NSA Membership Marketing

1. NSA Membership Marketing Membership Counts and Profiles Recruitment Retention Lifetime Value Value Proposition & Member Benefits Ideas and Tactics

2. NSA Membership 9/30/08 Active Members: 9,453 Associate Members: 747 Retired Members: 501 Student Members: 225 Educator Members: 96 International Members: 31 Life Members: 29 Firm Members: 11 Vendor Members: 6 Total Membership: 11,099

3. NSA Member Profile: Gender: Male Average Age: 57 Education: At least a 4 Year Degree Type of Practice: Sole Proprietorship Credentials: Enrolled Agent Annual Gross Income: $237,019 (in 2006) Annual Net Income: $81,100 (in 2006)

4. NSA Member Profile: • Processes More Than 500 1040s Annually • More Than ½ Gross Income is Derived From Tax Preparation; 20% from write-up work • Has Been in Practice for 23 Years • Has 3 Full-Time and 2 Part-Time Employees

5. Membership Recruitment On average, 1,300 new members join NSA each year Direct Mail Marketing Exhibits Go Getters State Directors Dual ASO Members Word of Mouth (Viral Marketing) Website ACAT & Scholarships

6. Membership RecruitmentFY 07-08 Results Joined NSA between 9/1/07 and 8/31/08: • Active Members: 1056 • Associate Members: 176 • Student Members: 43 • Educator Members: 8 • International Members: 10 • Vendor Members: 5 New Member Total: 1,298

7. FY 07- 08New Members by District • District I: 49 • District 2: 212 • District 3: 73 • District 4: 230 • District 5: 157 • District 6: 57 • District 7: 89 • District 8: 122 • District 9: 95 • District 10: 201 • District 11: 3 • International: 10

8. Membership Retention • To grow, it takes 2 new members to replace 1 dropped member • It costs 3-6x more to recruit a • member than to retain one

9. Factors that Influence Membership Retention Associations that offer individual Membership as opposed to associations with institutional or company memberships typically will see lower renewal rates.

10. Factors that Influence Membership Retention Associations that serve a market where dues are reimbursed or paid for by an employer will see better renewal rates than dues paid out of pocket by individuals.

11. Factors that Influence Membership Retention • Associations with a rapidly growing membership tend to have lower retention rates than groups with a steady or declining membership. • This occurs because growing associations have a larger proportion of first year members and first year members typically renew at a much lower rate than longer term members.

12. Factors that Influence Membership Retention The stronger the incentive used to get members to join an association, the lower the renewal rate will be when compared to members who joined with no incentive.

13. Membership Retention Retention Rates: FY 07-08 • Active Members: 88% • Associate Members: 72% • Retired Members: 98% • Student Members: 59% • Educator Members: 81% • International Members: 69% *First year member renewal rate averages between 55%-60%.

14. Membership Retention ASAE & The Center reports that the mean renewal rate is 83% for an individual membership association and 91% for a trade association.

15. Calculating Membership Retention • # of members who renewed/# of members up for renewal.125 renewed/150 up for renewal = 83% • Total # of members today minus 12 months of new members/total # of members at this time last year.3000 members – 500 new members= 2500/2800 members now = 89%

16. NSA Membership Retention • Multi-part renewal campaign: letters, e-mails, faxes, last issue newsletters/magazine wraps, telemarketing, incentivize early renewals • New member welcomes & renewal campaigns • Different messaging for different member types • Exit surveys • Continually communicate NSA benefits • Engage members • Customer Service & Use of Database • Member Needs Assessment

17. Lifetime Value (LTV) The Lifetime Value (LTV) of a member estimates the member’s financial contributions to the association over the life of membership. It is critical for planning & budgeting marketing expenses. • Average Member Tenure • Average Yearly Membership Dues • Total Nondues Revenue • Cost of Serving Members

18. Lifetime Value (LTV) • Average Member Tenure: 1/Inverse of the Retention Rate 80% Retention Rate: Inverse = 20%1/20@ = 5 Years Average Tenure • Average Yearly Dues x Tenure = Lifetime Dues Value of a Member

19. Lifetime Value (LTV) • Total Nondues Revenue/# of Members = Annual Nondues Revenue per Member • Annual Nondues Revenue per member x Tenure = Lifetime Nondues Value of a Member

20. Lifetime Value (LTV) • Lifetime Dues Value + Lifetime Nondues Value = Gross Lifetime Value per Member • Gross Lifetime Value – Lifetime Cost to Serve a Member = Net Lifetime Value of a Member *Lifetime cost to serve a member = total yearly expenses/# of members x average tenure

21. What is Your Value Proposition? • Who are you to members and who do you want to be? This vital assessment should drive your benefit & services package. • Which benefits & services support the mission, vision & strategic plan of the association? • Understand your members and have a keen awareness of what your are capable of doing and what you should or should not be doing.

