How to Reduce Membership Churn with an Association Management Software (AMS)

How to Reduce Membership Churn with an Association Management Software (AMS)

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When looking at dwindling contact lists, membership-focused associations and organizations all ask themselves the same question: How do you reduce membership churn?

Overall, you may know if your list is larger or smaller month-to-month, but that stat isn’t going to tell you why you have churn and how to prevent it. You must track the number day-to-day, week-to-week, month-to-month, and year-to-year, whilst also knowing the percentage of churn in the same timeframes. Having this data live, in real-time will indicate crucial activities that either increase or reduce membership churn, helping you to solidly start and stop doing the most impactful actions.

Before you can develop a plan to reduce membership churn, however, you must understand what it is.

What Is Membership Churn?

Membership churn is the loss rate of your memberships from one point in time to another. On average, people try to track this month-to-month, but companies with the latest retention technology, such as association management software (AMS), measure this rate daily to see what activities are increasing or decreasing memberships in the moment. This can be especially useful when promotions and events occur or when large membership cancellations occur in a short span of time.

How Do You Calculate Your Membership Churn Rate?

To calculate your churn rate, simply take the number of memberships from one point in time (say at the end of the month) and minus them from another point in time (say the beginning of the month). If the number you have at the end of the month is lower than what you had in the beginning, then you know you have membership churn.

For example, you could have 1,000 members at the end of the month, but at the beginning of the month, you had 1,050. This means you lost 50 memberships, and your churn percentage would be the following:

  • The number of customers that you lost: 50
  • Divided by the number of customers you started with: 1050
  • Multiplied by 100
  • 50 / 1050 = 0.0476 x 100 = 4.76. Your churn is then 4.67%

 

Churn Rate Averages

Most experts agree that a churn rate of 3-5% monthly is good. Considering that the current-day fast-paced competitive online environment, associations and organizations are gaining and losing members all the time—sometimes it’s seasonal, sometimes it’s competition, sometimes they’re doing something wrong. But to find out what the causes for success or failure are, you must track data first.

The Digitization of Membership Tracking

Realistically, most organizations do not have the bandwidth and resources to constantly pull, check and calculate these numbers on the regular, which is one of the reasons why the adoption of AMS technology is rapidly picking up pace in the membership-focused association and organization ecosystems; the software automatically tracks the important metrics to ensure staff and senior leaders are always in the loop with one of the most important numbers.

Once you have these stats, you can start taking action where it counts, whether it’s changing current offerings or revamping marketing efforts.

 

Tips for Reducing Membership Churn

Currently, there are a few ways companies try to reduce churn, including the following:

 

Make the Membership Valuable to The Members

Your members joined for a reason. In many cases, a promotional offer is what lured them in, but what you give after is what will make them stay. Ask yourself the following:

  • Do you offer them insightful content curated to their interests?
  • Do you have social networks where they can expand their interests or contact your association?
  • Do you offer them extra promotional offers or discounts that new members don’t get? Don’t forget that loyal members can earn you more than new members in the long haul, so you need to acknowledge their value by giving them extra perks.

 

Make Sure Your Membership Experience is Simple and Streamlined

It’s a fact: humans now have attention spans shorter than goldfish. What does that mean for your association? It means that when members are interacting with your brand online, they need to get exactly what they need in record time. This entails making your website easy to navigate, with simple, easy-to-read text and vivid, eye-catching visuals. The user experience is critical to how people view your brand, so make sure you are up-to-snuff, or else they won’t hesitate to jump ship. Often website issues can be identified through page exit rates, so make sure you monitor all your pages regularly to see if the membership cancellations occur more frequently on certain pages than others.

 

Give Members a Reason to Stay

Sometimes, it’s as easy as saying “Please don’t go, we’ll make it right.” The best brands will make sure exiting members are greeted with offers, promotions, or unknown membership perks. Members in the midst of canceling might see a pop-up that says “Are you sure you want to lose access to unlimited streaming content, 3 free events per year, and an annual gift?” and this will remind them of all that they stand to gain from the membership. And if that doesn’t work, who doesn’t love a freebie?

 

There are many ways to reduce membership churn, but tracking the membership data is among the most important tactics before all else. To learn more about how to upgrade your association to Association Management Software, click here.

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