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Wednesday,
August 30, 2023 |
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A Minute with Matt: Thoughts to make you go Hmm......
Member Retention Rate vs. Break Even
Growth vs. Market Penetration Rate:
Which is More Important?
The Member Retention Rate is an important metric. We see and hear Chambers of Commerce touting their retention rates to colleagues and members. Certainly, if you are at or above 90%, you have done well. Since our programs require Chamber membership, we are happy to contribute to your success.
Nevertheless, I want to challenge your thinking. First, do you know how many new members you’ll need this year to maintain your start of year membership with a 90% retention rate? It’s an important number to know, especially as your membership grows. The formula is simple. Since a 90% retention rate also entails a 10% loss rate, take the number of members you had at the beginning of the year and multiply by 10% (or your expected loss).
Example: Anytown Chamber began this year with 330 members. 330 X 10% = 33
With 90% retention, Anytown Chamber must acquire 33 new members this year to maintain 330 members overall, or net 0% membership growth for the year. Bear in mind that as your Chamber membership grows, the more difficult it becomes to achieve net 0% growth. A Chamber with 520 members on January 1 must acquire 52 new members by the end of the year just to break even. That’s one new member per week just to break even.
It’s worth noting that every percentage point above or below 90% is impactful to the overall growth goal. The “stickiness” of SOCA programs can boost your retention rates in impactful ways.
Even so, Chambers of Commerce may be best served to know their market penetration rate within the areas they serve. If your member retention rate is a stellar 95% but you only penetrate 15% of your total market, is that something you really want to tout? Conversely, if your Chamber has a 40% market penetration rate, 90% retention would be a rewarding achievement.
The truth is, you need to know all of these numbers. More importantly, you need to know how they are related. Doing so will help you gain a full understanding of your membership growth performance and help you establish achievable goals.
Hit me back if you have any questions or comments.
Chamber on,
Matt
matt@joinsoca.com |
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Quote of the Week...
"The interesting thing about membership is that it's, by its nature, a very emotional transaction. It feels like voting with your dollars..."
Jack Conte
(American musician & entrepreneur) |
SOCA Tip:
Fall dates are nearly gone... Schedule your New Member Orientation, SOCA Roadshow, or one-on-one with Will, TODAY; will@joinssoca.com.
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Delay on LEGAL Immigration Reform Stymies Small Business Growth
The Mike Zaffaroni, owner and president of the Liberty Landscape Supply, is ready to expand his small business, but the persistent worker shortage is stopping those plans cold.
“The labor shortage has impacted our business more significantly than any other single factor in the entire 16 years that I've been in business,” says Zaffaroni. “It impacts our ability to grow at the rate that we want to grow.” *Read the full story. |
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| NEW Benefit Provider Updates |
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Dear Chamber Partner,
Did you know your members can receive an electric and natural gas bill review for free? That’s right! We let them know what they’re currently paying and what their options are. It’s as simple as sending in a bill. We’ve attached a flyer sharing some recent testimonials from members who have received a free bill review and signed up for the Chamber Energy Program.
Please share the attached PDF flyer with your members this week and don’t forget to add chambernewsletters@ceateam.com to your email list so we receive a copy and know when it has been sent. ??
We encourage you to share our latest posts on social media as well!
Thank you for everything you do! |
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Your Latest HR Update includes... Harassment Training, What to include on a Career Page, At-Will Employment Termination and More!
{ https://conta.cc/3E9FiqS }
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How To Start A Business Using A Free SCORE Mentor
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Starting a small business is always challenging, especially if you lack business experience. At SCORE, we have free expert business mentors who can help you start, grow, and succeed in your dream of small business ownership.
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- Watch the recording of this webinar to help you start, grow and succeed in your dream of small business ownership with SCORE mentor. Watch Now
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