How many members does your association have?
It sounds like such an easy question but coming up with an answer can be tricky. And if you don’t trust your member count, can you ever be sure of benchmarks like retention rates, lifetime value, or member engagement?
So, who should be counted as a member? We think everyone would say – members who have paid their annual dues.
But what about recently lapsed members who just haven’t renewed yet? Or honorary members who are members but don’t pay dues? Or long-term lapsed members who only renew just before your annual conference?
Accurately counting your members requires you to consider several critical issues, including grace periods, benefits, reinstating lapsed members, and honorary members. If you decide to change your renewal rules, you’ll need to weigh what’s best for the association against what you can honestly defend when a member calls to question the rules. Here are some tips and tricks to help you ask the right questions to develop practical membership rules and make it easier to count your members.
Why Does It Matter?
We always consider the “why” of what we do. Membership in professional organizations is changing faster than ever, and associations are facing radical technological changes in general. Artificial intelligence and predictive analytics are forcing even the smallest association to reconsider how they will accomplish their goals.
What members need and how to deliver it to them are still the key questions, and the ramifications of the answers are growing. With larger questions looming, you don’t need to trip over routine tasks. Solving membership problems now will make tomorrow so much easier.
Why Are You Changing Renewal Rules?
Before you start changing things, ask why you need to change anything and make a list of your concerns. You can prioritize the list from most important to least, and it will help you better understand where the problems lie. Your organization’s culture will determine how you work to solve the problems but having clarity of purpose can help keep the project focused and on track.
Should You Have a Grace Period?
Business execs who don’t work in the association world set hard expiration dates. If you pay for Dropbox or Asana or Adobe Creative Cloud and don’t renew, you can’t use the product. Fortunately, software-as-a-service providers make it very easy for us to renew, especially with auto-renewal.
The association world, however, uses a much softer approach. We offer a grace period that varies from a month to six months to as much as a year with varying penalties. This approach is a gentle reminder to long-time members to renew, and the prevailing thought has been that more members will renew when given up to a three-month grace period.
But while your members enjoy their grace period, are they also enjoying member benefits? How many of them, on average, end up renewing? Do you know what your grace period costs the association? Lapsed members who eventually renew pay for their grace period, but what about those who do not renew? Are your member counts inflated during the grace period with members who don’t renew?
And now the big question … how do you handle members who don’t renew within the grace period but want to pay late in the 12-month period? Must they pay for the entire year? If they pay for the entire year, will you send them any missing membership premiums like journals, newsletters, and magazines or provide free access to virtual materials like recorded webinars?
That leads us to the next issue: Which is better – calendar renewals or anniversary renewals?
Are Annual Renewals Better Than Anniversary Renewals?
Not so long ago, the capabilities of association management systems often determined which renewal cycle an association would use. These days, most systems can handle either annual or anniversary renewals equally well. That’s good news for associations that don’t want to change their renewal cadences.
Renewals and grace periods seem to be easier for those with annual renewals when membership typically runs from Jan. 1 to Dec. 31. Annual cycles seem easier so long as their grace periods don’t extend too far. We’ve heard of associations chasing renewals throughout the year.
For many associations, membership expires at the end of the year and it’s not uncommon for these associations to offer a grace period. Let’s say that grace period lasts six months – that leaves your membership department reminding members to renew well into May or June. By shortening or eliminating grace periods altogether, you ensure that your staff isn’t chasing renewals all year long.
Ultimately, the decision is up to each association and what works best for you, but weighing all of the options gives you something to think about.
By contrast with annual renewal cycles, associations that renew memberships on anniversary dates may have a more difficult time writing easy-to-administer rules. For example, if members wait eight months or more to renew, should they have new start dates? If you give members new renewal dates each time, do you care that the member is “gaming” the system to get several months of free benefits every year?
And though renewing on anniversary dates produces revenue throughout the year, it makes it more difficult to reach out to members with special issues, such as student members moving into full membership or at-risk members in their first or second year. It’s true you must contact fewer members each time, but you must contact the at-risk group every month.
If you’re switching from a calendar renewal cycle to one based on anniversaries, your benchmarks and historical reporting will be upset. You’ll have to adjust your reports in order to compare annual results. Either system will work, but one may be a better choice to meet your goals.
Pro Tip: When your membership expires on one day like Dec. 31, position a renewal count prominently on your website through the renewal cycle. Association leaders will have immediate access to your latest numbers, and they can track renewals themselves. You can also include a bit of information about renewals, perhaps benchmarking against the previous year.
How Should You Handle Honorary Members?
Many associations honor long-time members or industry stars with special designations. Sometimes the honor includes complimentary membership. If you base your reporting on those members who have paid annual dues, you will fail to capture honorary members, skewing total membership counts.
On the other hand, you might not want to count honorary members when determining renewal rates Your reporting system should allow you to create standard membership reports while providing flexibility to include or exclude certain member groups when necessary. Then, you can get deeper and more accurate insights into your membership and renewal metrics.
So when is a member not a member? Ultimately, that’s up to each association, but working out the details now may help provide accurate data when you’re asking important management questions and planning for the future. Having confidence in the reports you use today will save you time and effort when you start asking your technology to think on its own.
