Since acquiring new members is a time consuming and expensive endeavor, it is vital that every possible effort be made to retain them. Here are some pointers on this fundamental fundraising strategy.

When and How to use Renewals

A good renewal program is the backbone of any individual membership program and can generate significant funds for even very new organizations. If you have decided to recruit dues-paying members as a way to build your organization, you MUST develop a systematic way to ask those members to give again once their membership expires. This means that you must have a system for tracking and recording your members' gifts and the resources to mail three to five renewal notices to your members to get them to renew the following year. The beauty of a renewal program is that it is relatively inexpensive to implement, and the monies generated can be used for whatever you need them for, including general operating support.

Members Versus Donors

Why use the terms "member" and "renewal" at all? Why not just write to your mailing list several times a year asking them for "donations"? Repeatedly, statistics show that people like the idea of "belonging" to an organization and receiving some kind of "member benefits," and that 2 to 3 times more contributors will send money in response to requests asking them to renew their membership than will send gifts in response to "special appeals" for funds. Special appeals have their place, too, but should be used strategically to ask renewed members for additional gifts and to provide one more opportunity for those donors who haven't yet responded to your renewal requests.

Member Cultivation

In planning your membership renewal effort, it is important to remember your objective—to build lasting relationship with your members so that they will continue to support your organization for years to come. Once members have renewed their support for an organization two times (three gifts), statistics show that they will usually remain loyal for seven years or more. What's more, they are much more likely to contribute to special appeals, attend special events, and buy merchandise, and so on, than new members. Finally, 10-15% of renewed members will upgrade their gifts the next time they are asked. To this end, it is important to nurture your first-time and renewed members so that they are motivated to continue supporting your organization. In addition to thanking your members for renewing, other things you can use to build these relationships include:

• A new member welcome kit
• Regular newsletters or bulletins
• Invitations to special events
• Your annual report
• Personal letters or phone calls
• Online alerts or postings

The important thing is not to look at your membership program as simply a once-a-year cash exchange. You must get to know your members, educate them about your good work, and motivate them to give again and again.

Establishing a Renewal System

The key to getting a high renewal rate (in addition to good communications) is to ask your members to renew from three to five times during the course of the year. Each time you ask, some members will send in their dues, but others will forget, or lose the reply envelope, or throw away the renewal request because they are feeling cranky. You need to provide a number of opportunities for recalcitrant members to give, and vary the approach a little each time.

In order to do this effectively, you have to create a system for renewals, based on your own particular needs, and stick by it, come hell or high water! If you do this religiously, you will almost certainly be rewarded with a 60-70% renewal rate (this rate will be around 50% for first-time members and closer to 70% for old-timers). Chart No. 1 illustrates the results of a series of renewal mailings using five renewal requests. There is nothing magic about the numbers or the suggested themes for letters, used in this chart. You may want to do more requests, or to vary the order by putting the phone call in the middle, or omitting it.

Scheduling

In scheduling your renewal mailings, it is important to keep your system simple and doable. If you have a small number of members (i.e., 100-1,000) it may be best to do all your renewal mailings at one time, say between May and October. (See Chart 2 below). A simplified schedule has the advantage of reducing the number of mailings you do and leaving other times of year open to do other kinds of "asks" such as special appeals, events, etc.). The disadvantage of this system is that a new member who joins in December will be asked to renew four or five months later. I have found, however, that most people do not track their giving that closely, and the renewal letters can contain a disclaimer saying "To keep our fundraising costs low and simplify our workload, we mail renewal notices to all our members at the same time. Even if it has not been a year since your last renewal gift, please consider renewing now to save us the time and paper involved in repeated mailings."

With a larger membership (1,000+), you may want to expand your schedule so that your members' renewal dates correspond more closely with their join dates. Chart three below gives a timeline for quarterly renewal mailings, where notices are sent out for a given renewal group at the beginning of each quarter, and every month thereafter. One advantage of this schedule is that it spreads income from renewals fairly evenly across the year rather than consolidating it in the May to October period as the above schedule does. Again, almost all the mailings (except for the 4th Quarter expires) are over by December, which is a good time of year to send out a special appeal to all
members except those receiving their regular renewal notice. This scenario is appropriate for groups doing mailings that will reach their destination fairly quickly, since it does not allow a great deal of time between mailings.

KEY:
X = Members whose memberships expire during January, February, or March.
O = Members whose memberships expire during April, May, or June.
* = Members whose memberships expire during July, August or September.
Z = Members whose memberships expire during October, November or December.

