[Finance] Question regarding membership turnover rates

Wed Dec 16 19:32:30 CET 2015

SHORT:

Yes, your cleanliness problem is a problem. It makes the experience
off-putting, maybe even dangerous. No, your CRM is probably not a problem.
People are used to crappy software and they just put up with it. Yes, you
almost certainly have other issues that you haven't mentioned. Most
hackerspaces--most volunteer orgs in general--I've seen have had no
explicit on-boarding process, leaving prospects and new members to
flounder, get frustrated, and leave.

LONG:

In all types of volunteer organizations: even though you're a non-profit,
you are still selling the organization. People will be *spending *time
there, and some money. The three steps to sales are: get people in the
door, convince them to buy, and convince them to come back. Churn is the
negative space of all the people who decided to keep coming back. You
"convert" when you go from "off the street" to "signed up". And you
"activate" when you go from "signed up" to "actively involved". When you
lack any sort of process for converting prospects and activating new
members, you get churn as a result.

How many of your 42 members come in to the space at least once a week?
That's your activation number, any less frequent than that is just not
active enough to count on to do any work around the place. It's probably
pretty close to the same percentage of people who come in your door and
then sign up.

It can be a little misleading for a small organization, as individual
ideology can have an out-sized effect and skew the numbers. 3 active people
out of a membership of 10 is technically 30% activation, but it's also just
not enough data to go on. Measuring how many people come in the door versus
sign up is better, as there is more data to go on, but most places don't
have those numbers. It's best to know both, of course, but problems in one
are usually cultural problems within the organization that will also
manifest problems in the other, so they are usually closely tied.

For most organizations that are not hurting themselves--but also not
helping themselves--you can expect about 10% self-activation. If there are
cultural problems within the organization that make the place off-putting
to anyone outside of a certain clique, you can probably only expect
activation to reach 5% at the best (though 1% is more likely). If you're
absolutely killing it on the activation game, i.e. you have a real process
and a person who is dedicated to it and performing it, you can get as high
as 20%, but that's about it, you're fighting basic human nature after that.

Stages of activation are multiplicative. If you're only hitting 5% between
each of those two stages, you need 400 people to come in before you find
your first activated member. Just how many people are going to visit your
space every year? If you can get to 10%, that's only 100 people in the door
per activated member.

It starts with getting people in the door: that's your marketing. If you
don't have a constant stream of new people, you'll slowly wither away and
die. This is as much going to other people's events as it is hosting and
advertising your own public events. You can't fish from home, you have to
get in the boat and get out in the water.

Convince people to sign up: this is your sales pitch. You have to have a
good face on. Clean the space up. Get that cleanliness issue under control.
Even during renovation periods it's possible to present the renovation in a
clean, professional manner. People understand that things are works in
progress, but a messy space is a dangerous space. You also need to get good
about greeting people when they come in to see the space. I've seen several
hackerspaces who don't have anyone assigned to greeting. It would be nice
if we could count on the "it's everyone's job" message to work, but
frankly, that presumes a large number of activated people, which is the
problem we're trying to solve, so it's far easier to make it one person's
job and rotate it every day or week. You lose a ton of people at the door
if they come in and there is zero indication what they are supposed to do
or to whom they are supposed to talk.

Get them to come back: this is your facilities and the experience they have
with your current members. You have to have an understanding of how new
people *actually* perceive their relationship to the space when they come
in, rather than just assume they will be able to wade in and fend for
themselves. Your current membership has to be well-behaved. You rely on
them to be able to pay the bills, but in a small organization any one bad
attitude has an out-sized effect on the whole. You have to make sure your
current membership are also people who want to see the space grow. They
*should* want to see the space grow, because it's the only way to keep
enough money coming in to the space to keep the lights on. But people
aren't 100% rational and a lot of your membership probably just want to
keep their heads down, not think about problems they don't understand, and
work on stuff they do.

On Wed, Dec 16, 2015 at 12:16 PM, Shirley Hicks <shirley at velochicdesign.com>
wrote:

> We’re coming to the end of our startup phase, in that three labs are built
> and fully usable, a new, much larger woodworking shop is coming on stream,
> and, as soon as that is done, we’re doubling the size of our circuits and
> electronics work area.
>
> We’ve had a high rate of churn with newcomers coming in, but about a third
> staying on. (yes, I took over the treasurer’s role two months back, and
> yes, I’m reviewing our numbers as part of preparing for year end and our
> annual report)
>
> I strongly suspect that is due to the sheer amount of work we’ve had to
> put in building and reshaping the space. We ended up taking a larger space
> than was optimal, because it was the best of what we could afford in the
> city core, at a price we could afford. The trade-off has been that it has
> required significant renovation - and investment of time and material
> purchases by the lead members who’ve had deeper pockets. Combine that with
> about a third of the core membership actively involved in two separate
> product development projects (which are going to launch) and we’ve all had
> our plates full.
>
> Management and coordination of the work required has not always been as
> tight as it could be, and a couple of our member/lab hosts don’t have the
> “tidiness gene” baked in firmly enough to ride herd on a couple of our
> messier members.
>
> We had around 37 core supporting members this time last year; we’re
> pushing 42 now. But there has been a lot of churn - only four of our
> original founding 17 are still with us.
>
> Some of that is the CRM experience (we opted for Wild Apricot CRM for
> small nonprofits, and I’ve had to push our tech admin to buy in to getting
> the third-party SSL cert required for full integration with our WordPress
> site.
>
> This may be more appropriate for the general list. I’m a tad frustrated at
> the moment as I want things to “just work”. But some of our choices
> (including ones I’ve made) aren’t helping.
>
> — Shirley
>
> > On Dec 16, 2015, at 8:29 AM, Shirley Hicks <shirley at velochicdesign.com>
> wrote:
> >
> > Good morning everyone,
> >
> > What are your annual membership turnover rates like?
> >
> > I’ve taken over the treasurer’s role - and as part of that, a reviewing
> our membership churn in our third year of existence.
> > Am wondering what normal range is and when to get worried about member
> experience.
> >
> > Shirley Hicks
> > Treasurer, Red Mountain Makers.
> > Birmingham, AL
>
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>
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