The ROI on Member Retention

Size: px
Start display at page:

Download "The ROI on Member Retention"

Transcription

1 The ROI on Member Retention Why Focus on Member Retention? The Myths Around Member Retention Retention is About Loyalty, Not Satisfaction The Lifetime Value of a Member The Key to Retention is Member Relationship Management The 5 Stages of the Member Experience Cycle Why Members Leave, Why Members Stay The Cornerstones of a Retention Plan

2 Why Focus on Member Retention? Current challenge for most associations and member-based organizations There are more member-based organizations than ever before, competing for some of the same customers Usually, there is more emphasis on recruitment than on retention It costs less to keep members than to be on a constant hunt for more (minimizing the member revolving door syndrome )

3 The Myths Around Member Retention 1. It s easier to replace lost members with new ones. 2. More resources should be spent on recruiting than retention. 3. We only need to sell a member once. 4. All members want the same things. 5. Members understand what we offer.

4 The Myths Around Member Retention 6. Members can access information if they need it or are interested. 7. We know what our members want and need. 8. If our members rate us high on satisfaction surveys, they ll renew. 9. Frequent reminders to past due members is a retention plan. 10.We coordinate events, respond to questions are being busy with daily operations that serve members. Isn t that enough?

5 Retention is About Loyalty, Not Satisfaction There s a difference between SATISFIED and LOYAL members. LOYAL members: Tell everyone about the Chamber Refer their friends, neighbors, family and business associates Invest in the Chamber (by attending events, participating in activities and services, and volunteering) Feel they have a mutually-beneficial relationship with the Chamber Are champions for the Chamber

6 SATISFIED members: May tell others about the Chamber if asked Sometimes they refer others, sometimes they don t Attend or participate in the Chamber if it s convenient Feel they get some value from being a member May not feel the Chamber meets all of their needs or the needs of other businesses in the community

7 SATISFIED members aren t always LOYAL members Satisfaction may create passive or benign relationships while retention is built on proactive and dynamic relationships Retention and developing loyal members requires a different set of behaviors

8 The Key to Retention is Member Relationship Management Customer Relationship Management (CRM) goes beyond customer service CRM uses practices, a set of tools and technology to manage relationships with customers by: Defining and understanding their needs Aligning products/services to meet their needs Communicating and interacting with them on a regular basis Developing a customer-centric organization Providing optimal value for their investments Recognizing and rewarding their loyalty CRM = Member Relationship Management

9 The Lifetime Value of a Member Question: What s a Member Worth? Answer: A = New Member = (First year dues + first year non-dues revenue) + ((no. of annual renewals) x (dues + annual nondues revenue)) + B = Referred New Member (no. of referrals x A)

10 The Lifetime Value of a Member Example: A = ( ) + ((4 x 300) + (4 x 300)) = (1 st yr dues + 1 st yr non-dues $) + (4 yrs renewal dues x amt. of non-dues $) (5 x 3000) = $18,000 (Total A $) + (5 renewals x value of a new member for 5 years)

11 5 Stages of the Member Experience Cycle Member Experience Cycle Initial Contact Selling to Member Needs The Sales Transaction After-the-Sale Appreciation The Touch Program

12 Stage 1: Initial Contact What do I think about you? What do I think about the Chamber? What is the Chamber s image, reputation, expertise or knowledge? How am I treated? Do I feel welcome? Are you responsive to my inquiry, presence and sense of need? How do you follow-up with me? Do you contact me before I contact you again? Do you call, fax, mail or me when you say you will? Do you provide information as I requested?

13 Stage 2: Selling to Members Needs Do you take time to discover my needs? Have you asked me what my needs are? Do you listen when I explain my needs? Do you understand my initial expectations? Have you defined important buying factors for my membership? Do you align your products and/or services based on my expectations? Do you accurately anticipate some of my unspoken expectations? Do you sell using the WIIFM approach (What s in it for me?) Do you sell/offer membership benefits that I think are important? Do you check for understanding and alignment?

14 Stage 3: The Sales Transaction Do you make the sales transaction easy for me? Do you offer different types of payment (e.g., cash, check, credit cards, PO, installments)? Do you offer different ways to sign up (e.g., fax, mail or applications)? Are you and/or your staff easy to work with, understanding, knowledgeable and efficient? Do you have a positive attitude? Do you understand your products/services and procedures? Do you process the sale in a timely and efficient manner? If there is hand-off to someone else, do they follow through? Is there consistency and high-level service from all staff members? Is the transaction seamless from one hand-off to another?

15 Stage 4: After the Sales Appreciation Do you thank me for my business? Do you call, or mail me a thank you? Do you make me feel appreciated for buying from you? Do you follow-up on the sale? Do you see if I have any concerns? Do you ensure I receive information as promised from the sale transaction (e.g., membership packet, coupons, invitation to Orientation)? Do you invite me to get involved? Do you remind me about upcoming opportunities (e.g., BAH, training course, new member orientation, council meetings)? Do you help me get started on my new membership?

16 Stage 5: The Stay in Touch Program Do you stay in touch with me as a new member? Do you call, or mail me 30 days after becoming a member? Do you interact with me a few times during the next 90 days? Do you provide one and two-way interactions throughout my first year? If I ve been a member for over a year, do you stay in touch with me? Do you provide one and two-way interactions throughout the year? Do you communicate your goals, strategies and outcomes? Do you ensure that my expectations as a member are being met? Do you develop a loyalty relationship with me? Do you continue to align your products/services to my needs? Do you continue to recognize, acknowledge and appreciate my membership? Do you encourage repeat business from me and referrals?

17 How Do You Know if Your Chamber Employs Member Experience Well? You know about your members their expectations, involvement and why they are loyal to the Chamber You stay in touch and interact with members on a regular basis Your members referrals account for 20% - 30% of your new business Your members are loyal to the Chamber even if competitors try to steal them away Your Chamber is Top of Mind or in the forefront of members minds when they hear about an opportunity for the Chamber and they recommend others to you You spend less money on getting new members and have steady growth due to high retention rates and member referrals

18 Why Members Leave Members leave because: They re not involved, engaged or connected They re not aware of, understand or use what the Chamber offers They don t communicate with the Chamber Their expectations aren t met They don t have ownership of decisions, processes or programs

19 Why Members Stay Members stay because: They feel welcome and a part of the Chamber community They actively communicate with the Chamber They share their knowledge and expertise with members, and they feel connected with others Their contributions and business are appreciated The Chamber meets their expectations They are involved with the evolving role of the Chamber

20 The Key Components of a Retention Plan Determining the Existing Mental Models Collecting Member Feedback Understanding Spoken Expectations and Unspoken Needs Defining Challenge Areas and Opportunities for Improvement Determining Retention Strategies and Tactics Creating a Touch Plan and Customer Connections

21 Retention is the Key to Your Chamber s Growth It never ceases to amaze me that companies spend millions to attract new customers (people they don t know) and spend next to nothing to keep the ones they ve got. Seems to me the budgets should be reversed. Jeffrey Gitomer, Customer Service is Worthless, Customer Loyalty is Priceless Hight Performance Group (720)

22 Retention Scorecard Rate how well your Chamber uses retention strategies Stop by our booth and receive a free Member Retention Scorecard