Lighthouses. We’ve all seen them (or at least seen pictures of them). Tall, majestic brick structures with lots of glass at the top. Great tourist destinations, but do they serve any purpose in today’s modern world of GPS and computerized navigation? Likewise, with all of our modern membership marketing tools—email automation platforms, landing page AI testing, smart subject lines—one might suppose that a formal membership marketing strategy is a thing of the past. Our tools do all the work for us, right?
Not so fast.
Both lighthouses and membership marketing strategies still firmly have a place in this world, but with your membership marketing you need to understand the difference between a goal, a strategy, a plan and a tactic.
Getting from A to B
As a former naval officer and aviator-turned-marketing-executive, I’ll ask you to trust me that this seafaring analogy will make sense as you read further. “All aboard” and let’s explore what makes lighthouses and membership marketing strategies similar.
You may sometimes hear—from a board member, a CEO or even your boss—a mandate like “Grow membership by 10% over the next five years.” And those same people may think that they have just handed you a “membership marketing strategy.”
A mandate is not a strategy at all, but let’s understand why: If you are a captain of a ship and are told to sail from New York to Miami and arrive in two weeks—is that a strategy? Is there anything other than a destination stated in that sailing order? That order is a goal. You have a destination and a timeline. But there are many more essentials needed to make that goal happen.
Goals are great—they tell you where you are headed (and in both our marketing and nautical examples, how much time you have to get there). But they do not provide you any additional insights, knowledge or direction. The captain of the ship must make many additional decisions to reach that goal and those decisions need to be made in a particular order with dependencies between them. There are many ways to get there. There are many factors like tides, weather, and harbor schedules that all must be taken into account.
If you are to achieve your 10% growth goal in the next five years—you ALSO will have many factors that you have to assess and decisions you will need to make. But before getting too mired in the details, we should probably understand the big picture about membership growth.
Two Levers to Drive Your Membership Growth
There are only two primary factors that drive membership growth: Acquisition and Retention.
As the captain of your membership marketing ship, you can ultimately pull on one or both of those levers to change the size of your membership. You can try to improve your retention rate resulting in more retained members each year. You can try to increase the acquisition of new members resulting in more new members as well. You can try to do both.
You may even find that pulling one lever causes the other lever to go in the opposite direction. For example, a typical outcome with large new member acquisition rates is that your overall retention rate will fall.
Because new members retain at a much lower rate than your overall average for most organizations. By filling the rolls with many more new members, you likely experience a decline in overall retention rate when that first term ends. (For more on defining and calculating retention rates see this article.)
What Are Your Constraints?
You will also have budget constraints. Growth needs fuel—almost always in the form of money. We often see that an organization is doubly challenged when it comes to growing membership. The sudden focus on growth is often the result of stagnation or decline. This directly impacts dues income. Budgets become tighter. And that membership growth mandate had no considerations regarding cost when it was handed down.
So—you have levers to pull and money to spend. Do you have a strategy yet?
You don’t, because you haven’t balanced those levers and costs to match your current situation. If you have done a good job of tracking current performance, you may decide that membership retention has improved each year for the last three years and is at an all-time high. Would it make sense to strive for even higher retention rates? Probably not.
In our illustration download, we have created a notional organization of 1,000 members that has a blended member retention rate of 85% and is stable at 1,000 members. The organization has a 60% retention rate on first year members which means its retention rate on everyone with 2 or more years of tenure is actually 89.4%.
It seems unlikely that if the 2+ year member retention rate has risen to 89.4% over the past three years, that we can rely on further improvement. For the sake of this illustration, we will also assume first year member retention improved to 60% over those three years, so it also is unlikely to improve.
That means we will have to pull hard on that member acquisition lever. How hard? As you can see in our illustration, we would have to improve by 34% over 5 years in order to achieve the 10% member growth mandate.
What is the current average cost of member acquisition? What kind of member acquisition growth is required to get that overall membership growth of 10% in five years? The organization’s experience tells us that 1) it is unlikely they will be able to achieve a 6% improvement in the first year they try to improve acquisitions and 2) they do not have enough budget to allocate to that kind of growth based on their assumed member acquisition costs.
