Member retention is more valuable than member acquisition. Some people say it costs five times as much to earn a new member than it does to retain an existing one. Others say that retaining members is seven times more valuable. And finally: “Acquiring a new member is anywhere from five to 25 times more expensive than retaining an existing one.” Okay, so perhaps the exact numbers are a little fuzzy. The point, though, is that member retention is cheaper, more profitable, and in lots of ways easier than member acquisition.
In this article, we’ll answer:
- What does member retention mean?
- What are some proven member retention strategies?
- Which automation apps improve retention?
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What is Member Retention? Member Retention Definition
Member retention, or client retention, is the process of turning prospective and existing members into repeat customers.
The word “retention” stems from retain, and retain is basically just a fancy way of saying keep.
So, the goal of member retention is to keep your existing members. The goals and methods of retaining members can vary by club type: A club that sells a high-end golf experience will have different member retention strategies than a social club in the city.
But for all sectors, the idea is to provide a level of quality and service that keeps people coming back – member retention perfected.
What Are Member Retention Programs?
Member retention programs are simply activities and tactics private clubs take to improve the member experience.
The objective of these programs is to encourage members to keep coming back while also advocating for the Club’s products and services.
Let’s dive into some of the member retention tactics that will give your members the incentive, opportunity, and desire to come back to your Club for another visit.
Why Is Member Retention Important?
Aside from the fact that it’s more expensive to acquire new members than it is to keep existing members, there are many other reasons that member retention is important.
Retained members can help reduce your marketing costs. Sure, happy members are return members, but they also tell their family and friends about you. Word of mouth advertising drives more membership referrals than paid advertising, up to five times more.
The trust you get from your happy members will drive more membership referrals, decrease your advertising costs, and save you money.
You don’t want to be that flash-in-the-pan startup. You want real, organic growth that ensures future revenue.
Benefits Of Member Retention
Here’s a quick rundown of the benefits you’ll see from implementing retention strategies for members:
- A five percent increase in retention rate will increase profits by 25-95 percent, according to Harvard.
- Builds brand awareness and reputation by word-of-mouth advertising from your loyal members.
- Gives you the opportunity to build constructive relationships with your members.
- Allows you to identify and fix flaws by receiving feedback and listening to your members’ needs.
- Loyal members are more willing to try or experiment with your new products. Six times more likely, according to studies.
- Your members are more willing to be forgiving of mistakes if they feel loyal to you, which means fewer of those fly-off-the-handle angry members.
Member Retention Metrics and How to Calculate It
Before you start creating a member retention plan, you need to know and understand your current member retention rate. This number tells you the percentage of members that are sticking around.
Your member retention rate is easy to calculate with the following equation:
((Number of members at the end of a period – number of members acquired during that period) / number of members at the beginning of the period) X 100 = Member retention rate
Let’s break it down.
First, define the period. The time frame is completely up to you – it could be monthly, quarterly, yearly, or whatever works best for you and your Club.
Keep in mind that when calculating the number of members at the end of the period, you have to take member churn into account.
For example: You have 1,000 members at the beginning of the year. You acquired 500 new members during that time, but lost 300 due to churn. That means that at the end of the period you have 1,200 members.
The equation would look like this:
((1,200 – 500) / 1,000) X 100 = 70
Member Retention Rate = 70%
Why is this number so important? It tells you how well you’re able to keep your members coming back for more. For a benchmark, membership retention rates for golf and country clubs hover around 94% to 92%, while city and yacht clubs can be as low as 88% to 86%.
How to Improve Member Retention: 10 Best Practices
There are a lot of ways to carry out membership retention marketing. From interacting on social media, email marketing, and setting realistic expectations, here are the best practices for increasing your member retention rate.
1. Exceptional Customer Service
Many Clubs assume exceptional customer service can only be achieved by going above-and-beyond — that loyalty is built on showy gestures.
But according to research from Dixon, Toman, and DeLisi published in The Effortless Experience, the true driver of customer and member retention and loyalty is the ease of getting a problem solved and setting the bar for member expectations.
Delight isn’t the foundation of a customer service strategy; it’s a second-order effect. First, focus on consistently meeting expectations and avoiding unpleasant surprises. Then go the extra mile. Here are a few more tips.
