International Museum Membership Conference: How Cutting-Edge Data Analytics Can Revolutionize Your Membership Program
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1 International Museum Membership Conference: How Cutting-Edge Data Analytics Can Revolutionize Your Membership Program Presented November 9, 2015 Avalon Consulting Group, Inc. All rights reserved, 2015 Avalonconsulting.net Cover Page 1
2 Here with you today David Saunders Director of Membership National Museum of the American Indian NMAI is committed to advancing the knowledge and understanding of the Native cultures of the Western Hemisphere, past, present, and future, through partnership with Native people and others. The museum works to support the continuance of culture, traditional values, and transitions in contemporary Native life. Edison Wato Director of Membership National Museum of African American History and Culture The National Museum of African American History and Culture will be a place where all Americans can learn about the richness and diversity of the African American experience, what it means to their lives and how it helped us shape this nation. A place that transcends the boundaries of race and culture that divide us, and becomes a lens into a story that unites us all. Scheduled to open in fall 2016, the museum is under construction on the National Mall in Washington, D.C., on a five-acre tract adjacent to the Washington Monument. Allison Porter President Avalon Consulting Group Avalon is a full-service direct marketing fundraising agency. Since 1997, Avalon has helped our clients raise millions of dollars to achieve their visions for a better world while building relationships with people who share their passion and support their important causes. 2
3 In today s session Through actual examples, learn critical ways to view your donor and member data to inform your marketing strategy. Learn how to recognize how underlying trends have changed over time, and how they vary by organization and strategy. Identify key metrics and performance indicators that are relevant for comparison, and what those comparisons tell you about the health of your file. 3
4 What are key performance trends? 4
5 Comparing key metrics and critical analytical views will give you a deeper view into the health, future performance, and potential of your member file. Retention List return on investment File composition File trajectory and impact of acquisition Member value Cross channel analysis Major donor pipeline Metrics should be compared over time, and to other organizations, when evaluating their significance. 5
6 Case Studies 6
7 National Museum of the American Indian 7
8 Situational Analysis: Membership program established in 1991 as part of the museum s capital campaign to open the Cultural Resources Center and the Museum on the National Mall. The museum opened in Sept Current membership of 40,000 households nationwide. 70% of members live outside the DC and NYC metropolitan areas. Members and revenue increased dramatically through the opening of the museum, and then experienced a sharp decline. NMAI has been hard at work to stabilize the program since this time. 8
9 Key Trend #1: After the museum opening, NMAI experienced a decline in revenue both due to the event and a decrease in acquisition investment. Also, effects of 9/11 on DM industry. $5,000 $4,500 $4,000 $3,500 $3,000 Museum Opening Thousands $2,500 $2,000 $1,500 $1,000 $500 $ This view shows the impact of acquisition year over year. 9
10 Key Trend #3: After reduced acquisition, NMAI strategically reinvested in direct mail to rebuild the file. 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 New Joins Reinvestment FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Direct Mail Web 10
11 This investment has paid off revenue has started to grow after years of decline. $3.5 $3.0 Growth: 8% Growth: 2% $2.5 Millions $2.0 $1.5 $1.0 $0.5 $ Join Year
12 Key Trend #3: After reinvesting in acquisition, NMAI has seen a subsequent decline in first-year retention. 90% 70% 50% This is not an atypical trend but it is one that will be watched closely. Retention should be reviewed frequently to recognize potential issues as soon as possible % 65.8% 55.0% 30% 27.0% 23.2% 10% FY08 FY09 FY10 FY11 FY12 FY13 FY14 Overall Overall w/reinstates Multi-Year First-Year
13 Key Trend #4: NMAI has used cross-channel views to identify trends by channel and diversify revenue since the museum opening. Thousands $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Mail TM Web 13
14 Key Trend #5: Key Trend #5: Members giving through multiple channels show higher income per member. $78.52 $73.80 $70.90 $62.76 $56.70 $55.10 DM, TM, Web and DM and DM, TM and Web DM and Web DM and TM DM Only Income/Member 14
15 Moving forward: NMAI will continue to build on current progress through added investment. As the program grows, regular review of metrics like retention are key to maintaining file health. NMAI continues to explore options to increase multichannel giving and build value within the current file. 15
16 National Museum of African American History and Culture 16
17 Situational Analysis: Program established in Sept 2009 to build a membership base to support planned museum opening in fall NMAAHC has grown dramatically since that time, reaching a high point of 42,821 active members in July The program will continue to grow through the September 2016 opening. Maintaining a strong and stable base of membership support beyond 2016 is a priority for the new museum. 17
18 Key Trend #1: NMAAHC s membership program has increased steadily since the inception of the program. Millions $3.5 $3.0 $2.5 $2.0 $1.5 $ $0.5 $ Steady and generally increasing acquisition investment has allowed the program to grow year over year. 18
19 Key Trend #2: For a start up program, increasing the ratio of multi-year to single-year members is a key goal. 40,000 30,000 20,000 10,000 0 FY10 FY11 FY12 FY13 FY14 FY15 Multi-Year Single-Year NMAAHC now has more multi-year members than single-year members and has continued to build year over year. 19
