Membership: For love or money?

Editor's Notes

1. introductions
2. Visitors become members for two reasons—because they love the organization and because they are driven by the value of the transaction. Those who love the organization are true friends to the membership department. They’re the folks who renew no matter what, who push down expenses and increase the ROI of your membership dept. Those who are in membership for the money are deal driven. They get in and stay in because they get discounts on exhibit tickets or admission that make it worth it to be a member. Can they be developed into a “love” patron? Maybe.
3. But how do we know which members fall into which categories? We can assume that there are members who feel strongly one way or another—on either end of the bell curve here. And, there are those who are in it for a mixture of reasons—and might be persuaded one way or another. Sometimes we don’t know who’s who. Are they in it for the love or the deal?—they may not know themselves.
4. Jill: Let’s think about the foundation of a membership program—loyalty. What does it look like to be loyal to a museum?
5. Almost every patron at your organization begins as a new ticket buyer or visitor. Sometimes, as we know, membership is the next step after a visit, but sometimes it proceeds a visit. Think about that first encounter as a “first date” with the organization. If they enjoy their “first date” with you and you ask them to come again, they’ll come back. And we know that repeat visitation is critical to membership. When the romance goes to the renewing Membership level, this is like going steady. Donation: that’s like getting married, because once you have each other, and, if the relationship is well-developed and cared for, you often have them for life. Finally, Advocate/Investor. Getting to a major donor level, that’s like celebrating a golden anniversary. Not many get here, but these relationships are worth their weight in gold. Each stairstep brings ROI up and expenses down.
6. We can sort patron development steps into three more general categories, based on how much they spend with the organization total, how frequently, and how recently. (Advocates-Donors and consummate loyalists) You likely know the names or faces of many of the folks in the Advocates category. They’re board members, major donors, and long-time subscriber-donors. (Buyers-the magic of “and”) Buyers contribute less on a per capita basis than Advocates. They do multiple activities with an arts org—what we call the magic of “and”. They bought a ticket last season and this season they became a member. Or they took a class. Or they made a small donation. (Tryers-from 1st time to second or next time to now.) Tryers are the least loyal—they spend the least per capita. These are our coveted new audiences, one-time ticket buyers and occasional attendees. You may be wondering about the proportions of the pyramid. ( for category stats) The tryers portion is the largest because the vast majority of the people in your database are Tryers – lapsed and new single ticket buyers. On average, about 4 out of 5 of those tryers come once and never come back. They never become Buyers or Advocates. And that’s a shame, because look at how much revenue Buyers and Advocates contribute compared to their size. That base of Tryers is unstable and left untended, it’s going to be the source of decline in your organization. JILL and MOLLY: for DAM - Much more revenue pressure at the top from a very small group. - Similar to what we see nationally in the buyer category
7. Loyalty trends are found in integrated data. By that we mean transactional information on each patron that details ALL they do with an organization, across their entire personal relationship with your organization. Let’s take a look at some real-life Buyers, most of whom are members, at DAM. See patterns. In the universe of Buyer relationships, you’ll find groups of patrons with similar behavior patterns. Patterns allow you to develop segmentation so you can cultivate groups of patrons into next steps, AND Because you’ll understand current behavior, you’ll be able to cultivate groups of patrons into longer, stronger engagement that is meaningful to them. This is evidence-based patron development. You’re not guessing that the first step toward philanthropy is membership. Or annual fund. You are following data to discover the "and" behavior of a Buyer—and putting yourself in the position of growing engagement incrementally over time. Once we know our patrons, what do we do with them? UPGRADE THEM
8. There is an upgrade for every patron at every phase of their relationship with your organization. Here are a few examples of upgrading. Here’s how we traditionally think of upgrading—moving up the levels of membership. But there’s a lot more there. I might not be ready for an upgrade to membership on my first visit, but I could be upgraded into buying an IMAX ticket. If I buy a ticket, my right next step might just be a membership. If I buy a membership for the first time, I might not be ready for a contributing member upgrade. My right next step might just be to attend that year, priming me for renewal. By the time I’ve been a member for a couple of years, I’m ready for deeper engagement – we’re going steady now –ask me to add on a donation, or a ticket to a special performance, exhibit or Gala.
9. How much does your organization collect from visitors? How does your org value data? What inroads have we made as a field here? What do we do with it? How have some of you made strides in getting more?
10. We attract more loyal members in the first place by upgrading people who show an interest in our organization. Here’s one way we do it at DAM: Talk about upgrading to membership at front lines—patrons buy online and come to the museum, or just walk in. If I can get them to come to the museum, my staff can upgrade them. Or through direct mail: Talk about campaigns for membership and how they require DATA
11. We have a data problem. We have a large portion of patrons who could be good prospects for membership because they visit us. But we only have data for a small portion of those folks.
