What's a good retention rate?
This tidbit came over the ASAE communications listserv yesterday, and I was kind of taken aback to actually find some great content! It's from Stephen Carey, who's president of the Association Management and Marketing Resources group. It's in response to a question that asked for "a summary of averages and ranges of association annual retention rates." The person asking said they felt like an idiot for asking, but I don't think it's a weird question at all. I think that kind of info is kept close to the vest. It reminds me of a saying about innkeepers that they'd rather talk about their sex lives than their occupancy rates. Anyhoo, here's the quote:
Most of the surveys for both trade and professional associations find that the average retention rate falls between 82% and 90%. The average rates 5 years ago were a percentage point or two above this. Some groups are running above 95% and others below 70%. If you are running below 85%, you probably need to tune up your retention machine and develop additional incentives, which address your value equation. If you running below 80% your value equation is probably in need of a major overhaul. Benchmark several like associations in your industry and use the average as your guide.This bit of information is good for me to know. I know I'm trying to stop the bleeding right now. But the question still remains, what are some good sources to research this kind of thing? I haven't seen it in anything from ASAE, but maybe I've overlooked that.
Our rule of thumb, is that if your combined membership rate after drops and adds is 3% or better on average, you're probably doing ok. We would also recommend that you figure your "true retention rate," which is your drops minus those drops that have changed fields, passed away, have budget problems or other issues you cannot control. This will give you the best guage as to whether your value proposition is out of whack and you really have a problem.
The most important thing in association membership first aid is to "stop the bleeding." This means spending as much if not more on the retention program as you do on the recruitment program. If you don't, you're just throwing new members into a net with a hole in it and you are wasting your recruitment dollars. We still find many association that have not mastered this piece of strategy yet.