Retention not recruiting
Membership is a great business model in concept. You get a customer and your customer renews each year.
The key to retention is what happens AFTER your new member joins. Handling your new member correctly can increase your new member lifetime value by three to ten times. With a higher lifetime value, you can invest more to get new members. With more members, you get more referrals.
How to transform your membership program from a series of “one-night stands” into a tribe of lifetime relationships?
Retention point
We have Lifers and we have Quitters. The Retention Point is the moment when your members become so emotionally invested in what you deliver, they become Lifers.
Most Membership Marketers think they may have one or two competitors in their niche that are selling a similar product to a selected group of customers. Fact is, your competition is a lot bigger, a lot better financed and way ahead of you. You are competing with the best attention seekers in the world.
Membership Marketers leave the Retention Point to chance. Getting your subscribers to the Retention Point faster is the secret to slashing churn rates. Moving your Retention Point earlier in your subscriber life cycle is the key to long-term growth.
You move subscribers to the Retention Point by:
- Inspiring them to improve themselves.
- Giving clarity over their pathway to improvement.
- Helping them take the first step.
- Revealing your unique personality.
Membership marketing mistakes
Mistake number 1. Giving Members More Value. Value is like water. Too much water is just as bad as too little. Delivering too much value to member, he gets overwhelmed and feeling bad because he is not using it.
Mistake number 2. Sending Gifts to Make Them Feel Obligated to Stay. They didn’t join for cookies; they join to solve their problem.
Mistake number 3. Using “Pain of Disconnect” Benefits to Stop Them from Quitting. Members join when they are attracted to a transformation opportunity: they stay when they share your beliefs and your mission to improve the world. Membership is a relationship. Relationship trumps message.
Mistake number 4. Showing Them Exactly What to Do, Step by Step. Your members won’t use what you deliver until they understand why.
Mistake number 5. Sending New Members, the Same Stuff Everybody gets.
Member Leaders
Ten Retention Point Accelerators:
- VALUE is like water.
- EVERY member contact is a sales communication.
- Begin by promoting the END.
- Your relationship begins AFTER you make the sale.
- LEAD, don’t teach.
- Member On RAMP™ gets new member up to speed.
- Solve problems to deliver member TRANSFORMATIONS.
- Your value is the FEELINGS you deliver, not the stuff.
- It’s ALWAYS about THEM.
- RELATIONSHIP trumps message.
You can’t take it for granted that because your member was excited enough to buy your service, that he is going to be just as excited later, when it’s time to pay the credit card bill. Your relationship begins AFTER you make the sale.
Rather than talking about what you deliver, focus on what your members must believe to become your long-term members. This is what your “Member On Ramp” is all about.
How you welcome your new members determines whether or not you’ll succeed through the Credit Card Moment of Truth to reach the Retention Point.
Use cases lessons
Charity Water is one use case, trying to convert one-time donors into recurring revenue.
Memberships are one of the most difficult offers to convert. A customer will often spend more to avoid the commitment of a subscription.
Too many membership programs position a library of information as their primary membership benefits. Maybe 50 years ago there was a problem with a lack of information. Today the problem is too much information. Today you don’t win with bulk.
Create an on-boarding product that delivers a member transformation. Then market that new member on-boarding system as a bonus that increase sales conversions on the front end.
Recurring revenue growth comes from new member retention. Not new member acquisition.
Free trial period is time to foster relationship. The goal is conversion.
The more you are asking your new member to do within the first few hours of days of your membership, the more difficult it will be to get that new member to the Retention Point.
Most SAAS companies do have a higher long-term retention rate than other subscription businesses. Within the SAAS world there’s a lot of discussion about creating Customer Success. Some mistakes they are making in On Ramp period. The Apology. Your newest member doesn’t know about yesterday’s problems. The New Feature. Your newest member doesn’t need to know that your product didn’t have these features in the past. Start with teaching. Don’t teach, video can do that. Make the outcome that’s waiting on the other side of the task, as clear and as exciting as possible.
When benefit of the outcome appears greater than the pain of the work, your member will be at the Retention Point.
You cannot merely deliver the product; you must also communicate how what your deliver will enhance your member’s life. Rather than delivering more stuff, it’s more important to help your members understand the value of what you are already delivering.
Steps to the Retention Point
Key components of your new Member On Ramp:
- Dream.
- Belief.
- Goal.
- Time.
- Focus.
- Curriculum.
- Win.
- Recognition.
- Upsell.
Every proposition must promise transformation.
Once your new member buys your subscription, your Member On Ramp has two jobs. First, stop your member from quitting and asking for a refund. And second, get your member engaged so he’ll want to continue his subscription.
Dream. Your new member thinks more about what it’ll feel like to have his problems solved than he does about the investment necessary to make it happen.
Belief. Your member believes your solution works and it’ll work for him.
Goal. Instead of being overwhelmed by the size of the journey, your member recognizes the value in taking the first step.
Time. Your member schedules time to implement your solution.
Focus. Your member eliminates all possible alternative problems and solutions; he puts all of this energy into implementing what you provide.
Curriculum. Help your member visualize himself implementing your solution by illustrating the steps in your journey so he can easily track his own progress toward his goals.
Win. Build confidence with simple tasks that deliver the fastest possible first win.
Recognition. Engage your member into your community by delivering recognition opportunities.
Upsell. Invite your member to accelerate implementation by investing in additional products and services. There are two keys to making upsells really work as part of Member On Ramp. First, you must always deliver what your promised as part of the initial sale, and make it awesome. Second, position the upsells as an accelerator for the core transformation.
New membership
Selling new membership is hard. Although membership and subscription businesses are popular start-up concepts, selling a subscription offer to a customer is one of the most challenging sales to make.
Optimizing each step in your New Member Journey is the fastest way to identify your biggest membership growth opportunities.
Tools
Your number 1 tool for accelerating new members to the Retention Point is your 100-Day Communication Plan.
New Subscribers divided by Churn Rate equals Subscription Growth Ceiling. When you are losing about the same number of members that you add to your subscription, growth is going to slow down and stop. Every subscription business faces Subscription Growth Ceilings.