There is nothing magic about the schedules shown above and each group should come up with a schedule appropriate to its needs and resources. The important thing is to have a system which insures that members are asked to renew their giving regularly and repeatedly.

Using Newsletters for Renewals

If you have a newsletter, you can use it as an effective renewal device. The most effective way to do this is to print the member's renewal date in a prominent place on the newsletter label. Then, you can add a statement somewhere within the newsletter saying that the member's renewal date is printed on the label and to save time and paper, members are encouraged to send in their renewal dues when they come due. To make this easier, you can enclose a self-addressed envelope with the newsletter (a good idea anyway, since even members who have renewed may be motivated by something they read in the newsletter to give an extra gift).

One caution: most groups (there are always exceptions) will never reach their maximum renewal rate using newsletters alone. To get to a 60-80% renewal rate, you will still need to do a series of renewal mailings as outlined above. However, combining newsletter renewal notifications with a series of mailings will optimize your renewal system by maximizing the number of people who renew and reducing your costs for postage and mailing.

The Renewal Package

The main components of the renewal package include:

• The Renewal Letters
Renewal requests can be shorter than new member letters, since the recipient already knows who your group is and what you do. However, the more personalized they are, the better chance for a positive response. Handwritten notes on renewals are especially good.

With whatever variations you wish, your first renewal request should include: 1. A statement about it being time to renew their membership; 2. A paragraph about some of the important things their dues will help accomplish; 3. A description of the benefits they will continue to receive; 4. A thank-you for past support, and if possible, a mention of what they gave last year and a request for a specific amount for the current year (the same as last year for 1st year renewals, a slightly increased gift for 2nd year and subsequent renewals); 5. A statement that their dues payment is tax deductible.

Subsequent (2nd, 3rd, 4th) requests can be worded slightly differently, emphasizing how important your members' continued support is, highlighting some particular need, or even asking them to tell you why they have not renewed, but should repeat in some form the five elements outlined above. Ellis Robinson, author of The Nonprofit Membership Toolkit," suggests that even if you are doing quarterly mailings to four different groups, you can focus your renewal letters on seasonal issues and use the same letter for all four groups, (and even use these same letters several years in a row, with minor changes) making your life much simpler and easier.

One advantage of computerized membership software is that it lets you personalize renewal letters, as suggested above, fairly painlessly using mail merges. Because of the increasing difficulty in acquiring new members, I believe it is worth investing in good membership software that will enable groups to do this kind of personalization even for fairly small member bases in order to retain more of these hard-won new members.

• The Response Card
The response card/form provides a place for members to indicate that they are renewing their support and at what level. It will be mailed back to you along with the member's check, so it needs to fit comfortably into the response envelope provided.

To make things as easy as possible, the response form is usually a separate piece, but it can also be a part of the renewal letter, set off by a dotted line to indicate that it needs to be cut or torn off. The important thing is to provide the member with something to fill out and send in with the dues payment to insure that the check will be properly processed. Response cards can also be used to gather additional data about the member, such as whether they are interested in planned giving opportunities, or work for a company with a matching gift program.

• The Reply Envelope
The reply envelope is an essential part of the renewal package, because it makes it easy for your member to respond. It is smaller than the outside envelope in which the renewal letter is mailed, but large enough so that the reply card fits into it. It is self-addressed so the member doesn't have to bother with that task. It is not necessary, however that the envelope be "Prepaid" or a "Business Reply Envelope." Most studies indicate that members are willing to affix their own postage.

• The Carrier Envelope
Often, people use a window envelope for renewal letters, and put the member's label on the enclosed reply card/form in such a way that it shows through the window. This way, the member does not need to write their name and address unless changes are needed. You can print or stamp the outside envelope with the words, "Renewal Enclosed," or "It's time to renew!" to get attention. If you are doing small quantities of renewals, and can bring in volunteers for a mailing party, hand-address the envelopes and use first class or bulk mail stamps. Such personal treatment usually produces better results.

First Class vs. Bulk Mail

There are no hard and fast rules on whether to use first class postage or bulk mail with renewals. Each organization needs to experiment with this and find out what works best for them. To use bulk mail there must, of course, be at least 200 pieces of mail to begin with, and the organization must have a bulk mail permit. Mail bearing bulk mail postal indicia does take longer to arrive, there is more chance of it being lost, and it is not as appealing or personal to the recipient as an envelope with a live stamp.

