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It is Not a Membership Problem. It's a Math Problem. - Matt Appenzeller, Executive Director, Southern Ohio Chamber Alliance
Jun 07, 2021
As of January 1 of this year, the Anytown Chamber of Commerce had 400 members. The Chamber has two employees, a full-time director and a part time staff member. The Board has set a goal of gaining 48 new members this year, an average of four per month. Assuming a 88% member retention rate (the median national average for a Chamber its size), how many members will Anytown Chamber have at the end of this year if they meet their membership goal?
Answer:
(400 starting members x .88 members retained) + 48 new members = 400 ending members
The Anytown Chamber is currently in a strategic planning session. A few enthusiastic Board members assert that “there’s no reason that Anytown Chamber can’t double its membership from 400 to 800 members over the next five years”. This, they argue, should be easy to do if they simply set goals to gain two new members per week (104 per year) for the next five years while achieving a 93% retention rate (5% above the median national average). They congratulate themselves for a great planning session and go back to their regular jobs. Does their math add up? Will they actually double their membership in five years?
Answer:
Year 1
(400 starting members x .93 members retained) + 104 new members = 476 ending members
Year 2
(476 starting members x .93 members retained) + 104 new members = 547 ending members
Year 3
(547 starting members x .93 members retained) + 104 new members = 613 ending members
Year 4
(613 starting members x .93 members retained) + 104 new members = 674 ending members
Year 5
(674 starting members x .93 members retained) + 104 new members = 731 ending members
for five years
- What is the proper ratio of dues vs. non-dues revenue each year for our Chamber? What new revenue opportunities should we be looking for?
- What percentage of labor hours are spent on activities that result in little or no growth? What kind of impact does this have on employee satisfaction and burnout?
- How does this math impact the income statement year over year?
- Do we need to change our dues structure? Should we raise dues or perhaps even lower them to gain a wider audience?
- How can the Chamber grow over the next five years?
- Have we really done the math for our membership goals or did we set it arbitrarily?
- Are Chambers of Commerce better off having a comprehensive, regional membership drive every two or three years in conjunction with a capital campaign every five years? Would a new approach to membership growth free up the time of employed staff to pursue well-researched non-dues revenue opportunities?
U.S. Chamber's Institute for Organizational Management Scholarship OPEN for CCEO Members! Winter Session- January 4-8, 2023 in Tucson, AZ.
Top 10 Membership Retention Actions to Take!
Fellowship Provides State and Local Business Leaders with Opportunities to Engage Nationally on Critical Education and Workforce Issues
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