Effects of Increasing Membership Prices

You're right on as to the issues you need to consider, but if you do it right, you should be fine.  Some areas to consider:

- How will the proposed membership pricing fit with your admission pricing? Eg if you will be raising admission prices, it's fair to raise membership in the same proportion.  Make sure all frontline staff have clear messaging about membership (e.g. at the Science Museum, a family of four only has to visit twice in one year for the membership to pay for itself).  Your math doesn't have to be the same as ours, but if you can justify the membership increase because it keeps that "benefit math" the same, you usually won't meet with too much resistance.

- How much of a price jump are you looking at?  We haven't raised membership prices in awhile, as we're hovering near the dreaded $100 mark, but our increases are generally only $2 - $5.  Most people won't notice that, or if they do, they won't be overly irritated about such a small increase.

- You might consider offering a program for your current members to offset complaints.  New joiners aren't likely to notice that the price increased; it's your renewals who might.  Often, an organization will give current members advanced notice of a pending price increase, offering them the chance to renew now to get another year at the lower rate.  So, you wait until you're OK with putting the word out, and then send a note to whatever segment of your base you wish (could be just people expiring near the price increase, or it could be all current members!) explaining that the prices will increase to $X on date Y, and if they renew their current membership before that point, the can still get the old rate.  This can help mitigate complaints, as people will be warned and have an out.

-  Have a service recovery plan; if someone calls and is irate, know what you're willing to offer them.  Are you willing to let them renew at the old price for one year only?  Or perhaps to throw an extra month or two of membership their way?  We are almost always able to resolve customer pricing complaints by extending the membership; even people who miss a discount when they renew don't get a refund, they get their membership extended to compensate for the discount amount.  Much less work for us, less expensive for the organization, and it expands the member relationship by keeping them connected, rather than contracting it by losing the membership.

- In Tessitura terms, think carefully about how you want to set up your levels when you do the increase; you could just change the price ranges, or you could inactivate the old levels and create new ones for the new prices.  This is really just a question of tracking; 4 months after the new building opens, when you pull a "totals by level and type" report, are you going to want to see at a glance how many of your current members have bought in at the new level, vs how many are holdovers from the old pricing?  If so, you may want to do separate levels (or separate funds that all funnel to one GL).

We had a new building opening in 2000, and had a huge jump in membership - total number of members jumped by 50% in the first 6 months in the new building.  But beware your expectations for future years; once everyone saw the building, totals slid steadily.  Don't expect to keep your inflated number at its peak!

Let me know if you have any questions or want to discuss further; happy to help!

Beth


* * * * *

Get ready for an unforgettable encounter 3,000 years in the making. Tutankhamun: The Golden King and the Great Pharaohs opens at the Science Museum of Minnesota on February 18, 2011, bringing priceless artifacts from the tomb of the Boy King to Minnesota for the first time. Don’t miss this opportunity; visit www.smm.org/tut to purchase tickets today.

Elizabeth A Varro
Membership Manager
Science Museum of Minnesota
(651) 265-9829

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From: "Barrett Shaver" <bounce-barrettshaver9004@tessituranetwork.com>
To: bvarro@smm.org
Sent: Thursday, February 17, 2011 5:37:00 PM
Subject: [Tessitura Development Forum] Effects of Increasing Membership Prices

I'm wondering if anybody here has increased the price points on their membership levels and would be willing to share how that went. Did you see a significant change in your member counts? Did you see any correlations with other revenue lines, such as ticket sales or merchandise? Why did you choose to increase prices in the first place?

We're aiming to open our own facility at the end of 2012 after nearly 30 years of renting halls. We haven't increased our membership prices in a very long time. We also have high membership goals for the opening. It seems fairly common for many organizations to increase their membership prices at such a time, but of course some are concerned about backlash. 

Anything your willing to share about your own experiences is much appreciated! 

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