The Difficult Conversation that You Need to Have with your Chamber Board

Many suburban and rural Chambers of Commerce operate on tight budgets with no more than two paid staff. If that’s the case for you, then spending a lot of time chasing new members isn’t necessarily the answer. You may very well end up churning through members and burning yourself out at the same time.

At the CCEO Winter Conference last week, I asked a room full of Chamber Execs how many of them operated with only one or two paid staff. The overwhelming majority raised their hands. Then I asked how many of them have between 200 and 300 members in their Chambers. Approximately half the room raised their hands again.
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Then we dove a little deeper into the membership trap. I asked the audience to make three assumptions:

1. Your Chamber currently has 250 members.
2. You have promised your Board Chair that- without fail- you have a plan that is guaranteed to land your Chamber one new member every two weeks for the next ten years.
3. You have also promised your Board Chair that- without fail- your membership retention rate will be 90% for each year for the next ten years. This means you guarantee that your Chamber will exceed the industry average of 87% member retention by three percentage points (Association of Chamber of Commerce Executives, Trends in Chamber Membership Statistics for Fiscal Year 2017, p.6).

On the surface, these sound like lofty promises, and they may even sound too good to be true. But here’s the problem: even if they are true, your net results are a gain of only one new member in the first year. Here’s the math:

• One new member every two weeks = 26 new members in the first year
• 90% retention of 250 members = loss of 25 members
• 26 new members minus 25 members = 1 net new member in the first year

Part of the value of attending the CCEO Winter Conference is being challenged to think differently about your Chamber operation. It was clear that a lot of Chamber execs in the room were surprised by the math.  

As you can see, depending on whether we round a decimal point up or down over the course of time, it will take you at least ten years to go from 250 members to 260 members. During that ten year span, you will have churned through at least 25 members per year. In other words, you will have churned through 250 members during that time to increase your membership rolls from 250 to 260 members, only to find that by using the same math, your net gain is ZERO members in the eleventh year!

Reality can be depressing sometimes. What’s even more depressing is that it doesn’t get any easier if your Chamber is more than 260 members. For example, Chambers with 500 members need to gain one new member per week combined with 90% member retention just to reap net growth of just two members for an entire year’s work!

Of course, ultimately you are a membership organization and membership is important. All I am saying is that you need to be aware that membership can have a limited impact on your budget. You need to evaluate whether or not you have the right revenue models and dues structure. You also need to be open to a variety of non-dues revenue opportunities, even if they do not originate in your community.

More importantly, your Board of Directors needs to be aware of this math, and they need to commit to doing all that is necessary so that Chamber Executives can lead successfully.