22. New Definitions of Value Years ago, belonging to one’s professional association was routine and dues were paid without questioning the benefit. Membership was viewed as a way to support the profession or defend the industry and that was seen as valuable enough to justify a lifetime of membership.

23. New Definitions of Value Consumers have come to develop higher expectations from membership organizations. Today’s members expect a quantifiable return on their investment of dues dollars in addition to the association’s delivering on the mission.

24. New Definitions of Value For every dollar they spend in dues, they demand at least a dollar’s worth of value in return. To respond to this trend, associations must continually demonstrate the value they return to their members and communicate that value consistently.

25. Value Proposition = Unique Selling Proposition The association’s value proposition is composed of all the programs that are given to members when they join. It answers “Why Should I Join Your Association?: From a value standpoint, association programs fit into two categories: • Does the program provide a tangible or intangible benefit to the member? • Is the program related to the mission of the organization or unrelated to the mission?

26. Benefits Sweet Spot Unrelated to Mission Related to Mission Credit Card Program Tangible Discounted Insurance Intangible Networking Knowledge Sharing Discounts on Education Advocacy Help Desks & Libraries Awards Publications

27. Understanding & Articulating the Value Proposition: Turning Features into Benefits • A feature is a product or service the association offers. • When describing the benefits of membership, it’s crucial to put yourself in the shoes of the prospect or member. • The benefit is more powerful than the feature because it defines actual value or outcome for the member

28. Turning Features into Benefits

29. Reasons for Joining NSA Top reasons members join NSA: • Information • Education and CPE • Tie: Credibility, Ethics/membership certificate and publications • Advocacy • Networking Least important reasons for joining: • Annual meeting • Leadership opportunities

30. 75% of members say NSA membership meets to strongly meets expectations

31. Member Benefits: NSA Member Survey Results Top 6 challenges facing members: • Keeping up with tax law • Marketing/business development • Employee issues: hiring & retaining staff, etc. • Technology • Time management • Competition

32. Member Benefits: NSA Member Survey Results Other top challenges: • Customer service and relations: timeliness of service, getting info. from clients, keeping clients honest • Education • Expenses • Cash flow • Information overload • Pricing of services

33. Membership Marketing Tactics • Use Active Voice • Use Benefits Over Features • Use the word YOU • Keep it Simple and Direct • Use Call Outs, Bullets, Charts, Bold, Italics, Testimonials, Boxes, Color, etc. • Use Personalization if Possible

34. Membership Marketing Tactics • Letter Packages Outperform Self-Mailers • Letters: Use Johnson Box, PS and PPS; Put the Appeal and Offer Upfront • Letters: Longer Letters Out Pull Shorter Letters; should have more emotional appeal than brochures • Envelopes: Plain or Teaser, Return Address, Live Stamp, Label, Handwritten Font, Color…Plain White & Boring Works

35. Membership Marketing Tactics • Speak to your audience’s pain points first and then offer a solution. But only in bite size chunks. • Don’t give away all of your information. Create a desire to learn more and make it easy for them to find out more. • Use every response technique you can - email, toll free telephone, fax, business reply card…repeat and make it easy to find.

36. Membership Marketing TacticsWriting the Offer • Link Benefits to Two Primary Motivators: Greed and Fear: · What’s in it for me? · What happens if I don’t respond? • Offers with Deadlines Outperform Offers Without Them (90 Days)

37. Membership Marketing Tactics • Offer Incentives & Discounts: Should be 15-35% • Price Points: #s Ending in a 7 or 9 Get Higher Response Rates • Use Real Examples, Numbers Product Data, Testimonials • Repeat & Repeat the Offer & Take Action Response Mechanisms—Make them Easy to Find

38. Membership Marketing TacticsNew Members • Break Down the Welcome Membership Kit/Materials Into Smaller Pieces to Increase Communication & Encourage Engagement • Welcome Call • Six Month Check In, Thank You, “How Are We Doing?” Survey • Communicate BEFORE the Renewal Cycle Begins