20 Key Analysis: List Return on Investment Assessment Black Tie Democrats Black Literary Club African American High $ Democrats League of Women Voters African American Democratic Contributors American Heart Assn Wash Spectator Environmental Defense Fund Common Cause Native American Rights Fund Negro Leagues Baseball Museum Sierra Club NAACP National Museum of the American Indian Multibuyers AICR AFRICAN AMERICAN CONTRIBUTORS NAACP Leg Def & Ed Fund Because upfront performance and long-term value are not always aligned, NMAAHC utilizes return on investment by acquisition list to strategically build the membership program. 0% 100% 200% 300% 400% 500% 600% 20
21 Key Analysis: Acquisition Package Return on Investment Bookmark PR Bookmark PR OSE Test Survey PR Plypak PR Slavery PR Poster PR NMAAHC has tested a number of acquisition packages during the program start up. Assessing long-term value allows NMAAHC to better make decisions about the growth of the program. -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 60% 21
22 Key Trend #3: Using key analytical tools for guidance, NMAAHC has gradually increased member value since the start of the program. $160 $140 $120 $100 $80 $60 $40 $20 $0 Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 FY09 FY10 FY11 FY12 FY13 Member value by 4-5 years is strong compared to other organizations. 22
23 Key Analysis: Long-range forecasting to predict future trends 50,000 45,000 40,000 35,000 MEMBERS 30,000 25,000 20,000 15,000 10,000 5,000 0 Museum opening end of FY16 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 $4,000,000 $3,500,000 $3,000,000 REVENUE $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 continuing reactivating 2nd year new Gross Revenue Net Revenue NMAAHC is using forecasting to predict the trajectory of the file and anticipate future changes. Based on this analysis, investment strategies will be outlined to guide the program. 23
24 Moving forward: NMAAHC will continue to watch key performance trends as the file continues to grow. Using analytics, NMAAHC has an opportunity to anticipate and address future trends to maintain stability during the volatile window after the museum s opening. NMAAHC will be focusing on member retention strategies to preserve the strong base of the program after the opening of the museum. 24
25 Friends of Smithsonian 25
26 Situational Analysis: Friends of Smithsonian is a mature and robust membership program with a member history that stretches to before Currently, there are nearly 80,000 active Friends. After years of growth, the program has been steady in recent years. FOS has developed a structured donor track to help reinvigorate the file. The Friends program is actively seeking ways to return to a pattern of growth through increased acquisition of both members and donors. 26
27 Key Trend #1: Based on current acquisition levels, the program is expected to decline through ,000 80,000 Projected 70,000 60,000 50,000 40,000 30,000 new reactivating 2nd year continuing 20,000 10,000 - FY10 FY11 FY12 FY13 FY14 FY15 FY16 27
28 Key Trend #2: FOS has implemented a structured donor program to drive more supporters into the program and offset member decline. 25,000 20,000 15,000 10,000 5,000 0 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Single-Year Members The donor program has increased dramatically since Single-Year Donors
29 Key Trend #3: The donor program is projected to increase, in line with the current trend. 10,000 9,000 Projected 8,000 7,000 6,000 5,000 4,000 3,000 new reactivating 2nd year continuing 2,000 1,000 FY10 FY11 FY12 FY13 FY14 FY15 FY16 Predictions of file trajectory are crucial in guiding decisions around acquisition investment. 29
30 Key Trend #4: Long-term value analysis indicates that members are still worth far more than donors, but these metrics should come more in line as the program evolves. Members vs. Donors - $50 level Year 5 Year 1 Donors Members $0 $50 $100 $150 $200 $250 FOS will continue to monitor this trend with ongoing analysis. 30
31 Key Trend #5: Strong and improving first-year retention metrics indicate that added acquisition investment can be sustained. 52.7% 51.5% 49.0% 46.8% 54.2% 52.4% 52.9% 53.4% 56.2% 53.7% 19.5% 21.1% 22.5% 17.9% 17.3% 17.5% 14.9% 19.9% 25.5% 30.4% FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Members Donors 31
32 Key Trend #6: The Friends program also has a strong feeder track to major gifts. Upgrading is a priority and is closely analyzed. 6% 5% 16% 44% 4% 26% <$75 $ $ $ $ $1, % of $1,000+ multi-gift Friends started with a first gift below $75. 70% started with a gift below $
33 Moving forward: With the goal of stability and then growth, the Friends program will use this analysis and more to project future trends and inform decision making. Strong donor-level metrics (retention, long-term value) indicate added investment is wise and will return quickly. Regular (quarterly and annual) review of key performance metrics allows FOS to keep tabs on key trends and changes as the new donor program evolves. 33
34 Wrap Up 34
35 How do you do this for your program? Quarterly and annual oversight of key metrics through dashboards and full file analysis. Identificatio n of changing performanc e trends. Continuous goal evaluation, resetting, and forecasting. Education and reporting to leadership. REPEAT. 35
36 Questions? 36
37 How Cutting-Edge Data Analytics Can Revolutionize Your Membership Program David Saunders Director of Membership National Museum of the American Indian Edison Wato Membership Program Manager National Museum of African American History and Culture Allison Porter President Avalon Consulting Group x
International Museum Membership Conference: Improving Your Museum s Retention and Driving Revenue
International Museum Membership Conference: Improving Your Museum s Retention and Driving Revenue Presented November 7, 2016 Avalon Consulting Group, Inc. All rights reserved, 2016 Avalonconsulting.net
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