12. If you want first-time visitors or one-time exhibit attendees to buy a membership, you’ve got to be able to contact them again. If they are already attending, you’ve got a better shot of holding on to them as members for longer.
13. Collecting tryer contact information isn’t a touchy-feely “just-for-the-heck-of-it” type initiative. It can mean serious revenue gain. Here are the top performing segments from our VG single ticket those that are highlighted are our house lists.   53% of all responders were already in our known universe— 27% were lapsed members, but the other 26%--the highlighted section, circled here, are exhibit buyers and others in our house lists. Had we not gotten their information at the Point of sale, we could have missed out on over a half a million dollars in revenue. Why would you rent zip code lists for membership acquisition, full of people who have never been to your museum at all? There’s a disconnect there.
14. What about membership? In the membership campaign, here were the top segments. Again, lapsed members out performed the rest. But, check out the rest of the highlighted house file segments. Together, they gave me 794 new members.
15. With any ticket purchase, the visitor saves by buying online. Why? This museum wants to collect patron contact information – they want to use that contact information to develop a future relationship with their visitors. So, they motivate that behavior by offering a discount for buying online.
16. How do you change culture? The crazy stuff you do to get data.
17. New patrons What are the markers that make them likely to and not likely to? Significant membership communication. Twice a month mail. New members are vulnerable. What constitutes a new member? Only been a member for a year, or recapture, renewal. Programming matters
18. This data is a few years old for us (was completed in summer 2011 using historical data before that), but I think still relevant if not totally accurate at this point. We found that our renewal rate increased 6% after a visitor visited one time during their membership, 9% when they visited twice, and 11% when they visited three times.  After three visits, the increased renewal rate was much less pronounced.  These numbers shift when you start to break them out among new, consecutive and rejoining members. 
19. We had roughly 6,200 brand new to file members sign on during Van Gogh (they’d never had a membership with us before). Say more about how big of a hit the exhibit was, and how unique it was.
20. Talk about membership offer associated with Van Gogh.
21. We called all of the 6,200 following the show and invited them to attend an upcoming program, most of them were invited to the member preview for a new show that was included in general admission and therefore free with their membership.  We had 1,357 member households attend, 2,565 attendees---for a GA show!  Attendance for a general admission member preview varies widely, but this is the most we’ve ever had, a more “normal” attendance for a member preview would be in the 500 range, sometimes going up higher if it’s a very popular subject, but 2,500 was out of control (and we didn’t manage it very well, to be honest either).  For another comparison, we were open extended hours for the Van Gogh member preview and we had 2,321 individual members for that.   Capacities were restricted, but as you can see, the draw when we personally invited people was really noticeable.  QUESTION: Where they staying because attended, or were people more likely to stay simply more likely to come to this event. And, does it matter?
22. The gist of the early bird renewals is that we wanted to start incentivizing members on the behavior we desired, which is renewing.  Specifically renewing before their membership expires.    Additionally, this change was brought about following a high attrition period following our King Tut exhibition, which were highly value-motivated members.     Instead of sending the first renewal notice the month of expiration, we changed it to sending an “early bird” notice two months before their expiration and offering them added value to renew one month in advance of expiration, or by the end of the month that the notice is received.   By doing this, we are motivating behavior to keep members from ever lapsing—even for a day.  And we are decreasing costs over the long-term, because we send fewer renewal notices during the renewal cycle to try to keep people.   We increased our month one renewal communication response rate by over 12% during the first year of the program.   I’m not sure if you can/want to work this in or not, but in addition to maintaining a message of value, and generally influencing the kind of behavior we want, this change of strategy also gave us a one-time boost to membership revenue of almost $60,000---at a time when we really needed it.  This occurred because we lumped an additional group of members into the renewal cycle who would not normally have been included at that time.  And since the strategy has remained in place, there have been no long-term detrimental effects.
23. Once membership stops, does loyalty stop? Does INTEREST stop? Blockbusters are effective loyalty tools because they retain and recapture. Molly: data on 3 years of membership and 5 years of membership, xx more likely to renew. Philly data? For Becoming Van Gogh, the #1 performing segment was lapsed/recapture. For many orgs, it’s the only group they have to market to. It’s the only group we had. Membership fell off a cliff after King Tut. House lists. People in the universe. Tied to ticket value. During Modern Masters, A/B tested. ½ got two extra months of membership, ½ price tickets to Modern Masters. Neck and neck.