts before a membership expires
- about one-quarter of associations only make one to three contact attempts
- close to 20% make seven to nine contact attempts.
- fewer than 10% of associations make 10 or more membership renewal contacts before a membership expires.
When should you start the renewal process?
- About one third of associations begin their renewal effort three months prior to membership expiration.
- Just over 10 percent of associations either begin their renewal effort at four months prior to expiration (12%) or two months prior to expiration (16%).
- There is a slight upward trend to start renewal efforts closer to the date of membership expiration (one or two months prior to expiration).
- Associations with renewal rates at 80% or higher are more likely to begin renewal efforts from “immediately after welcoming a member” to the six months prior to expiration (24% to 19%).
- Associations with renewal rates below 80% are significantly more likely to begin renewal efforts at three months prior to membership expiration (39% vs. 29%).
What channels should you use for renewal letters?
As Marketing General noted in it's MGI Tipster, one of the most "common reason members do not renew - other than a breakdown in the value equation - is that they simply forget." This means you need to figure out how to break through the barrage of information folks receive daily and figure the best way or combination of ways to get your renewal message out. Here are the findings around renewal channels currently being used:
- Email marketing and direct mail are still the most common marketing channels for membership renewals, although direct mail shows a continued drop in usage for renewals.
- Staff phone calls are used by more than half of the associations (52%), showing a slight increase over the previous year’s drop.
- About 2 in 10 association professionals indicate that their organization uses peer member contacts for renewal marketing, although this channel has also shown steady declines in usage.
- Associations with increases in renewals are significantly more likely to use email compared to associations showing declines in their renewals over the past year (92% vs. 84%).
What payment methods/options should you offer?
Given the current economy, you might want to have a look at providing easy to use options for renewal and payment of membership fees. Here are the options being offered by those who participated in the 2011 survey – have a look and determine whether any of these would work for your organization.
- 46% of associations offer an installment renewal payment plan and about one-third offer multi-year renewals (32%).
- Close to one-quarter of associations offer:
- a renewal bill-me plan (28%)
- a lifetime membership (25%)
- and/or an automatic annual credit card renewal (24%).
- More than half of associations with renewal rates over 80% offer an installment renewal payment option, compared to associations with less than 80% renewal (54% vs. 35%), a statistically significant difference.
- Associations with less than 80% renewals are significantly more likely to offer multi-year renewals (50% vs. 20%) and/or early-renewal discounts (27% vs. 17%).
If you'd like to review all of the findings in the 2011 Membership Marketing Benchmarking Report - a free download (of the PDF) is now available via AssociationJam.org - here.
Developing a renewal plan that fits your organization
After reviewing the statistics from the Benchmarking report, you’ll then need to develop a plan that works for your particular membership audience. In a recent issue of their MGI Tipster, the folks at Marketing General offer some general guidance for renewal procedures that included the following tips:
- Test various combinations of email, mail, and phone renewal messages to discover which works best.
- Since email is less expensive than regular mail, consider beginning the renewal message series with it, move on to regular mail notices, and end with a phone call, the most expensive channel. The final communication may link to an online survey to discover reasons some members do not renew.
Before you start - be sure your membership database is up-to-date!
But as the MGI Tipster also cautions, before you can embark on any renewal program, you need to be sure your membership database is up-to-date! They suggest that “an organization's credibility and attention to detail is on display when members receive their renewal notices, so all information should be accurate.”
If you are using Association or Membership Management software – such as Wild Apricot – your members can easily update their profiles online and all data is stored in one central membership database. This means that you don't have to worry about the potential of using old, out-of-date contact or membership status information for your renewal outreach. In addition, you can set up automated renewals with customized emails for multiple membership levels and create easy online renewal procedures with customized payment options.
Crafting an effective renewal message
As we noted in a previous post – Demonstrating Member Value – your members are looking for "benefits that add value to their businesses and lives and they also look to their associations for a sense of belonging." While you need to figure out the best channel to help you break through their email clutter and get your message across, you also need to take care in crafting your renewal communications messages to be sure it resonates with your members. As Sarah Sladek suggests in an Associations Now article - How to Build Membership Relationships That Last – "People want to join your association-- and renew their memberships --
when you provide services they need along with emotional connections they crave." This means that your communications need to take an "outcomes-based benefits" approach instead of simply reminding them of a "basket of products and services."
Good luck with membership renewal letter season - and keep us posted about your efforts and challenges in the comments below.
Photo source: Daniele Sartori's Flickr Photostream