Is Your Association’s Renewal Cycle Impacting Growth?

Membership July 29, 2013

Lori Halley

By Lori Halley

Did you know that your association’s choice of renewal cycle (fixed-date calendar or anniversary date) might impact increases in membership or your renewal rates?

Last week, in a post - Dues Cycles and Membership Metrics - Joe Rominiecki (Associations Now) noted that: from ASAE’s benchmarking studies showed that anniversary dues cycles (join any time, renew one year later) were more prevalent among individual membership organizations (IMOs) and larger associations, while calendar dues cycles (everyone renews on a fixed date) were more prevalent in trade associations and small-staff organizations. 

These survey findings corroborate our 2012 Membership Renewal Survey findings (reported last July). We found that our survey participants  - which were mainly small organizations with fewer than 2000 members - were predominantly using a “fixed-date calendar cycle” for renewals. Our findings were that:

  • 63.6% of respondents process renewals on a static or annual basis (or“fixed-date calendar cycle”)
  • 36.4% follow a rolling renewal cycle – renewing on the member’s anniversary date (or “anniversary cycle”)

Renewal cycles appear to be impacting membership increases or renewal rates

In his post, Rominiecki also reported on some of the findings of the 2013 Membership Marketing Benchmarking Report - in particular that:

associations on anniversary dues cycles were more likely to have seen an overall increase in membership in 2012 than those on calendar cycles, but associations on calendar cycles showed a higher average renewal rate.

Apparently, 56% of associations on anniversary dues cycles reported membership growth in 2012 versus 48% for associations on calendar dues cycles. 

However, the post also cautions that “there’s also an important relationship between new-member acquisition and renewal rates: “New members are always the lowest renewing category, so the higher your new-member input is, generally speaking the lower your renewal rate is,” according to Tony Rossell, of MGI (authors of the Membership Marketing Benchmarking Report).

Are small organizations using calendar renewal cycles because they find anniversary renewals too daunting to manage?

In his post, Rominiecki also noted:

... In Associations Now last fall, Wes Trochlil, president of Effective Database Management, pointed out that more and more association management software (AMS) platforms can automate much of the join-and-renewal process, which makes anniversary cycles more feasible. ...Automated, anniversary membership cycles also make it easier to add new members. But more new members generally means lower renewal rates a year later. Perhaps what we’re seeing here is that the anniversary cycle opens the door for a bit more volatility in membership numbers—more churn at the margin among easy-come, easy-go members.

For small organizations looking for help in managing renewals on a rolling or anniversary schedule, there are AMS’s or membership management software that cater to smaller organizations with limited budgets and time. For example, WildApricot is designed to help small non-profits and membership organizations automate their renewals using either an annual or anniversary cycle format.

But which renewal cycle is best for your organization?

If these findings leave you wondering whether your association should switch to a different renewal cycle, Tony Rossell, of MGI offers this advice in the Associations Now post:

 “From a consumer perspective, a consumer’s expectation for best practice would be ‘I could join whenever I want to join, and I’ll pay for one year and get renewed a year later.’ And anniversary allows for year-round marketing and takes prorating of dues off the table,” he says. “So, in general, my recommendation would be if you can operationally manage it with your staff and technology, it’s the right way to go.”

Which renewal cycle does your membership organization use?  Share your thoughts in the comments below.

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