- Provide support on the right channel(s). It’s important to make sure you’re providing support on the channels that make the most sense for your Club and your members. Social and city clubs, for example, know that live chat and text messaging is critical when their members have questions; while golf and country clubs may have members who prefer using self-service, or even phone support.
- Make member support a communal effort. Countless case studies have made one thing clear when it comes to creating an efficient support system: you need to keep everybody in the loop.
2. Create a Loyalty Program
A member loyalty program should be an integral part of your member retention system. These programs reward your members by giving them incentives to come back and play, dine and hang out with you.
Once your members opt into your loyalty program, make them feel special by hooking them up with offers: Give them a sneak peek at new wines, upcoming menu additions, course equipment, and offer exclusive deals. This royal treatment will help your members to feel valued, and is the crux of this member retention strategy.
You can even give someone loyalty program-esque benefits before they have opted in. For example, you can offer each member a discount code inside of their tee-time confirmation with a guest, in an email to encourage merchandise sales before they tee off.
Don’t make them sign up for anything – just get them the discount straightaway.
If you offer your members value without any cloaked agendas after they’ve made a purchase, it’ll go a long way to improve member loyalty and retention.
3. Pay Attention to Questions
You know how you sometimes need an extra set of eyes to edit because it’s impossible to spot your own typos? The same thing can happen with your Club: You designed the member journey, you built the menus, you set the prices. In short, you understand everything about your Club because you’re the one who planned it out.
Which is exactly why we can’t always see what we did wrong. At least not as well as our members can.
Paying attention to questions about your Club is a great way to keep your members, and a simple member retention technique.
For example, if someone asks a question that you thought was obvious, that’s your clue that maybe it isn’t actually so obvious.
Or if they ask a question that you already explained, then maybe you didn’t explain it clearly enough or loudly enough.
Make members feel comfortable enough to ask questions. The more comfortable they feel, the higher your member retention will be.
Plus, it’s like they say – feedback is a gift.
So, listen to those questions and remember that if one person is asking it, others might be as well.
And listening is a great way to improve member retention – if you know what the problems are, you’ll have a much better chance to fix them.
4. Pay Attention to Complaints
The reality is: member retention depends on member satisfaction.
If your members are unhappy with the service that you provide, why would they continue to come back?
This means that every complaint you receive is like a mini member satisfaction survey, so make sure that you use them to improve your member retention rates.
Essentially, if you get a complaint, don’t ignore it. It’s best practice to take care of it as soon as possible and make sure you satisfy your member’s needs.
You could even take steps to make it simpler for members to submit complaints. Put a member feedback page on your website, throw a banner about feedback in your member email in the footer, and make sure that you’re available on social media.
Use insights from member complaints to make the next member’s experience better.
5. Be Active on Social
If your members forget about you, you can’t retain them. And there are few better ways to stay top of mind than engaging with members on social media.
If social is going to be part of your member retention strategy – and it should be! – then bake it into the member journey. Put social buttons in your footer, on your reservation confirmation page, on your contact page. Everywhere.
When members compliment your club on social, thank them for the kind words and then share their love with the rest of your followers – this is a great member retention strategy.
You can also improve your member retention rates by announcing new services, products, merchandise deals, and other updates on social.
There are loads of apps you can use to automate and optimize your social media engagement, and creating a social media marketing plan is pretty easy. You can even put your social buttons in your emails.
6. Target Members on Social
Social media can help with member retention by letting you target past prospects and member’s guests. With Facebook and Instagram, for instance, you can create target audiences based on pages that members visited – like, say, a “Thank you” page after playing a round – or on certain events.
When it comes to member acquisition, so much of the targeting that clubs do on Facebook is guesswork, at least initially.
They’re educated guesses though, at least, which are based on locations, or age groups, or interests, or gender.
But when you use social media to target members, prospects and past guests, it removes the guesswork.
You know the people on the receiving end of these ads visited your club, making social targeting a valuable tool for your member retention strategy.
So, give this tactic a try – we’re sure that you’ll see the importance of member retention if you can generate some results.
7. Use Email
Each email you send can aid member retention — even when you’re sending emails that aren’t really about retaining members.
We talked earlier about how important setting expectations is. Well, every email can be part of that process. The reservation confirmation, the order arrived confirmation, the follow-up thank you.
These are great opportunities that you can use to set expectations, engage members, and increase your member retention rate.
