Best practices for membership model pricing

Setting the right price for your organization’s membership packages can sometimes feel so complex that you might be tempted to skim over the idea of pricing altogether. But membership pricing is vitally important, and it warrants thorough consideration.

Just think: If you overprice your membership levels, you run the risk of turning off members. If you underprice them, they might seem less valuable than they really are (and might even leave money on the table!).

So, let’s look at some key concepts, best practices, and tips to help you make sure the price is right for your organization’s membership models.

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Considerations for creating or changing your membership models

In the 2021 Association Trends Study by Community Brands, two of the top three reasons lapsed members gave for failing to renew their membership with their organization were that it became too costly and that the organization provided too little value. This underscores the importance of striking the right balance between price and member value.

Getting member feedback

Before you create new membership models or make changes to existing membership packages, be sure to gather feedback from your members. Here are some helpful questions to ask:

• Do the new or existing membership packages provide enough value? Why or why not?
• Which benefits do you find most useful? Least useful?
• What one thing could our organization add to the member experience that would make it more valuable to you? Why?

Considering new membership models

Armed with member feedback, here are some examples of membership models to consider using:

• All-access pass – An all-access membership option is the “Cadillac” of membership models, giving members access to all content, webinars, on-demand courses, and resources at a premium price.
• Freemium – This model brings together “free” and “premium” memberships. It offers a “free” tier that gives members limited access to certain benefits as a trade-off for not paying. With the premium tier, members have access to more benefits and value for their paid membership. This model gives your members the opportunity to test drive the value of your organization and eventually invest in the premium membership.`
• Free trial – Consider offering a free trial option that offers a free month of membership, allowing members to try before they buy.
• A la carte – Offer a membership that allows members to choose only the services they want.
• Bundling – If your organization offers a wide variety of services, resources, and events, bundling might be the perfect approach. With this model, specific benefits and services are grouped together with organizational membership.

Determining your membership 
pricing goals

Defining what you’re trying to achieve with each membership package or level will put you on the right path to deciding on the ideal price.

Here are two major goals to consider as you set pricing for each of your membership levels:

Driving revenue (profitability) – The goal here is to get the highest price possible so that you can use the profits for new/improved programs or other activities that help you achieve your mission. The secret to reaching this goal is to provide enough value to justify the price while capturing as much margin as possible.

Reaching more people (affordability) – When this is your goal, it’s important to make the price as affordable as possible so that more people sign up. The trick here is to not price it so low that it’s perceived as a low-quality offering.

These goals represent two ends of a spectrum. Within this spectrum, here are some other things to consider as you determine your goals for each membership package:

• Are you trying to get more new members to join? 
Or get more members to renew?
• Are you trying to gain more new members from a specific group, such as students and new graduates?
• Are you trying to get current members to move to a higher membership level?
• How are you trying to position your overall membership program within your industry? As a bargain? As a high value offering?
• Keep in mind that your goals and your approach to pricing will likely vary for each of your membership packages/levels.

Chatbots can scale your operations by performing a wide array of tasks. Since chatbots are computer programs, you can code them to meet your unique requirements. The availability of large amounts of interconnected data coupled with the improved algorithms and computational power of machines has made picking out patterns and making connections easier. Tasks that were once under the sole domain of humans can now be performed in a fraction of the time by AI-based chatbots.

Tapping into the potential of chatbots can open a door to vast opportunities for membership associations of all types. Here are some of the most common ways different organizations use chatbots:

However, you can’t simply decide to employ chatbots in your organization one fine morning and do it that very afternoon. Every organization needs to take a few steps before actually employing a chatbot live.

The very first thing is to put together the appropriate internal team to discuss the problem they want to address with chatbots. This team may include staff from several relevant departments, such as IT, finance, member services and marketing. This team decides the functionality of the chatbot and where it should go live online.

Gathering the relevant data by using AI and ML is the second step. Depending upon your requirements, developing or modifying an algorithm to integrate with the data can lead to different functionalities, which makes each chatbot unique.

The final step is to test and train this chatbot before going live online. For every AI-driven technology, training is an essential part of development. Training the algorithm helps shape it and gives it the history it needs to be capable of carrying out the tasks you want it to.

Focus on Personalization

The art and science of marketing used to be about pushing a message outward, but modern audiences aren’t receptive to that kind of messaging anymore.

Modern marketing is less about directly promoting your product or service and more about building authentic, genuine relationships with your audience by providing them real value. It means understanding their core wants and needs. It means frequenting the same online spaces your audience does and interacting with them over mutual interests. An AMS can help you build those relationships.

Here are a few of the ways to personalize your marketing messages.

Provide Member Recap of Activities

It’s impossible for most people to remember every interaction a contact, member or prospect has had with your association.

