How to build an effective membership program

Casual customers are one thing, but guaranteeing repeat business from customers who like and use your product offering will secure ongoing loyalty and regular predictable revenue. Ongoing members can create security and profit for many small businesses and start-ups, giving confidence that a base level of income will flow on month-to-month.

A great membership is all about offering something regular and valuable to your customers. It also doesn’t have to be a paid membership if building a database of regular engaged customers to on-sell to is more important for your business than the immediate revenue it can generate.

How do you captivate some of your customers to be ongoing members? Here’s what to consider if you’re thinking about creating a membership program.

Know your members before you start

It is important to really get to know the needs of your loyal customers so you can find other customers like them. Before you build your membership program a great way to do this is to speak directly with some of your regular customers. You want to understand what it is they love about your organisation and what keeps them coming back. What do they want more of? What other memberships do they have? What other memberships have they walked away from and why? What would make them feel like a valued customer of your business? Get inside the heads of your customers so you can design the program for them from the outset.

Listen to the outcomes of this process and prioritise the services that are highest value to the members, and at the same time are the highest return for your business. Start with both of these in mind.

How will your model benefit members (and you)?

If you’re not clear on the benefits of membership, then how will you sell the idea to customers? You must provide either a real or emotional value. If you’re focusing on real value, it’s all about cost, convenience and rewards. If your focus is emotional value, the offering is relating to identity, community and experience.

Members need to be given perks and advantages that the general population don’t have access to. You also need to assess what each benefit will cost you in actual costs and staff time so you can make sure your membership program is going to make you money. Work out what percentage of your customer base you expect will become members and multiply this by the per member price – make sure the resultant figure is not exceeding the program outlay costs.

Don’t forget that there are many ways to include benefits that don’t cost you a fortune (or anything at all!), including aligning with other local businesses who want to offer freebies and discounts. Other ideas for benefits may include: access to VIP events, birthday gifts, special one-on-one sessions with your team, merchandise and reward points.

Ensure your membership program is a brand extension

Your membership program, including its name and associated marketing materials, needs to match the look and vibe of your brand. You must decide if having different levels in your membership program suits the nature of your brand. One membership offering can be a simple and inclusive way to go, whereas having levels provides different price points for entry and allows you to create a tiered approach with a further sense of exclusivity (I recommend max three levels).

Don’t set and forget

It’s important to keep capturing information about your members when they sign-up so you can ensure what you’re offering still appeals to the demographic of current members. You also need to look at what benefits and offers are really taking off and which ones are rarely used and adjust the program accordingly.