Charting Our Course
We are “savvy ship captain’s” and perhaps there is another way. Instead of proposing 6% growth in the first year—a more reasonable and achievable target is 3% growth with a modest budget increase. Then earmark the increase in dues revenue for the following year as incremental acquisition budget to achieve 6% in year 2 of the plan. Following this logic, incremental budget increases each year after that would support 8% growth in Years 3, 4 and 5. And with that we have a plan for 10% membership growth.
Thus—we have charted our course from New York to Miami. We’ve factored our ship’s speed (our current retention rates), our headwinds (the drag that the additional new members will have on our overall retention rate) and our fuel (the budget we have to work with).
Now we have a strategy. We not only have a goal (10% membership growth) but we have parameters to get us there. We’ve charted our course!
Back to that lighthouse. Think of a lighthouse in Miami. There it sits—unmoving. Just like our 10% membership growth mandate.
It is the object we are aiming for—no matter what happens. Even though we have charted our course, we have yet to talk to our engineer about speed, the navigator about forecasted weather, or the home office about how much fuel we will have in our tanks at the beginning of the trip.
Our membership marketing mandate remains fixed—like that lighthouse—and we have a strategy to get us there. Improve acquisitions—funded by dues revenue increases, while holding retention the same.
You Need A Plan (or Plans)!
The ship captain now needs to start making more specific decisions. What time is high tide and when does he leave? Are the ocean currents going to force him closer or farther away from shore? Is there a major storm brewing in a few days that he must navigate around or through?
Like the captain, you have decisions to make about how you execute your marketing—do you need new marketing creative? Will the cost of your email marketing platform change your decisions? Have you had a windfall of new prospect name sources? From your strategy—you can develop marketing plans. Marketing plans drill down on the specific actions and timelines for the first leg of your journey (Year 1 of the strategic plan).
Marketing plans contain the “What, why, and how much?” level of detail that is not in a marketing strategy. Plans contain enough detail to tell you what you are doing next but not all of the specific details of executing. For that you need our lowest level of plan—a list of specific tasks—marketing project plans.
Ships often publish the “Plan of the Day” for the crew. The P.O.D. will tell the crew what time to get up, what the major tasks are for that day—for example maintenance or training—and will typically update them on where they are and where they will be in 24 hours.
Just like the P.O.D., the marketing project plan will provide very specific details on WHO will be involved, WHEN they will need to be involved, their task DUE DATES, and the specific outcome that this project is designed to achieve. These are your marketing tactics.
For example, a new member acquisition tactic might be to increase the frequency of email solicitations and to do an A/B subject line test on each deployment. You would never find this level of specificity in a membership marketing strategy and might only see it as “email A/B testing” in an annual membership marketing plan. But the project plan would lay out the days these deployments will happen, who is deploying them, who is reading the results and when the decision to change the “control” subject line needs to be made.
Look to the Horizon
How does the lighthouse help us as we are working “down inside the ship” deploying A/B tests? Sometimes we all need to go up to the upper deck and look around. Where are we and where are we heading? Did the wind blow us off course? Are we behind? The lighthouse will tell us—it is the enduring guiding beacon throughout our 5-year journey.
Your goal is to achieve 10% membership growth. Maybe email marketing won’t get you there and you need to adjust and try something else. Maybe your budget only got approved at 90% of your request and you need to chart a slower course until you can get some more fuel (improved budgets in subsequent years). But you are always looking towards that beacon to remind you of what you are really aiming for.
Too often, we see marketing departments absorbed in the swirl of short-term “marketing plans” or even plans of the day (project plans) and there doesn’t seem to be anyone looking to the horizon for the lighthouse that should be guiding their way.
Or worse—no one declared the destination. The order to go to sea was given so everyone is furiously managing their part of the “ship” with no idea where they are going or who is driving!
Are you the captain of your ship? Do you know which lighthouse you are aiming for? Have you gone outside and looked for it instead of just “trusting” that your marketing automation systems are taking you to the right destination?
It truly can make all the difference in the world.
Author’s note: As a naval officer and naval aviator, I’ve had years of ship and airborne navigation training, planning and execution. The lighthouse analogy may seem archaic, but rest assured there are ship captains every night looking at over 800 active lighthouses in the United States and thousands of aircraft captains looking for that Green & White blinking beacon that tells them where the airport is with their own eyes. Both ship and airplane captains have many electronic instruments at their disposal and sometimes they may not have the luxury of putting their eyes on that beacon—but any time they can, they do! There is comfort and confidence that comes from knowing you are looking at your destination with your own eyes!