Any interaction you have your audience needs to start with questions such as:

Most modern CRM or AMS software includes this information. Use it to your advantage to build trust with your audience.

Reinforce Engagement

Customers and members have come to expect personalization. They want to feel like more than another transaction to your association. If they need to reach out, they want to know that the person on the other end of that support call, email or chat message is a human being and not an automated program tricking them into thinking they’re human.

To provide the personalization your members expect, you must be in the know. Nearly 80% of consumers report they are likely to interact with an offer only if a brand has personalized it based on prior interactions.

Use email marketing tools to verify and use the contact’s first name, and customize your content based on your contact’s needs and specifications. You can also segment your content based on personas, such as by their industry and job title.

This encourages engagement and compels them to stay on your website for longer.

Create Personalized Offers

Your members want to know that you’re catering to their needs specifically and that they’re not just a number on a spreadsheet to you. People are more likely to do business with a company or engage with a membership association if it offers personalized experiences.

Personalization starts with listening to your members. Send out periodic surveys, read what your members say in your mutual online communities, and consider hosting online focus groups to collect the information you need to personalize your offerings.

Use Their Preferred Method of Communication

Do your members prefer to talk over text or email? Do they use social media, like Facebook messenger?

The modern internet gives people hundreds of ways to interact with brands, and they probably have a preference. Include surveys in your newsletters and social media posts to find out which communication methods your members prefer. Make the most popular options part of your member experience, and let your members choose how they want to communicate with your association.

Identifying Cross-Selling Opportunities

It’s hard to think of another tech giant that has mastered the art and science of e-commerce more than Amazon. One of the secrets to their success is cross-selling. Amazon CEO Jeff Bezos revealed that 35% of sales were a direct result of cross-sales.

When you see the “Customers who bought this also bought…” feature on Amazon, this is what he’s referring to. A relationship with a customer doesn’t just end with a single person. Cross-selling is a clever way of getting them to continue to engage with you by offering them related products in other categories they’re likely to want or need based on their previous purchase history.

Here are two ways you can replicate Amazon’s success:

You can use your AMS data to recommend products to your members and increase cross-selling. Determine what kinds of products or services your members usually gravitate toward, then consider what else you can offer them. An AMS can help you identify trends in the products and services your members buy. If most people who bought Product A also bought Product B, you can suggest Product B to members interested in Product A. You might also consider offering both products together as a bundle.

Benefit From AMS Automation

Even if contact or prospect joins your association once, they may not necessarily remain a member indefinitely. To run a sustainable association, you need to get them to keep coming back. This is what’s known as retention. Here are a few ways you can leverage AMS automation to increase membership retention.

Email Marketing for Associations

IUse your AMS AI software to segment your member list, and try to understand what they want from you and what they’re interested in. Look for metrics and data such as:

You can separate them further into new members, long-term members and inactive or unresponsive members. You can also use emails to remind members of automatic membership renewals, helping avoid lapsed memberships.

Gamification

You can use many of the same principles used in modern game design to make your automation more engaging. It uses the simple principle that people are more likely to do things they enjoy or think are fun.

Use the content that you serve them to tell a story: one where they are the hero of that story, and you are their humble guide. It’s a hero’s journey narrative widely seen in most forms of popular media, including games.

You can also reward your most engaged members with exclusive content or offer challenges or contests into your automation. Think about how you could automate a system that rewards members who engage with you the most.

Automating Workflow Processes

Your AMS can help you automate many workflow processes to help you track membership. You can schedule reports and automatically send them to yourself, managers and executive leadership. If becoming a member of your association requires an application, automating that process makes it easier for potential members and your staff and ensures every part of the application is complete.

Frequently Asked Questions (FAQs)

Here are some of the most frequently asked questions about AI and AMS systems that might affect your association.

Does GDPR Impact AI Decision Making?

In some ways, General Data Protection Regulation (GDPR) makes using AI to gather consumer data more complicated for organizations in the European Union (EU) or that have members in the EU. However, this regulation also helps create the trust that good member relationships are founded on in the first place and helps governments and consumers accept AI technology more.

Are There Privacy Issues With Tracking Data in My AMS?

When your members share their private information with you, they trust that you’ll use it to provide them with a better experience.

In a survey, 71% of association members stated that tech made them concerned about their data security and privacy. However, 56% claimed that they were comfortable with companies collecting data on them if it was for their benefit.

If you’re an AMS manager, it’s your responsibility to strike a balance between providing the best member experience possible and adhering to ethical data privacy standards. These include:

How Can You Remain Accessible With Your AMS?

Web accessibility is the practice of making your website or app accessible for people with disabilities, including individuals who are blind, visually impaired, deaf, hard of hearing or colorblind.

Being accessible with your membership management software for associations is just good business. More accessibility broadens your potential audience and draws in more potential members.

Some things you can do to be accessible with your AMS include: