Association Technology

Help Your Association Make Money With Data-Driven Decisions

Use Data-Driven Decisions to Make Money for Your AssociationI was recently at a national association headquarters listening to the membership VP (we’ll call her Jessica) explain her strategy for member retention and recruitment. I was there to help her team analyze their membership as they were converting to our association management platform, WebLink Connect.

Jessica told me, “Our strategy is to keep it simple – we focus on two core values – first we focus on advocacy and being the legislative voice for our members and second we provide networking opportunities for our members at events.”

However, despite defining a clear strategy, her association - like so many others today - was losing both membership and revenue. When I asked her to define the common attributes of the members that were leaving vs. the ones that were staying, she wasn't able to give me many specifics.  

She did say, “Well, we do survey members that leave, and recently we have had a lot of members whose companies have been bought; so we are going to start a membership campaign to go after the acquiring companies.”

I asked her, “So how many is ‘a lot’ in terms of dollars and count, and how many dollars are you planning on spending to pursue the acquirers with this new membership campaign?  What is your estimated recapture rate in count and dollars, so you can see if this is a worthwhile endeavor?  How does this compare to other initiatives in terms of ROI?   Perhaps these resources should be used elsewhere?”

Even with a several million dollar budget and 25 employees, the only real segmentation she could easily provide was a list of members, and a list of dropped members. She also had not put any thought into how much it would cost her to dedicate 3 people for  a 2 month long campaign to recapture these lost members.

She started a passionate argument with about how they know that focusing on acquiring companies in their association space will really pay off.  

Just as passionately, I said “Jessica, a successful recruitment and retention strategy must be backed by numbers, financial numbers, to know which segments of membership are most profitable and which ones are not. Once you identify the most profitable segments of your members, go all-out to keep them and focus on getting more members in that same segment. Once you master one segment, move on to others using the most profitable one as your foundation.”

Like all good executives, Jessica was very open to learning how to sharpen her approach with numbers.

To get her started I told her to pull a minimum of the following data for analysis for the past 3 years:  Member Name, Dues Paid, Non-Dues Paid (Events), advocacy surveys completed, Events attended in the past year, date joined, and number of employees.   Ultimately, on the dollars, I wanted to see the actual PAID dollars to make sure we were not confusing income with trade outs and write offs.

Doing this simple request wasn't so simple.  Jessica had to contact her vendor to export the data into Excel for us, and we spent 2 more days getting data from other systems. I’ll spare you all the gory late night data scrubbing details, and cut to the chase.  Here is some of what we found:

  • There was a 90% retention rate in membership dollars and count for members with more than 10 employees
  • There was a 55% retention rate in membership dollars and count for members with less than 10 employees
  • Members that attended at least 1 event a year had an 85% retention rate    
  • 45% of Members who dropped in their first year had less than 5 employees and never attended an event
  • First year members who attended at least 1 event (online counted too) had a 70% retention rate; if the first year member had more the 10 employees this jumped to 95%!

Armed with data, Jessica was now a force to be reckoned with and her confidence soared.  

She told her staff to immediately reach out all members with more than 10 employees and personally thank them for their support. She changed her sales reps commission to reward landing members with more than 10 employees. She did further analysis on events, giving her the ability to identify which ones were really helping retention, and which ones were not.

Over time Jessica pulled this same data each month and compared it to the previous month, and to the year.  Her analysis made her a smarter leader and provided her with keen insight in respect to the member management of her association.  

It has been about 9 months now and Jessica has lead her organization back into the black and for the first time in 5 years their revenue will increase.

If you are getting daily visibility into this type of information from your Association Management Software, you should be able to make great, informed, decisions and know where to focus your time and your association’s resources.  

If you do not have visibility into this type of data, you should consider investing in a membership management software system - Jessica told me it was well worth the money!

 

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