Use segmenting to better communicate with your members. For example, you could create segments based on the specific member interests, services they recently used, how much they spent, whether they used a discount code, and so on.
It seems like email is becoming less popular, at least among certain demographics. But that’s not necessarily a bad thing for your member retention strategy.
As personal communication keeps moving to iMessage, Facebook Messenger, Snapchat, and WhatsApp, emails might become less intrusive: They won’t be competing for real estate with messages from friends and family.
That means your emails will have a higher chance of helping you hit your goals, and if they’re done right, you’ll be able to improve member loyalty and retention.
8. Market to Your Member’s Interests
Whenever we talk about member retention, one thing is clear – your marketing materials must be aligned with your member’s interests.
Why?
Well, if you’re looking to improve your member retention rate, you’re not going to do that by sending your existing members emails which have nothing to do with the things which initially drew them to your club.
Or, if you’re thinking about trying out some new content on your social media channels, it’s important that you assess why your followers liked your content in the first place. Is the new content that you want to post going to jeopardize that existing relationship?
These are risks which you may need to take on your membership journey, but make sure that they’re calculated risks. When it comes to member retention strategies, sticking with what your members know, not what you know, is generally a good policy to stick with.
9. Engage in Social Responsibility
As we’ve mentioned before, high member retention rates hinge on your members feeling good – not only about the services they’ve interacted with in the past, but also with the full membership experience.
That includes price, quality, communication, and so on.
But you can also make members feel good by letting them know that they are doing good. This is where social responsibility can have an impact.
Social responsibility refers to activities that help people in need. And lots of clubs and resorts do a brilliant job of incorporating social responsibility into their business – and letting members know about it.
You may be familiar with Patagonia, the outdoor clothing company. Patagonia operates several programs that make their members feel like they’re making a difference, just by purchasing the brand. These programs include Worn Wear for garment repair and recycling, Patagonia Action Works for supporting grassroots activists, and they also provide environmental grants.
Talk about building brand loyalty while increasing your retention – if you’re seen as a brand that’s doing good for the world, it’s a lot easier for your members to back you.
After all, when your members know that every item, they buy will help a good cause, you’re giving them an incentive that goes way beyond reliable shipping.
10. Be Honest
Our final member retention strategy is a simple one, and it’s one which you’ve probably been taught throughout your whole life.
Be honest. It’s as simple as that.
It might sound a little vague at first, but there are a lot of people out there who have been burned by membership clubs before.
Whether that be through unknown charges, difficulty making reservations, getting a tee time, or something else, people are quick to lose trust nowadays.
So, make sure that you provide your members with an honest experience when they’re spending with you.
All in all, try to treat your members how you want to be treated – this is one of the best ways to improve member retention rates for businesses of all shapes and sizes.
Member Retention Tools
Alright, not all ten of our member retention tips can be automated with apps. There is, for example, no app for social responsibility, or for setting clear expectations – you’ll need to manage those member retention strategies yourself.
That said, lots of the nitty-gritty work involved can be automated. Here are some apps that could give your member retention strategy a boost. (Note: There are many, many more apps than these. Think of this list as an automation appetizer.)
Member Relationship Management Software
ClubCRM combines member prospecting, club communication, wedding and tournaments forecasting, text messaging and more, all in one tool.
Social media apps
Instagram Shop specializes in shoppable Instagram posts, letting people buy products that appear in your Instagram feed.
Kudobuzz can aggregate and display social testimonials from your members on Instagram, Facebook, Twitter, and more.
Summary: How to Retain Members in 2022
Many clubs focus on attracting new members, and while you need new members, it’s just as important to nurture your existing base.
So rather than gearing all your marketing budget towards acquiring new members, put some effort and money into building relationships with past buyers. These people already know your brand and will appreciate that you’re focusing on them even after they’ve joined the club. Here are the 10 best member retention tactics that you can implement to keep buyers around.
- Have Exceptional Customer Service.
- Develop a loyalty program.
- Pay attention to members’ questions.
- Dig into the complaints.
- Be active on social networks.
- Target past members based on their activity.
- Use email to nurture relationships.
- Market to members’ interests.
- Engage in social responsibility.
- Be honest and transparent.
Which of these member retention strategies are you currently using? Let us know in the comments section below.
