Marketing General Incorporated Blog

Improving Your Membership Marketing Playbook by Testing Offers

In direct marketing there are three big items to test: lists, offers, and message. 

I thought that I would share some insights from what we have learned over the past year related to offers.  So here are 10 of the top membership marketing offers that have worked for our clients.

1. A discount almost always is the top offer in membership marketing. The amount of the discount must be appropriate to the product/situation. Generally a discount should be 15%-35% and move the rate below a price point. In membership acquisition, a properly developed discount will produce both more new members and more total revenue.

2. A “no-risk” or “no-obligation” offer will almost always out pull a “hard” (pay now) offer. It usually works best with organizations that have a lot of “mail box” benefits and higher priced dues. Accepting the no-risk offer includes the right for an invoice to be sent out and either paid or cancelled by the responder.

3. A product voucher offering new members $75 to $100 in savings on any purchase from the association can make a lot of sense. It has a high perceived value and helps the new members engage the organization with a second purchase right after joining. Typically, these vouchers will see a 20% redemption rate. So in theory the voucher can be 5 times higher than a discount.

4. Sweepstakes increase front-end response by 35% or more, but may decrease total paid response. Sweepstakes work best for impulse items, e.g., magazine based membership, contribution to a charity.

5. Premiums (free gifts) rarely beat discounts, but off-the-shelf items can be used at such little added expense that they make economic sense. The best premiums appeal to the self-interest of the reader (e.g., special reports or a salary surveys).

6. Offering more of the product can increase response (e.g., 15 months of membership for the price of 12). But generally this works best in markets where the product is already well known to the reader (e.g., qualified prospects, and former members).

7. A free trial offer will usually out pull a hard offer by at least 3 to 1 on the front end and 1.5 to 1 on the back end. But the key to making it work is developing a back-end conversion series to move the trial members to paid members.

8. A shorter term offer (e.g., 6 months membership) will pull up gross response, but beware; it may not increase response enough to cover the added costs of the extra renewal and loss of some buyers after the initial term sale.

9. Guarantees (i.e., money back if not satisfied) has become a basic “have to have” offer that is added to increase the confidence of the buyer. There is usually very little redemption on a money-back guarantee. If members do not like the product, they simply do not renew.

10. Installment billing with EFT or automatic credit card charges is performing very well for many organizations. This option turns a $239 membership into an easy monthly payment of $19.91. You do not pay for your cell phone or electricity up front, why should you have to pay your dues in one lump sum?

Okay, here is a bonus item.

11. Every offer should include an “upgrade option.” An appropriate upgrade can attract 10% to 30% of the respondents to it. Offer a member an additional newsletter or an association book club option. We discussed some options in Growing Revenue through Membership Packaging.

When trying any special offer, it is important to make sure that your back end operations support what is being offered up front.

If you need help in finding a compelling offer to drive up your membership response rates, feel free to contact me.

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This entry was posted on Tuesday, December 28th, 2010 at 4:38 pm and is filed under Tips & Insights. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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