2012 MGI Membership Marketing Benchmarking Report Presented by: Rick Whelan

What are the Trends in Association Membership? 2012 Membership Marketing Benchmarking Report Fourth Year Produced by MGI Over 691 Participating Associations Up Front Disclaimer  What not Why  Correlation not Causation

Research Goals 1.Gain an understanding of the membership marketing practices of associations 2.Determine the challenges in membership marketing faced by individual membership and trade associations 3.Define what practices they believe are most effective 4.Understand through cross tabulation with new member, renewal and growth numbers what practices correlate with better outcomes

Research Methodology 1.Survey open from January 24, 2012 to March 3, 2012 – 6 Weeks Total 2.5,862 requests to participate % response rate with 691 participating associations (one response per association) 4.Margin of error + / - 3.7% with a 95% confidence level

Section 1: Association Statistics “Is Association Membership Dead or Dying?”

CHANGE IN NEW MEMBER ACQUISITION OVER PAST YEAR — COMPRESSED 2012 (N = 687) 2011 (N = 638) 2010 (N = 405) 2009 (N = 325) Percentage Increased Overall60%57%42%49% Percentage Unchanged Overall17%21%20%22% Percentage Declined Overall14%16%26%21% Percentage Unsure10%8%12%10% CHANGE IN MEMBERSHIP OVER PAST ONE YEAR—COMPRESSED 2012 (N = 689) 2011 (N = 642) 2010 (N = 405) 2009 (N = 331) Percentage Increased Overall52%49%36%45% Percentage Unchanged Overall16% 14%16% Percentage Declined Overall29%34%48%35% Percentage Unsure3%2%3%5% CHANGE IN RENEWAL RATE OVER PAST YEAR — COMPRESSED 2012 (N = 683) 2011 (N = 638) 2010 (N = 403) 2009 (N = 326) Percentage Increased Overall36%32%21%22% Percentage Unchanged Overall33%37%27%39% Percentage Declined Overall22%24%44%31% Percentage Unsure10%7%8%9%

TOP CHALLENGES TO GROWING MEMBERSHIP 2012 (N = 683) 2011 (N = 631) Membership too diverse; difficulty meeting needs of different segments26%N/A Difficulty attracting and/or maintaining younger members24%N/A Insufficient staff24%16% Perceptions of the association and/or its culture (i.e., old boy’s network, not specialized enough, etc.) 24%N/A Insufficient budget21%13% Changing demographics of industry18%N/A Weak product or service offerings18%13% Lack of strategy or plan17%11% Competitive associations16%N/A Industry consolidation14%N/A Inadequate association management database13%8% Inadequate research to understand market10%7% Lack of marketing expertise10%7% Market saturation10%9% Difficulty in converting student memberships to regular memberships9%N/A Lack of integration between national and chapters8%N/A Misalignment of goals between board and executive staff4%N/A Economy3%N/A Poor customer service1%N/A Other12%16%

Section 2: Membership Lifecycle TM Strategies “What’s working in membership marketing?”

Membership Awareness

METHODS FOR CREATING ASSOCIATION AWARENESS 2012 (N = 683) 2011 (N = 638) 2010 (N = 405) 2009 (N = 599) 94%71%67%61% Association website92%87%88%85% Word-of-mouth recommendations83%90%91%77% Promotion to/at your own conferences/ conventions79%65%66%65% Advertising in your own publications72%48%56%51% Association-sponsored social networking sites (e.g., Facebook, LinkedIn)71% 51%56%35% Direct mail69%62%66%76% Association-sponsored events68%57%56%37% Cross-sell to non-members who buy your products or attend your conferences61%56%59%52% Exhibiting at other conferences61%50%51%53% Public relations61%40%39%29% Local events/meetings60%53%N/A Search engines (organic)48%45%47%34% Advertising in outside publications47%31% 28% Chapters42%38%46%39% Job board39%24%23% Personal sales calls32%25%22%24% QR codes30%N/A Accreditation promotion24%18%20%14% Telemarketing22%16%18% Paid banners on other websites21%12%13%12% Mobile apps20%N/A Search engines (paid or pay-per-click)20%14%20%8% Radio or TV15%7%5%7% Texting6%N/A Other3%4%3% Do not know1%0% 1% How does your association create brand awareness of your organization? Top three methods for creating brand awareness. Blue: Upward trend

SOCIAL MEDIA OUTLETS OFFICIALLY USED BY ASSOCIATIONS 2012 (N = 685) 2011 (N = 641) 2010 (N = 405) Facebook86%91%75% Twitter79%71%66% LinkedIn (Public Access)56%53%59% YouTube53%45%35% Association Blog30%27%30% LinkedIn (Members Only)30%28%N/A Association Listserv22%24%31% Private Association Social Network19%18%17% Flickr15% N/A Google+11%N/A Wikis8%9%13% Ning/Groupsite4% 6% Second Life1%2%3% MySpace1% 4% None3%6%8% Other4% 6% Which social media does your organization officially use?

