What a Crummy Car Lease Experience Can Teach Us About Membership Retention

Dan Stark, Director - Product Strategy

Wow - Really?

In December, we reached the end of a three-year lease on our Chevy Volt (best car ever)! Prior to ending the lease, the leasing company did an exhaustive inspection of the vehicle. After three years and 42,000 miles, the inspector determined we owed $125 for some damage to one of the wheels. He indicated he was required to report the damage to the leasing company, and they could decide whether to charge us or not.

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It Gets Worse....

In a call with the leasing company (a major financial institution), I also learned we owed roughly $400 for a lease termination fee. A lease termination fee? So I opened my mail today to find a bill from the leasing company for both the lease termination fee and the damage estimate. There is no argument based on the lease agreement, we owe the money. So essentially we will pay $525 to terminate our relationship with the company, and I can assure you that termination will be permanent.

Wait - What If This Was Handled Differently?

So just for a moment, let’s suspend what we know about banks, and pretend we are in an alternate universe where they care about customer retention. In that universe, we might have received a letter (not a bill) explaining that we owe the leasing company $500, and giving us the option of depositing $500 to open a savings account with them in lieu of the payment.
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Over the next 20 years, we use that bank to...

• Finance our daughters’ undergraduate and graduate education
• Finance the purchase of vehicles for our daughters
• Refinance our mortgage
• Downsize to a smaller house and take out a new mortgage
• Use short-term financing to pay for two weddings
• etc...etc...etc

Okay back to reality. Here is my check for $500… good riddance. ​

So What Can An Association Learn From This?

1. A little bit of marketing savvy could have a huge impact. How hard would it have been for the leasing company to think just a little differently about their communication to us? If you are sending membership renewals that look like bills - stop! Put a new spin on your renewals by highlighting the specific ways each member is getting a return on their investment.
2. Don’t lose track of long-term thinking in lieu of short-term gains. The impact of my $500 on this financial behemoth is miniscule not to mention the loss of goodwill it generated. The next time you come back from a conference with a pile of receivables for registration changes, consider allowing those attendees to apply all or at least a portion of the amount toward a membership or next year’s conference. Imagine the goodwill you are generating.
3. Understand the value customers place on the service you are providing. In the case above, we loved our Volt, and generally had a good experience with the leasing company. No one from the leasing company contacted us to see if we were planning to lease another car. Turns out we are leasing another Volt. Guess what leasing company we are not using? Failure to understand the value customers place on the services you offer will either force you to continue to offer services of little value or prevent you from leveraging valuable services.

If you are sending membership renewals that look like bills - stop!

What Are You Doing This Year to Improve Your Members’ Journey?

It’s 2016 and every customer / member should feel like a rock star. A bad experience winds up written up in a blog like this or even worse trending in Twitter. It has never been more important to think long term about  what your member value is and reimagine your member experience. Is every stop on their journey pleasant and inviting? If not adjust!

Some Suggestions:

1. Map your member journey from prospecting onward.  What are the tough points?  How can they be improved?​
2. Review everything you currently send.  How can we make it more user friendly?  Can you improve the look and feel? This goes for even the most basic things like password reset emails.
3. Empower your staff to think differently. What are we currently doing that we shouldn’t, or even better, what aren’t we doing that we should?  For example, use workflow to automate a task  that keeps a member waiting.  
4. Remove barriers to participation. Are you asking for 10 pieces of information to join?  What if you asked for 5 instead?  How about just name and email to get started?  Think about how you can make it easier and faster to interact with your organization.

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You're Invited

Join Nimble AMS for a Webinar, "The Pursuit of Happy & Engaged Members" on February 17th!