AAMSE Recap: Right-Sizing Your Membership

Imagine you are a fisherman, boating out to the deep blue ocean to catch your daily haul.  You cast a large net, capturing hundreds of fish in just that one toss.  You’re thrilled!  That is, until upon closer inspection only about one-third of the fish are able to be sold or eaten.  With that in mind, do you keep the whole catch, or do you throw back the bad ones?

In late July, I had the privilege of presenting with Stephanie Mercado, Executive Director of the National Association for Healthcare Quality (NAHQ), at the American Association of Medical Society Executives (AAMSE) annual meeting in San Diego.  Stephanie and her team have been an LRC client since 2016 and it has been tremendous to observe what they have been able to do towards “right-sizing” their membership.

Back in 2016, NAHQ was facing what Stephanie called “a silent crisis.”  While the organization was adding roughly 2,000 new members each year, they had been losing an even higher number for four out of the past five years.  Therefore, instead of growing at a 200% rate (assuming no churn) over that five-year period, they were growing at roughly a 40% rate.  Certainly nothing to scoff at, but she knew that only reporting the topline growth was deceiving and detrimental to the organization long-term.

Our presentation at AAMSE was intended to educate association leaders on three ways in which they can “right-size” their membership, by first introducing the concept and then overlaying what NAHQ was doing to combat their growth challenge.

1. “Right-sizing” means recognizing that it is cheaper to retain than acquire new.

When using the fisherman analogy previously, NAHQ fit the profile perfectly.  Leading a profession that was relatively new compared to healthcare in general, the organization was fishing in oceans, not ponds.  “Healthcare quality” included a wide variety of healthcare settings (acute care, sub-acute care, ambulatory care, pharmacy, behavioral health, etc.) and job functions (nursing, management, project management, finance, analytic, operations, etc.).

Casting a large net meant that NAHQ welcomed into their membership anyone even tangentially related to healthcare quality.  The result was a lot of wasted time and resource trying to satisfy the needs of individuals who weren’t great fits for the organization from the start. 

While it did not necessarily cost the organization any more time or resource to recruit or accept these new members, they were spending a significant amount of time trying to convince them to stay.  By over-reacting to the churn, they were inadvertently taking their eye off of growing the value proposition for and engagement of its core group of members.

The paradigm shift for Stephanie and her team was that these “back-end” costs of servicing bad fit members really needed to be considered as acquisition costs for the organization.

2. “Right-sizing” means not all prospective members are good fits for your organization.

As NAHQ shifted its strategy, it first defined who the organization was best positioned to serve and why.  They knew that this started with health systems, hospitals, and individuals who were full-time healthcare quality professionals.  Not individuals in emerging settings, and not individuals who viewed healthcare quality as a secondary or tertiary role or responsibility.  NAHQ would welcome the latter groups into the organization, but they would be careful not to over-respond or over-service their differing needs.

It then built its mission statement around that group:  to advance a coordinated, competent healthcare quality workforce across the continuum of care.  This first meant embracing its reputation as a provider of a highly-valued certification, the CPHQ.  It also meant flipping the script on being viewed as more of a certifying body than an actual membership organization.  NAHQ reinforced a value proposition that began with the CPHQ, but then made it incredibly difficult to leave:

  • Discounts on initial certification – included in membership.
  • Discounts on recertification – included in membership.
  • Unique and relevant content as well as continuing education for CPHQs – included in membership.
  • Product extension – beginner content for CPHQs to promote in their organization to train up their own staff (“CPHQ Principles”).
  • Product extension – advanced content for CPHQs to continue to build on their skillset and build professional development roadmaps for their staff (“CPHQ Essentials”)

These decisions now positioned the organization to serve its core group even better, but also extend their breadth of market with purpose, instead of over-extending or over-hauling their resource.

3. “Right-sizing” means differentiating your customers from your members (and responding accordingly).

One of the more significant challenges that NAHQ faced was not being able to communicate effectively with those “good fit” prospects.  A healthcare quality professional was not a commonly used title or job function, instead for many members they still called themselves “nurses” or “project managers.”  The NAHQ database could not distinguish those in full-time healthcare quality roles.  That meant they also could not differentiate individuals who simply wanted to be a customer – purchasing a webinar or getting the certification as one more credential on their resume – from those who could fully benefit from a long-term membership.

LRC’s profiling provided a much clearer picture as to who those “good fit” prospects were, by examining the strongly engaged members who described NAHQ as a “professional home” and the weakly engaged members who did not necessarily view NAHQ as offering career-long value.  This information then guided database build initiatives as the organization made a significant investment in an upgraded Association Management System.

LRC also conducted a form of journey-mapping which identified NAHQ’s best-in-class webinars as a key point in the customer/member experience.  Individuals who had participated in a webinar were twice as likely to stick as they were to churn.  The problem was that NAHQ had been charging individuals roughly $40 to participate.  The paywall was keeping current and prospective members from fully realizing the value of NAHQ’s educational content.  NAHQ changed its educational model, dropped the fees (industry partners now sponsor the content), and participation is now at all-time highs.

The result of all of these efforts is that first and foremost, NAHQ has improved member retention with expectations of continued improvement over the next several years.  Certification interest in booming, projected at 11,500 certificate holders by year-end 2018 (up from 7,500 in 2016).  Membership growth is steady, stable, and predictable, projected at 7,400 total members by year-end 2018.  And perhaps most importantly to Stephanie, her staff and Board members are highly engaged:  they are motivated by the changes that have occurred thusfar, they have the information and resources to do their jobs effectively, and they now have a clear direction forward.

The gist of the discussion was that as associations implement new growth campaigns, they are just as likely to dramatically reduce their retention rates as a result.  Why?  Because so many times growth campaigns end up targeting individuals that are bad fits, who end up as your “squeaky wheels,” “problem children,” and gigantic resource-wasters.

The fisherman is wise enough to know that the bad fish, if kept, will hurt his reputation.  NAHQ has experienced the challenges that come with trying to grow too quickly.  It has now made the decision as to who its focus will be, which means in some cases it must be willing to let bad fit members walk away.  At least, until it reaches a point where it is ready to grow with purpose and a strategy.

A link to the white paper (which was the foundation for the presentation) can be found here

Posted in Associations, Blog, Insights, LRC Blog.