Time to Achieve 50 Million Users 1.PrintHundreds of Years 2.Radio38 Years 3.TV13 Years 4.Internet4 Years 5.iPod3 Years 6.Facebook24 Months 7.Twitter 12 Months 8.Google+6 Months* *Stephan Scherzer, CEO, VDZ - German Magazine Publishers

Membership Recruitment

EFFECTIVENESS OF MEMBERSHIP RECRUITMENT MARKETING CHANNELS Marketing Channel Most Effective (N=685) Least Effective (N=630) Word-of-mouth recommendations54%3% 37%11% Association website34%7% Direct mail30%24% Cross-sell to non-members who buy your products or attend your conferences20%7% Personal sales calls17%7% Promotion to/at your own conferences/conventions16%9% Association-sponsored events16%4% Chapters14%8% Exhibiting at other conferences10%28% Local events/meetings10%5% Promotional incentives8%16% Association-sponsored social networking sites (e.g., Facebook, LinkedIn)5%18% Public relations5%11% Telemarketing4%13% Accreditation promotion4% Advertising in your own publications3%17% Advertising in outside publications2%25% Search engines (organic)2%8% Search engines (paid or pay-per-click)1%10% Job board1%13% Radio or TV1%11% Paid banners on other websites--14% Texting--5% Other3%

TOP THREE MOST EFFECTIVE AND LEAST EFFECTIVE MARKETING CHANNELS BY ASSOCIATION TYPE Individual Membership AssociationsPercentage Most Effective Word-of-mouth recommendations51% 39% Direct mail37% Least Effective Exhibiting at other conferences31% Advertising in outside publications23% Direct mail20% Organizational/Trade AssociationsPercentage Most Effective Word-of-mouth recommendations56% Personal sales calls37% 30% Least Effective Direct mail34% Advertising in outside publications28% Exhibiting at other conferences22%

REASONS MEMBERS JOIN ASSOCIATION 2012 (N = 684) 2011 (N = 641) 2010 (N = 400) 2009 (N = 303) Networking with others in the field22%25%24%22% Access to specialized and/or current information12%14%13%23% Advocacy12%10%11%N/A Continuing education8%7%11%5% Learning best practices in their profession7% 9%8% Accreditation or certification5%4% 2% Discounts on products or meeting purchases5% 6%9% Association publications4%3%6%3% Conferences/trade shows4%5%N/A Prestige of belonging to the association4%5%N/A Access to industry thought leaders2%1%N/A Advancing in their position2% 4% Members-only education2%N/A Access to career resources1% 3%1% Access to industry benchmark studies1% N/A Insurance (Affinity programs)1% N/A Not sure1% 2%N/A Other6%8%9%10%

Membership Engagement

COMMUNICATION METHODS USED TO ONBOARD NEW MEMBERS 2012 (N = 685) 2011 (N = 643) 2010 (N = 402) 2009 (N = 337) welcome72%71%72%62% Mailed welcome kit64%67%68%83% Membership card or certificate51% 59%58% Volunteer or staff welcome phone call29%30%32%26% In-person new-member reception or orientation25%23%20%19% New-member introductory series25% 27%14% Special discounts on purchases24%23% 17% Invite to chapter meeting22%18%25%23% New-member newsletter (print or electronic)16%15%20%11% New-member survey16%17%18%20% New-member gift (e.g., gift card, calendar, notepad)12%11%-- Custom new-member renewal series10% 11%7% Telemarketing welcome phone call10%12%10%4% New-member webinars9% N/A Early or “at-birth” renewal4%5%4%2% No special communication3%2% Other3%5% 8% Which of the following communication methods do you use to help onboard or engage new members in the association? (Check all that apply)

What proportion of your members do you estimate engage with your organization in the following areas EACH YEAR? AREAS OF ENGAGEMENT N0% 1%- 5% 6%- 10% 11%- 15% 16%- 20% 21%- 30% 31%- 40% 41%- 50% Over 50% N/A Attend your annual conference/trade show6441%12%13%11%12%11% 6%10%12% Attend at least one of your professional development meetings6631%12%13%10%9%10%9%6%9%23% Acquire or maintain a certification with your organization6662%9%6% 5%4%3%2%8%57% Attend at least one of your webinars6582%15%14%9%8%6%2%4% 36% Purchase a non-dues product (other than previously checked)6552%18%11%9%8% 3% 6%33% Purchase a non-dues service (other than previously checked)6583%17%11%9%7%6%3%4%6%36% Purchase or maintain insurance through your organization6582%14%5%3% 2% 1%3%64% Purchase a book or directory6532%19%10%6%5% 3%2%3%46% Participate in your public social network6663%25%21%13%10%8%5%3% 10% Participate in your private social network6603%20%13%7%6%5%4%3%2%38% Upgrade their membership6582%16%8%6%3%1% 2%3%58% Volunteer within your organization6642%32%21%14%11%7%4%2% 7% Donate to your association foundation or PAC6623%23%13%6%5%2% 1%2%42% Participate in your young professional program6562%16%8%4%2% 1% 67% Participate in your mentoring program6614%18%5%3%2% 1% 66%

Membership Renewals

What is your overall membership renewal rate?

