Loyalty, competitors and value perception for traditional memberships

Marketer and event coordinator Jules Protesaru summarises what our latest Clubhouse chat dived into.

Ah, Clubhouse. We’ve jumped on that bandwagon. 

And after a few weeks of listening in, we ran our first experiment that took four of us away from simply being flies on the wall, but rather speakers. We scheduled our first ever room, and our half an hour chat started with four speakers, ended with five. We talked Gymshark, Ikea, Amazon Prime, British Cycling and Huel.

The starting point of the discussion revolved around our newest paper on membership experiences, and we started off with some facts explored in the playbook: “one in three people tells us they join a membership for the experience, followed by a sense of community and lastly, offers.”

“One in three people tells us they join a membership for the experience, followed by a sense of community and lastly, offers.”

The real job-to-be-done for memberships

This led us down a path where we chatted about the real purpose a membership fulfils, which is different for all of us.

We started a debate around memberships and subscriptions in an attempt to define the differences between the two. People are becoming more accepting of recurring fees and getting value on a regular basis. Something both subscriptions and memberships share.

But the lines are blurred between memberships and subscriptions because the two are inherently linked through the relationship a person has with the organisation. At a minimum, such as in the case of subscriptions, is transactional. The value sits specifically with a direct benefit passed on to you in exchange of money.

Seeing value in memberships

And when we started talking about perceived value, that’s when things got really interesting. 

We eventually concluded that memberships are less about the frequency or act of the transaction, but more about the type of relationship and value that people establish and get out of their membership. As members, we expect to feel like we’re getting some benefits that are not necessarily listed on the joining page, like socialising with members, finding a cause that’s worth advocating for and discovering benefits that transcend a simple transaction. The sense of community or the concept of “life-enhancing” became two distinctions we felt were quite solidly embedded in the “membership” camp, and likely to influence how we perceive the value of memberships.

Attention detractors are the new competitors

The chat went into who the real competition is for memberships, away from their own space, and more into the “attention detractors” realm. Hear me out. 

There are many things that distract people away from thinking of their memberships as the go-to option when they are looking for time fillers, joy or personal and professional growth, to name a few. Competitors no longer belong to the same space memberships do, but rather they are services, apps, entertainment options etc. all of which compete for your members’ attention. It means members actively choose different value offerings, where they are more enjoyable, easier to use or more affordable than their membership. This makes it increasingly more difficult to demonstrate value. But it’s also an incredible opportunity to identify new touchpoints, add delight and value and create memorable experiences, especially when the aim of memberships should be to have a frequent and ongoing relationship with your customer.

Loyalty who?

Which led us nicely into the concept of “loyalty”. 

We talked about where loyalty schemes play a role, and how they cultivate non-emotional loyalty born out of necessity, not emotion and how advocacy groups drive sales.  

We looked at how Ikea has used memberships to capitalise on essentially owning “headspace” when it comes to specific life moments, such as moving into your first home, building emotion-based loyalty. 

Adding memberships to your offering

If brands are looking to make a transition from a subscription service to offering a membership service, the speakers touched on the factors that would ensure success: hype, proven value and an already socially-active user base. 

When loyalty and true buy-in to the brand result in a community of people who are hyped about the products being sold, and they have an active community, then that brand has essentially gained their followers’ permission for a membership scheme to be successful. They’ve proven their value over time and they created value that goes beyond the transaction. 

"People are going to find loads of value in your membership, and some will not. Should they be paying the same?"

For businesses that don’t have that yet, the lesson is: don’t go too quickly in putting these schemes in place thinking that loyalty appears overnight. If you don’t have that level of advocacy, then work on identifying the level of emotional connection you have with your customers. Is it relevant to introduce something like this in the first place? If so, where along their journey does it make sense to do it?

Food for thought...

We concluded with a “food for thought” type of question: "People are going to find loads of value in your membership, and some will not. Should they be paying the same?"

👋 If you want to join us on Clubhouse, our next chat is this Friday. 

📞 Want to talk memberships? Drop me a note.