It is no question that every organization should be using KPI's that help guide their strategy and revenue. We cover those KPI's as well as dive into tips for a successful renewal season.
Measuring KPIs for Membership Organizations: An Executive's Guide
In the pursuit of running a profitable membership organization, your value directly correlates to your ability to recruit, engage, and retain members. The viability hinges upon the interplay of these three factors, underscoring their absolute importance. As such, accurately measuring, assessing, and responding to these metrics is not just an optional advantage; it's a necessity for sustainable growth.
Membership organizations thrive on member satisfaction. As the lifeblood of the organization, they infuse it with energy, purpose, and the means to pursue its mission. But members don't simply appear; they must be attracted to the program. As the first step in the member journey, recruitment lays the foundation for everything else.
Engagement is the cement that holds the bricks of membership together. It's not enough for members to just sign up. They must actively participate and engage with the organization's offerings for their membership to hold real value.
Retention, or the ability to keep members involved over time, is the natural progression of recruitment and engagement. Effective retention strategies ensure members continue to see the value in their membership and choose to renew it. Retention is often overlooked in favor of recruitment, but retaining an existing member is usually more cost-effective than attracting a new one.
This guide will explore top KPIs that membership programs should focus on to measure their effectiveness in these crucial areas and strategize for growth. By closely monitoring these metrics, organizations can glean valuable insights and make informed decisions to bolster their recruitment, increase engagement, and reinforce retention strategies.
Tips to Increase Membership Renewals
Most organizations focus a majority of their budget and energy on member recruitment; however, while valuable, membership renewals are the primary contributors to the longevity of any association. Without high retention rates, monthly cash flow can be unpredictable, and the club’s culture and reputation can come into question.
For organizations that utilize a calendar-based membership term, November to January can be anxiety-inducing. However, these are critical moments for any organization to recognize its strengths and weaknesses and plan around its renewal rate.
While expanding your club to new faces is undoubtedly essential, even the most successful organizations see an annual churn rate of 5%, with some clocking in at a whopping 10%. Additionally, according to the 2021 Membership Marketing Benchmark Report, 45% of associations saw a decline in member renewal — almost two times 2020’s rate of 24%.
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