What is your retention rate for first year members?

MARKETING CHANNELS USED FOR MEMBERSHIP RENEWALS 2012 (N = 685) 2011 (N = 644) 2010 (N = 405) 2009 (N = 333) marketing88% 83% Direct mail81%82%85%91% Staff phone calls53%52%49%56% Peer member contacts23%20%24%31% Telemarketing21%24%23%27% Magazine cover wraps17%15%N/A Board phone calls17%18%15%28% Social media contacts15%13%N/A Chapter phone calls13%14% 15% Fax9%10%11%17% Employer contacts6%8%7%4% PURL3%N/A Texting2%N/A Renewal app for mobile devices1%N/A Other3% 4% Which of the following marketing channels do you use for membership renewals?

How many membership renewal CONTACTS (such as mailings, s, phone calls) do you have in your renewal series?

RENEWAL RATES BY NUMBER OF RENEWAL CONTACTS INDIVIDUAL MEMBERSHIP ASSOCIATIONS (N=356) Renewal Rate 1-6 renewal contacts 7 or more renewal contacts Less than 80%49%44% 80% or higher51%56%

When do you start the renewal effort?

RENEWAL RATES BY START OF RENEWAL EFFORT INDIVIDUAL MEMBERSHIP ASSOCIATIONS (N=354) Renewal Rate Three months or less prior to expiration More than three months prior to expiration Less than 80%51%40% 80% or higher49%60%

When do you end renewal efforts (stop renewal contacts to the member)?

RENEWAL RATES BY END OF RENEWAL EFFORT INDIVIDUAL MEMBERSHIP ASSOCIATIONS (N=354) Renewal Rate 1-3 months after expiration More than three months after expiration Less than 80%51%43% 80% or higher49%57%

Do you offer any of the following renewal options?

REASONS FOR NOT RENEWING MEMBERSHIP 2012 (N = 687) 2011 (N = 639) 2010 (N = 400) 2009 (N = 333) Budget cuts/economic hardship of company17%N/A Lack of engagement with the organization14%N/A Employer won’t pay or stopped paying dues12%15%25%22% Could not justify membership costs with any significant ROI11%N/A Lack of value11%24%36%20% Left the field, industry, or profession8%12%N/A Too expensive5%14%11%22% Forgot to renew4%7%6%11% Lack of relevance3%N/A Company closed or merged2%7%N/A Disappointment with the benefits/services2%N/A Moved2%N/A Retirement2% 4% Can get materials from other members/other sources1%N/A Disagree with the advocacy position in the association1%N/A Lost job1%3%4%3% Poor customer service1%--1%-- Student memberships do not convert to full memberships1%N/A Switch to competitor1% -- Not sure2%6%2%4% Other4%9%12%14%

BASIC ANNUAL MEMBERSHIP DUES BY RENEWAL RATE Less than 80%80% or Higher Under $509%3% $50 - $9921%7% $100 - $14915%6% $150 - $19916%10% $200 - $29911%13% $300 - $3997%10% $400 - $4992%6% $500 - $7495%7% $750 - $9992%3% $1,000 and over3%7% Varies by company size9%29%

Membership Reinstatement

After a membership lapses or expires, how long do you continue to contact the member to invite them to reinstate their membership?

RENEWAL RATES BY HOW LONG ASSOCIATION CONTINUES TO CONTACT MEMBER FOR REINSTATEMENT INDIVIDUAL MEMBERSHIP ASSOCIATIONS (N=305) Renewal Rate 1-3 years after expiration More than three years after expiration Less than 80%51%42% 80% or higher49%58%

Section 3: About the Participating Associations

MEAN AMOUNT SPENT ON MEMBERSHIP MARKETING PROGRAMS BY NUMBER OF PAID MEMBERS Up to 1,0001,001-5,0005,001-20,000 More than 20,000 Acquisition*$17,643$34,632$101,931$503,470 Retention**$12,711$19,247$52,240$298,896 *Acquisition includes money spent on awareness, branding, and recruitment. **Retention includes money spent on engagement/on boarding, renewals, and reinstatement or win-back.

What association management software (AMS) do you use?

What types of analysis do you use to measure the effectiveness of your membership marketing campaigns?

Questions?