MGI Tipster – Volume 10, Issue 12

December 15, 2011   |   Vol. 10   |   Issue 12
Renewals Best Practices



Renewals are a vital contributor to the revenue stream of most associations. Renewals are more often than not the foremost income generator, so it is critical that the entire process be consistently accurate, reliable, and on time.

In the November edition of the MGI Tipster (Volume 10, Issue 11), we examined several elements of a successful renewals program, including messages and the importance of a well managed member database. In this issue, we explore the options to achieve a balance between simple and complex renewal schemes to optimize results.

Investment and Complexity

Renewals programs can be uncomplicated or extremely involved, from a once-a-year mailing to a monthly series that includes mail, email, the Internet, and telephones. Whether an association has adopted a calendar year or an anniversary membership structure plays a large part in determining the resources and the intensity that membership organizations must devote to the renewals process.

Using the calendar year model, if all of an association’s memberships begin, say, on January 1st and end December 31st, the renewals process is relatively simple. All of the work is concentrated in a short time frame, and then the job is finished until the next cycle a year later.

On the other hand, if members renew on the anniversary of their join date, the process becomes more complex. Most associations batch each month’s lapsing members and send several notices over several months. This means that a series of a dozen notifications are initiated, each on a different schedule and all running simultaneously. Adding additional notices and different channels such as email and telephones adds additional layers of complexity.

Add to that personalized messaging, and the complexity continues to grow. References to transactional information, specialty section memberships, and chapter affiliation, for example, are often effective devices, but that serves to further complicate the process. Associations must decide whether the complexity and the investment to sustain these touches result in measurable and worthwhile improvements in the renewal rate.

Control and Simplicity

A well managed process is often the most important contributor to a successful renewals program, and simplicity encourages better control, helps reduce errors, and lowers cost. For some organizations, just getting renewals out consistently is a challenge in itself. A missed renewals mail date is likely to impact cash flow, which may be critical. Simplicity may be the best remedy. On the other hand, the more complex renewals scheme may be worth the trouble because of the lift in response it generates.

Membership organizations should also make the process that members follow to respond to the renewals invitation simple and easy by giving them a variety of ways to contact the association. Offer a toll-free phone number to member services, an online website address, an embedded link in emails, plus a fax number and a postal address.

Affording membership dues should also be as accommodating as possible. Offer a variety of payment options including monthly installment plans, electronic funds transfer, and/or automatic annual renewals via credit card. Keep it simple, offer a wide choice of response avenues, and make available easy-payment options.

Measuring Value

Renewals are an excellent opportunity to restate the value of membership and, by the response rate, to measure the value that members attribute to the organization. Renewal rates are a good measure of the value members believe they receive. Poor actual or perceived value almost always results in lower renewal rates. But if renewals are declining despite a strong renewal program, a member engagement plan or a lapsed member reinstatement series may be in order.

Whether sent by email, surface mail, or linked to the web, renewal notices should leverage the association’s brand and continue to build recognition and awareness. Make the renewals communications you send work in several ways at once.

Never Stop Talking to Members

Marketing General’s 2010 Membership Marketing Benchmarking Survey pointed out that associations that have attained better than 80% renewal rates are those that continuously ask their members to renew, often using high message frequency and multiple channel touches. This suggests that renewals contacts should begin early, be delivered consistently, and continue well after their member’s expiration date. This continuous renewal process is effectively an engagement program.

At MGI, we have found the optimum number of renewal messages hovers between 7 and 10. Touches may include various combinations of surface mail, email, and telephones. Emails should have embedded links to connect with micro sites for ease of contact, and outbound telephone calls should be dialed at different times on different days to improve the chances of reaching members to renew.

Remember to Thank Them

Members are the life force of associations. “Free” may still be the most powerful word in membership acquisition, but for renewals programs, saying “thank you” is just as important. Members who are actively engaged in an association are more likely to renew. So listen to them, talk with them, and involve them as you design or redesign your systems to create the most effective membership renewal program possible.



If you would like to learn more about renewals and the best practices for implementing them, contact Rick Whelan, MGI’s President, at 703.706.0350 or rick@marketinggeneral.com.

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