Calendar
This is our quarterly investigation into the status of the membership, where we reveal patterns, trends and highlights as well as what's moving.
The beginning of 2022 has been a continuation of clear patterns in the membership market that were evident in the last quarter of 2021. In a digital landscape that's growing rapidly, membership has proven to provide a reliable and stable source of revenue as we've seen the membership business model flex its stability over the past few weeks.
Highlights
Continued member growth
The fourth quarter of 2021 noticed a substantial increase in the number of new members joining. This pattern continued and picked up speed to Q1 2022 as consumers were coming off holidays and returning to work, school as well as other regular routines. In a period of the season when attention from consumers is generally difficult to get there was a notable increase for new member acquisition across the major membership categories, especially during January as well as February.
Resilience during headwinds
In the month of March, we saw large amounts of uncertainty being injected into the overall economic environment that had a noticeable impact on consumer behaviour. Inflation and the conflict in Ukraine were the two main reasons that caused consumers to become more cautious. These developments have moderated those areas of growth that we noted in January in February.
While these macro developments have certainly impacted the membership landscape, we've seen the effectiveness of the business model truly shine when these headwinds are forming.
In the present, the bulk of the impact we've seen was focused on new member acquisition. The retention of members has been steady, highlighting the resilience of membership along with its significance within a wider strategic plan of business.
It also reinforces the importance of structuring benefits for members to ensure that the benefit engages members regularly. The memberships that can incorporate benefits into members' daily or weekly routine consistently experience lower loss of members and more retention in times that are more uncertain, thereby making it possible to sustain income as well as growth for members.
What's happening?
A new scene
The landscape for membership is constantly changing. The digital landscape changes even quicker. While our clients explore new ways to grow, the importance of diversifying their member acquisition strategies is never more apparent. Ad costs are rising. Social media engagement has reached the point of no return. People are less open to traditional marketing and acquisition tactics.
What is the reason? In the last two years, we all have spent more time on the internet than we had ever imagined. It was an excellent time to discover content and join generally. But, the extended internet experience has caused noticeable ad fatigue among users (your prospective customers).
Audiences have been so exposed to badly targeted advertisements for so long that they hardly even notice them now - much less, take steps to remove them. Is advertising dead? No. But given the landscape, the economics and costs are no longer favorable to the advertiser.
Member-driven growth
We are seeing the next stage of membership growth heavily influenced by current members. True messages, trusted opinion and personal experiences build immediate confidence that motivates action.
Our recent introduction of Referrals is the first move towards developing evergreen solutions that allow for leveraging the satisfaction and loyalty of your member base to generate additional sales.
Referral strategies of customers are not only seeing less cost to join but an increase in retention of members. This increase in retention is due to referring members being offered discounts for membership once they succeed in referring.
Members who receive recurring rewards for referring others are significantly less likely to be churned and are always inspired to refer more customers. Incentivizing your members through referral rewards allows them go out and start the right conversations with the right people - leading to greater sales with lower expenses.
The Takeaway
The shifting landscape that we've witnessed during Q1 is a clear illustration of the necessity of continuous building solid foundations within your membership. These foundations become the safest place to be during periods of uncertainty and allow members to do your best work - run your membership with confidence.
While the landscape of membership is constantly evolving and growing, there will always be an ongoing factor that can be leveraged to increase your membership, and that's the foundation of your current members. Your continued commitment to providing them with the best service will build a level of trust that will eventually lead to them becoming your greatest supporters.
Do not lose sight of the seemingly small foundations inside your group. These tiny foundations that can bring your the greatest rewards.