On Membership Systems – Part 2

Posted by on Oct 21, 2014 in Communication, Donor Cultivation, Featured, Membership, Uncategorized | Comments Off on On Membership Systems – Part 2

On Membership Systems – Part 2

Last week, I answered Shannon’s question about how many times we should “pester” a donor before giving up. The answer: You should send enough letters (or emails or phone calls) to achieve a renewal rate between 70 and 75 percent. You might be aiming a little lower if you’ve recently had a large influx of new members because they tend to renew more reluctantly. I added that if it takes more than four letters, you might want to look at your letter’s content before you send a fifth letter. You can read the whole post here.

“But that’s a lot of work and a lot of details to keep track of, and I have lots of other things to do!”

Maybe we should revisit why organizations have members in the first place.

So why do you have members? Most organizations I work with use membership as a fundraising strategy. As such, it is very attractive. Membership is one of the most stable, sustainable, and predictable sources of unrestricted operations income out there, and has been for generations.

The process of membership renewal also tends to tie donors to the organization more effectively than single project or program appeals. The relationships built with members through annual renewal can blossom into long term “friendraising” that make capital gifts, planned gifts, and donor loyalty more likely in the long run. Moreover, the renewal process is a great way to introduce new and/or reluctant board members for fundraising (and acknowledgement!).

Fundraising is not the only possible motivation, of course. Establishing a permission-based communications loop, business community engagement, volunteer recruitment and organization, and political clout are all reasons for establishing a membership. But what it means to be a member and how you count members changes accordingly. For example, if political clout is your primary motivation, you might count every adult in a household, signature on a petition, or “like” on your Facebook page as a member.

What most organizations mean by membership is simply related to a mailing list – that members receive regular communications from the organization including paper and electronic newsletters, invitations to events, and information about outdoor activities on the preserves. In that sense, I agree with some consultant’s points about “not pushing people to join,” including “anyone who gives you any financial contribution” as a member, and even basing some memberships on volunteers hours. (Of course, if your membership is based on some factor other than check-writing, what would “renewal” even mean for you?)

To a very large extent, I therefore advocate separating these types of “benefits” from the definition of membership completely. Why wouldn’t you want everyone to receive such communication – assuming you could afford the cost, of course? I know of several land trusts who regularly include everyone in their township in their regular communications – not going to work in Cleveland, but it’s great in Bolton, CT!

The problem with that approach – in fact the ONLY problem – is that it is not useful in predicting operations income. Assuming raising money is at least part of the reason for your having a membership, you’ll have to look at just the check writers at some point and ask how likely it is that they will give again. Maybe you end up calling just those people “members.” Maybe you find some other label (annual donors?).

So then the question becomes: If we don’t send a reminder, will we have enough to pay our bills?

If we could reliably predict that everyone who wrote us a check last year will do so again, in December, and that their gifts would increase enough to keep up with rising operating expenses, then only mailing a single letter in December would make sense. In fact, that’s not the case. First, many people prefer to give in December, but some prefer to give in April, some in January, some in October, and so on. Some people miss the request in the mail completely, or the wrong person opened the mail that day, or it got mixed into the vacation mail, or any number of other possibilities. Some donors respond to a membership “push” but not to other types of letters. We still want them as members.

Let’s say that you’ve mailed a member some number of renewal requests and that they haven’t responded. If you give up on them, you will need to “replace” them with a new member to simply maintain the same number of members you had last year. Is it more expensive (measured in time, money, and “nuisance”) to renew them, or to replace them?

The Nature Conservancy tried to answer this question about 20 years ago. They measured response rates, time and money invested, and negative responses (pestering), and found that the 9th renewal letter still performed better than replacement efforts.

I wouldn’t recommend that anyone use a nine-letter sequence as their core renewal strategy. Still, count me as a consultant who recommends that we not give up quite so easily on our individual donors. Don’t pester them, but make sure they notice you in their mailbox.

Stay tuned: I’ll give you one specific strategy next week.

-da

Photo credit: Mud Lake courtesy of C. Miko Dargitz.