Member Retention Rate Benchmarks
It's very worrying when you see membership rates dropping. How can you tell where your association is going wrong? How can you identify the areas where you need to improve.
In the for-profit sector, organizations often look to benchmarking. This means monitoring your performance and comparing it against data from other companies in your industry.
That’s not so easy in the association space. Benchmarking data is limited, plus the uniqueness of each association makes it hard to compare with other groups.
Benchmarking is still possible – you just need to focus on your own historical data. The more data you have available, the better equipped you will be to judge current performance and identify areas that require action.
Association Benchmarking Statistics
There are some statistics that can tell you a lot about how you are performing. You should try to measure as accurately as possible:
In simple terms, this is the number of new members that you add to the ranks each year.
You’ll learn more, however, if you divide these figures into subgroups such as:
- First-time members vs. returning members
- Job-market entrants vs. established professionals
- Reason for joining (certification, professional development, networking, etc.)
Try to track the recruitment channels for each new member. In particular, keep figures on the number of people who sign up as a result of your automated marketing campaigns.
Members also leave the association each year and you’ll need to include a count of those in order to track your progress.
Some attrition will be due to uncontrollable circumstances, such as member retirement. This kind of attrition should remain steady year-on-year. Your benchmarking should look to identify unusual trends that might suggest higher-than-average membership decay.
Retention plus attrition should equal exactly 100 percent, so this statistic doesn’t tell you a lot by itself.
However, if you dive into the data, you’ll find some interesting performance indicators. Watch out for when people pay their membership fees, for example. Highly-engaged members will pay their dues well in advance, while others may need several reminder emails before they write a check. Trends in this data will tell you a lot about whether you are providing value to members.
The usefulness of revenue figures as a retention benchmark depends on how your association approaches pricing. If members have lots of opportunities to spend – paying for training materials, event tickets, etc. – then you should see some variation in revenue statistics, and these variations tend to indicate current levels of member satisfaction.
Diving deeper into these figures will tell you a lot about what’s working and what isn’t. If you have a profitable revenue stream that is non-mandatory, that shows that members are highly engaged with that part of your programming.
Most associations focus on digital metrics of engagement because these are the easiest to measure. Your IT team should be able to provide you with data related to all kinds of digital engagement, including:
- Email statistics
Open-rates and click-throughs are the most important ones here. Break this data down by email type – for example, have one report that focuses on marketing emails, and another that describes engagement with your association newsletter.
- Website statistics
Consumable content such as PDFs, videos and podcasts all contribute to a handy engagement metric – total number of downloads. Of course, this doesn’t tell you if the downloader consumed the item they downloaded, but download rates are a good indicator of engagement.
Educational programming is a core offering for most associations, many of which insist that each member attains a certain number of education credits each year.
Data related to eLearning can tell you a lot about how well you’re providing these services, especially if you use Learning Management Software (LMS) to provide this content. An LMS can provide you with data like:
- How long someone spent on a module
- Whether they required any reminders to complete the module
- Which module they studied next
- Usage statistics per learning module
Stats like these can tell you if you’re providing quality education content. It can also tell if you’re providing such content in a user-friendly way, or if your education programs are a chore for members.
Return on Engagement (ROE)
Calculating ROE requires you to look at every aspect of the association. However, if you can calculate this metric with a reasonable degree of accuracy, you’ll learn a lot about how you’re performing.
At it’s most basic level, ROE involves working out all of the benefits related to high member engagement. That includes renewal fees, event attendance cost, ecommerce sales, and any other form of revenue that comes directly from members.
Next, you look at the cost of creating that engagement. Content creation costs, event hosting costs, technology, marketing – anything that the association spends on member engagement.
Comparing the two figures will give you an idea of your ROE. Low ROE means that your programming is not meeting member requirements, which could impact your retention rates further down the line. You may need to examine the way you invest in engagement-building and come up with a new strategy.
Benchmarking as A First Step to Change
Benchmarks ultimately tell you one thing: whether you’re doing better or worse than before.
Hopefully, your benchmarks will tell you that you’re improving year-on-year. This will be borne out by high rates of retention, as members stick with an association that provides real value.
If benchmarks point towards a problem, then you need to act fast. Review your programming, speak to your members, and find out if you’re providing what is expected of you. If you’re still not sure about how to proceed, the best thing to do is to talk to a professional consultancy like HighRoad.
About Aimee Pagano
Aimee joins HighRoad Solution with 15+ years of integrated marketing and communications experience, primarily in client-facing roles within the association and SaaS space. Her specialties include persona development, content strategy/management, lead gen and awareness campaign development, and website development/optimization.