One of the most interesting realities of the private club industry is that we spend far more time and energy in matriculating new members than we do keeping the ones that we have. From my perspective, we need to spend equal time and energy on membership retention as we do with membership recruitment. Obviously, there are non-controllable reasons that members leave including health issues, death, moving away and financial hardship, but they tend to be minimal. It’s the non-controllable reasons that could be the low hanging fruit.
Start with the basics. Is your club tracking resignations? Is there a call from someone of authority to members who resign? Often, with an empathetic call, a member’s resignations can be reversed. As importantly, information can be shared that may shed light on areas that need improvement internally.
So many clubs fixate on new sales to replace resigning members, losing focus of the other side of the equation, keeping the members that you have. As most everyone in the industry is aware, attrition rates average around six to eight percent for golf and country clubs and can range as high as twelve to fourteen percent in city and yacht clubs.
If you are focusing on retention the question that should be addressed is why members leave if they aren’t facing the non-controllable reasons as stated above. Often resignees indicate they are not using the Club enough. Admittedly, this is also the “catch-all” excuse for any number of reasons, but we have to assume that some percentage of those leaving because they don’t use the club could have been saved. What would happen to overall membership growth if you could simply cut back attrition to 4 percent? What would those overall membership increases due to cash flow, value, and usage?
Depending upon the entry fees, decision points can come very early in membership tenure. Some studies have indicated that as many as 25% of new members will leave in the first year if they have not been ingratiated into the lifestyle. This is more prevalent in low to no initiation fee clubs, however, for clubs with payment plans on higher entry fees, they may be equally susceptible to early attrition.
Incoming and existing members tend to have the same decision points:
- Will we or are we using the club enough to justify the costs?
- Do the activities and events provide equal significance or relevance to every member of the family?
- Assuming we can justify the cost, with our time commitments, is the activity schedule such that the entire family would the club frequently enough?
Clubs considering these member/non-member concerns sometimes conclude that the answer is in lowering the price to create the value. As a last resort this may be true, but it is also very likely the beginning of the end. In most cases these clubs have not provided the kind of programming that is relevant and attractive to the entire family, thus reducing the value proposition. Value is not necessarily a price issue. Everyone will spend more on something that has greater significance, or provides something unique not available elsewhere. I like to call this “lifestyle significance”.
Think about membership retention in another way. How many members leave the club with their golf handicap going down? How many members leave voluntarily that are engaged in the social fiber of the club? The leagues and ladies groups? The families whose kids adore the activities provided especially for them? Reality check? Not many!
So what are the keys to enhancing the membership retention process and building relationships that create community? It starts with a common vision and a clear understanding of the culture you’re your club serves. In the absence of an overall activity director who directs planning in each department, the departments themselves must align to be relevant to women, families, children, golfers and non-golfers. In addition, care must be taken to plan activities, and strategically communicate. Programming today must touch several generations, time commitments, gender, and family. This is doubly important in the first days of a new member’s tenure. There must be a top down directive to understand how best to position every department in creating greater relevance and significance to the member’s lives.
Here’s a few tips to consider when looking at the membership retention and relationship processes:
- Develop a top down educational process to facilitate uniform and consistent understanding of cultural differentiation and how to reposition the club’s activities to create greater significance to each.
- Create departmental accountability in creating activity schedules, events and cross departmental programs addressing cultural differentiation.
- Remember the women, the family, the golfs and the non-golfers. Remember the under 45’s as clearly as you respect the needs of your more mature members.
- Initiate personal communication processes for the first 180 days of a new member’s tenure. Get them to participate. Introduce them to other members with like backgrounds and interests. Remember that this is not the responsibility of the membership director alone. This crosses into every department in the club. Engage, engage, and engage. Most of all have a process that holds every department accountable for their part of the engagement.
- Track usage so that if new or existing members are not using the club frequently they get a call from one or more of the department heads.
- Membership growth, membership retention increasing usage and enhancing satisfaction is the overall goal. The responsibility is on every department within the Club.
Perhaps the most important by-product of creating greater relevance, attractiveness and significance is that the brand, the value, the usage and the satisfaction levels will increase giving way to greater demand, greater market share and reduced attrition and a value that is immune to the necessity of price cutting.