Cathi Hight
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
1
Design an Effective
Retention Plan
A retention plan is so much
more than a collection plan
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
2
Objectives
 Recognize the importance of a retention plan
 Explore the components of an effective
retention plan
 Understand how The Member Retention Kit
can help you develop a retention plan
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
3
Why Have a Retention Plan?
 Most chambers lose 20 – 60% of their members each




year
Lost members = lost dues & non-dues revenue
Chambers have to depend on lots of new members
to take the places of those lost
Too many ‘drops’ hurt chambers’ image, credibility
and their recruitment efforts
A retention plan helps chambers to enhance
communication, increase engagement and the ROI of
membership
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
4
The Member Retention Kit
 Section I: A Guide to Member Retention
 Section II: Situational Analysis—Understand
Where We Are
 Section III: Feedback—Understand Member
Needs and Expectations (22 samples)
 Section IV: Alignment—Improve Retention
 Section V: Tracking—Measure and Manage
Outcomes
 Section VI: Retention Tools
 Section VII: Hight Performance Group Info
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
5
Overview of Member Retention Kit
 Section I: A Guide to Member Retention
 Retention Scorecard
 Common challenges around retention
 Reasons why members leave and renew
 Lifetime Value of Members
 Difference between satisfaction and loyalty
 New concepts to adopt:


Member Relationship Management (MRM)
5 stages of the Member Experience Cycle and
Member Experience Management (MEM)
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
6
Section II: Situational Analysis: Start with
Where You Are


Describe current member base, overall retention rate, and analyze various member groups
 Segments may include: industry sector, size, revenue, zip code
 Consider: first year, second year, 3-5 year, 5 year + members
Define member base make-up
 Industry, size of business, length of time in business, town/city, etc.
 Compared to the business landscape



Calculate overall retention rate
 Based on NAMD formula




Total no. of member accounts / total no. of businesses in the service area. Ex: 2,000 / 20,000 = 10%
Market share by industry—No. of member accounts per industry / total number of businesses in industry. Ex: 50 /
200 = 25%
Total no. of member accounts for last year – total no. of cancelled accounts for current year /
total no. of member accounts for last year – overall retention rate
Example: 2,000 – 400 / 2,000 = 80%
Determine member segment retention rates & identify trends
 What is the retention rate of each member group?
 Which member groups are you retaining the best?
 Which members are-at-risk and how do you know?
Select member segment(s) to focus on for retention initiatives
 Which groups present retention challenges?
 Which member groups do you want to see an increase in retention?
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
7
Member Companies by Primary Category
1%
2%
3%
2%
Business Services & Supplies
13%
3%
Building, Construction, Remodeling, Landscaping
3%
Financial Services
Retail
3%
Food, Restaurants
11%
4%
High Tech, Computers, Telecommunications
Real Estate
Medical, Health & Wellness
4%
Banks, Credit Unions, Lenders
Personal Services
4%
8%
Transportation, Travel
Manufacturing, R&D
Art, Entertainment, Sports, Events
5%
Nonprofit, Government, Utilities
7%
6%
Education, Training
Lodging, Hotels, Motels, B&Bs,
Legal Services
7%
7%
7%
Designing an Effective Retention Plan
Miscellaneous
Publishing, Newspapers
© 2007 Hight Performance Group, Inc.
8
Member Companies by Size
4%
1%
4%
1
5%
20%
2-5
2%
6-10
2%
11-15
2%
16-20
21-25
3%
26-30
4%
31-39
40-49
6%
50-99
33%
100-499
500+
14%
Designing an Effective Retention Plan
unknown
© 2007 Hight Performance Group, Inc.
9
Members with the Best Retention Rates
Retention Rates
100%
% Retained @ 1 Yr ...
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1
2 to 4
5 to 10
11 to 25
26-50
51-100
100+
Number of Employees
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
10
Overview of Member Retention Kit
 Section III: Feedback—Understand Member Needs
and Expectations



Benefits of collecting feedback from members
Brief overview of ways to collect feedback
Create a Retention Task Force (volunteers) to conduct
a retention study






Design the feedback instrument
Launch the feedback process
Review the results
Collect insights and possible strategies
Analyze the data
Create a retention study report to share with others
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
11
Design the Feedback Tool
 Determine what you want to know
 Identify areas to collect feedback (MRK, Sect III)
 Perception about the organization’s image and brand
 Member values and reasons
 Reasons for joining and rejoining
 Overall experience with the organization
 Usage of benefits
 Experiences with benefits
 How well expectations are being met
 Other benefits needed or of interest to members
 Loyalty to the organization
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
12
Challenge Areas: Communication,
Engagement and Value
 Retention challenges fall into three areas:
 Communication
 No two-way communication with members
 Lack of awareness of what is offered, how to access
benefits, and your goals and accomplishments
 Type of venue not used or are not user-friendly
 Engagement
 Members do not participate or are uninvolved
 Venues are not user-friendly or productive
 Value
 No ROI visible or ROI does not equal expectations
 Does not see value for investment
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
13
Create a Retention Study Report
 Retention Study Report content:






Overview of retention baselines
Cite retention challenges
State the purpose of the retention study
Provide overview of the process
Recap the results of the feedback process
Define challenge areas and possible
recommendations to address them
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
14
Overview of Member Retention Kit
 Section IV: Alignment—Improve Retention

Retention Goals: What Do We Want to
Accomplish?

Planning Assumptions: What Will Affect the Plan’s
Success?

Retention Strategies and Tactics: How Do We
Implement the Plan?


Retention Tactics Timeline
Retention Budget
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
15
Section IV: Alignment—Retention Goals and
Strategies
 Which member group do you want to focus your
retention efforts on?
 What specific results are you hoping to achieve?
 Sample retention goals:




Increase retention with 1st year members from 50% 65%.
Participate in two-way communication with members
three times/year.
Increase the overall transactional value of members by
10% through higher levels of engagement.
Create a profile of ‘ideal members’ and target that 25%
of all new members recruited align with those profiles.
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
16
Retention Strategies: Communication,
Engagement and Value
 Consider strategies that address these areas:

Communication




Engagement



Two-way communication with members
Awareness of what is offered, how to access benefits, and
sharing your goals and accomplishments
Ensure that venues are user-friendly and utilized
Identify ways for members to participate and be involved
Monitor engagement levels and identify members-at-risk
Value



Communicate the ROI of membership
Determine ways to meet or exceed member expectations
Realign programs and benefits to meet evolving needs
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
17
Retention Tactics Timelines: What is Our
Implementation Plan?
 Every strategy creates tactics
 Tactics need resources (e.g., time, people or money)
 Use the Retention Activity Flowchart in Section IV to
determine how often and when tactics will be
implemented
 Identify responsibilities and who is accountable for
implementing specific tactics
 Verify resource availability


Talk with others who need to be involved
Gain their commitment to support implementation
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
18
Overview of Member Retention Kit
 Section V: Tracking—Measure and Manage
Outcomes



Identify what to measure
Determine frequency of monitoring outcomes
Consider contingency plans
Designing an Effective Retention Plan
© 2007 Hight Performance Group, Inc.
19
Develop an Effective Retention Plan




Designing an Effective Retention Plan
Based on retention trends, and specific
retention goals and strategies.
Use the Member Retention Kit as your
guide
 Explore sample retention tools
provided by other chamber peers
 Receive one hour of consulting from
Cathi, wherever you need it
Save $75 on the Kit if purchased by
12/5/07!
For more info, contact Cathi at (720)
304-0747 by e-mail:
[email protected]
© 2007 Hight Performance Group, Inc.
20