Mastering Membership Pricing: Strategies to Maximize Value and Advance Your Mission
How to Get Membership Pricing Right
Have you ever wondered how to nail membership pricing? Think about “The Price is Right” game show. It’s been on for half a century because it resonates with us. Prices matter, but they can be tricky to pin down. Getting them right can lead to big rewards.
Likewise, association pricing often feels like a guessing game. How do you even determine the prices of your offerings? Some things might have always been priced a certain way, and you might need to know why or who decided. If you’re like most, you rely on your best judgment without further thought.
But here’s the thing: nailing your pricing strategy comes with a prize. And it’s not just about money. At Sequence Consulting, we say that associations have a “Triple Bottom Line” to consider: Money, Member Value, and Mission.
Let’s delve into each of these aspects:
1. Money: Researching Membership Pricing
The value of your offerings is determined by how much money they generate. This means subtracting your costs from the price. So, start by asking yourself: are we charging enough for our memberships? Is there room to increase prices? Take a look at your competitors and similar organizations. What are they charging? Also, consider surveying your members to determine how much they will pay. You might be surprised to discover that they are willing to pay more than you think.
Now, let’s talk about your expenses. Do you know how much it costs to produce your offerings? You may not have a clear idea if you’re like many associations. You might see the cost of organizing an event, but what about the actual cost of training, content, or even membership? It can be challenging to figure out, but it’s crucial that you do. When organizations conduct an honest cost analysis, they often realize they’re losing money on things they still need to consider.
2. Member Value: Measuring Member Value
Money is only one of our priorities as a non-profit. We value our members above all else. Our goal is to enhance the value of membership through our programs and offerings. Determining member value isn’t subjective; it can be measured. One effective method is by analyzing membership renewals.
Renewing members are likely to be more engaged with specific offerings than others. Additionally, some offerings may have no impact on the decision to renew. By closely examining the correlation between renewal and member engagement, we can gain valuable insights into what our members find helpful.
This understanding will help us enhance our membership pricing and ensure that our programs and offerings align with our members’ values.
3. MISSION: Aligning Membership And Mission
When it comes to membership pricing, it’s essential to consider what you offer in relation to your mission. Some things you provide may not directly benefit your members but rather serve the overall purpose of your organization. Take, for instance, your content. If raising public awareness aligns with your mission, you offer most of your content for free. Evaluating the impact of your mission objectively is also crucial. You can assess alignment with your strategy, the ability to bring about change, and other relevant factors. Certain aspects are mission-critical, and assigning them appropriate value is vital.
The ultimate goal for your association’s pricing strategy is to maximize at least one of the three bottom lines. It’s acceptable if a product or service doesn’t generate profit if you intentionally provide it at a loss. Consider a database that offers immense value to your members, even if they couldn’t afford it otherwise. However, it’s unacceptable to incur unintentional losses or on offerings that don’t directly benefit your members or advance your mission. When it comes to membership pricing, striking a balance is key.
The Membership Price Is right
In conclusion, finding the perfect membership pricing strategy is crucial for associations looking to maximize their value. Like “The Price is Right” game show has captivated audiences for decades, getting your prices right can lead to significant rewards. Associations must consider their triple bottom line: money, member value, and mission. By carefully crafting pricing strategies that align with these factors, associations can attract and retain members while fulfilling their mission. So, don’t underestimate the power of pricing and take the time to unleash these three powerful strategies to unlock the full potential of your association’s value.
To learn more about membership pricing strategy see Increasing Membership Dues: Strategies to Drive Revenue Growth for Your Association.
Chris Vaughan is the Chief Strategy Officer at Sequence Consulting, with over 20 years of experience helping associations grow. Specializing in membership and revenue strategies, Chris partners with organizations to deliver transformational growth and enduring change.
