Many clubs have been tempted to give in to deadly tactics for the sake of growing their membership. Here are the “Seven Deadly Recruitment Sins” all clubs should avoid.
Deadly Sin #1 – Advertising
This extends beyond tax and privacy regulations. Think about what message an advertisement for membership sends: “Come join our excellent private club—now accepting anyone who reads this publication. Please hurry.”
Rare exceptions include cleverly disguised thank you ads, and congratulation announcements for members who win awards or for welcoming new staff. Your club should cultivate publicity only to enhance its brand.
Deadly Sin #2 – Discounting
Offering deals, discounts or coupons to join a club undermines its integrity in the eyes of current and potential members. The economic downturn, coupled with the overbuilding of golf courses in most markets, has led many clubs to roll back their joining fees with mixed results. Some have had short-term spikes in membership and others have met with disaster. In most cases, even the clubs that saw membership rise with discounting could have achieved significant increases without a price rollback and could have avoided the significant hidden costs of price cannibalization, including shorter retention of new members and long-term negative consequences of making existing members feel imprudent.
Campaigns can offer enticements without wholesale price cuts through financing or other incentives. Cheaper memberships are seldom in the best interest of the club and its members.
Deadly Sin #3 – “Buying” Referrals
Nothing throws cold water on the idea of rewarding membership referrals with payment like a member turning down a $500 cash referral incentive out of embarrassment should his friend learn that the member had been paid to sponsor the candidate. In other cases, the referring member passes the discount along to the applicant (see Deadly Sin #2 – Discounting).
Cash for referrals will motivate some members, but the majority will be quietly turned off. The problem results from turning a social situation into an economic one. The next time you are a dinner guest, try giving the hostess $50 from your wallet instead of bringing wine. The expression on her face would reflect the impact of referral compensation on your brand.
Deadly Sin #4 – Paying Realtors
This seems like it should work. Realtors see many new homebuyers and often specialize in target neighborhoods or subdivisions. Commission motivates realtors.
Unfortunately offering incentives to realtors is counterproductive. Realtors will use the club to better position themselves to make a property sale, but offering them money can complicate their business by creating disclosure headaches. Top producing realtors in targeted areas should be cultivated by helping them look smart: Offer them packets at their office or allow them access to give a tour. Good and loyal realtors can be real assets. Buy them a bottle of wine for a good referral but avoid quid pro quo. One more thing: Realtors seldom make good membership directors.
Deadly Sin #5 – Poor Database & Communications Platform
When clubs say they have tried everything and now are ready to lower prices to attract members, it’s a good time to consider “asset neglect.” Often those same clubs will report that they have a database of member inquiries that didn’t work out. This is the equivalent asset neglect of losing a green, but it is hidden, common and can be fixed for less than $500.
No one needs a club membership. Membership is an emotional event. These truths underpin all we do in club positioning and member recruitment. Timing can make a world of difference to potential members and simply providing a club tour at the initial inquiry is not enough. Pertinent prospect information should be maintained in a database that allows for easy mailing, e-mailing and monitoring. Codify prospects by interests and the frequency by which they are sent information. A multifaceted approach with e-mail updates, short online prospect surveys, regular mail and targeted invitations to a variety of showcase events is superior to any one approach.
Deadly Sin #6 – Ignoring Retention
It is easier to maintain members than replace them. Annual membership attrition rates greater than seven percent should be analyzed. Are you surveying members regularly to measure their relative happiness? Do you have reliable communication paths to let members blow off steam and communicate grievances so someone can resolve the issue? Are members proud to bring guests to the club? Are you monitoring members who trigger food minimums to see why they aren’t using the club?
Conduct exit interviews with board members or the GM that go beyond the administrative resignation process. Document the real resignation reasons and save those who can be retained. Even those who leave will like their club telling them they’ll be missed.
Deadly Sin #7 – Eroding “Privacy”
There are cheaper ways to golf, play tennis, work out or dine than by joining a private club. Members pay initiation fees, dues and food minimums to be part of something special.
Many clubs fret over “under-utilized amenities.” These clubs often try to have their cake and eat it too by allowing limited public access. Tournaments and banquets are the most common (and least problematic) version, but beyond that the ice gets thin. Once nonmembers can get the same thing a la carte, members will wonder why they pay dues.
Damon DeVito is managing director of Affinity Management, which has advised and managed clubs in 26 states since 1997. For more information, visit www.affinitymanagement.com or contact [email protected] or call 434-817-4570.