Boosting Response

Some Techniques which may help boost renewal rates include:

• Deadlines. As with other kinds of requests for funds, communicating a sense of urgency by citing a deadline in your renewal letter may boost response. Examples include a membership expiration date ("Your membership in Friends of the Potomac expires on May 3), or a funding challenge ("Our monitoring staff must have funds in hand by June 1").
• Membership Surveys. Some experts say that using a brief membership survey in your renewals can lift your response. Keep it short and simple, but make it real by asking questions that you want the answers to, such as "Do you read our publications?," or "What magazines do you read?" When you get the responses, report the results to your members in your newsletter or annual report.
• Automatic Renewals. A number of organizations have been successful in increasing their renewal rates by encouraging their members to pay for their dues using credit cards or electronic billing systems. Members authorize the organization to automatically renew their dues unless notified otherwise subsequent to receipt of a billing notification letter. To motivate donors to select this option, organizations cite the savings in staff time, renewal mailings and postage, and sometimes offer these members such incentives as a reduction on renewal dues, or several months of free membership.
• Online renewals. Don't overlook offering this option to your members. More and more people are using computers to carry out all their day-to-day activities, so make it easy for them to click a button and ante up for another year. Be sure you tout the benefits of online renewal in your publications ("You can save us time and money by renewing online!") and consider offering online renewers a special incentive of some kind.
• Telephone contact. According to the experts, the most effective way to reactivate lapsed members is to call them. This is especially true at the tail end of a renewal series. However, phoning can be costly, so unless the calling is an all-volunteer effort, it is best to seek the advice of an expert before setting up a renewal phone-bank.
• Matching gifts/leverage. Many members are motivated to renew by knowing that their gift will leverage other giving. If you can find a donor or funder who will actually offer to match renewals, this can be a powerful incentive for your members to renew.
• Renewal Premiums. Offering a premium increases costs significantly and may create an expectation on the part of your members. In general, premiums should be used sparingly for renewals and are best suited to upgrades (getting your members to increase their annual giving level) and sweetening the appeal of your third or fourth renewal request. That said, if your organization has a special incentive you can offer members for renewing that is very low cost, such as a ticket in a raffle, or a bumper sticker or map, it may increase response to a particular renewal mailing.

  Whenever you do offer premiums, be sure to give your members a chance to opt out by including a box saying "Please don't send me a gift, use my entire donation for your program work" on the response form.

Members who fail to renew but give to appeals or events

Members who fail to respond to your renewal letters but do give to a special appeal or an event during a given fiscal year should be automatically renewed and given a new renewal date at the beginning of the next fiscal year. Most databases cannot do this kind of sophisticated updating accurately and dependably, so you may have to do it manually by looking at the giving history of your lapsed members at the beginning of each new year to see who should be renewed. The reasoning behind this is that members are a precious resource, and anyone who has given any kind of gift (above a reasonable amount, of course) should be kept on your list and asked to give again

Tracking Your Data

It is essential that you track and analyze the responses to your renewal requests so you can see which letters were most effective, which times worked best, which letters produced the highest average gift, and so on. This attention to detail will allow you to learn from your successes (and mistakes) and adjust your renewal system accordingly. You can do the tracking manually, but if you have a good member database, you can probably create a report using the data entered for each renewal request.

It is also essential that you keep certain data on your members in order to ask them to renew in an effective and productive fashion. At a minimum, you need to record which request they responded to, and the date and amount of their last renewal gift. Your system should allow you to produce mailing labels for segments of your list based on renewal date and amount. You also need to be able to easily exclude members based on renewal date or amount so you can exclude people who give to the first request from the second mailing, and so on.

Because of the complexities of renewal mailings, even groups with memberships of less than 1,000 should give serious consideration to buying a good membership software program or having a computer service handle their list.

Renewing Major Donors

Because major donors give significantly higher amount of money, their renewal letters will differ from your regular renewal requests. See the chapter on Major Donor Programs for more on renewing major donors.

Expired Members

Once members have been sent 3-4 renewal requests and asked in several other ways to give, without success, their names should be removed from your active membership list. With small groups, it is tempting keep mailing your materials to these unrenewed members, particularly in small communities where every member counts. If you MUST keep certain individual on your mailing list, see "complementary members" in the Member Recruiting Chapter. Remember, if you continue to provide all your expired members with benefits, such as your newsletters and other publications, there is no real incentive for them to renew.

But this 30-40% of your members should not be deleted from your database. Rather, they should be reclassified as "lapsed" or "expired" members, and shifted to the "New member prospects" category in your database. These lapsed members constitute your best "prospect" list for new member mailings. Lapsed members should be mailed to once or twice a year and asked to rejoin. Mailings to lapsed members produce results which are significantly higher than mailings to people who have never been members, so this list should be maintained and added to each year. The names with the oldest expiration dates can be gradually culled after they have been mailed to without results many times.

Nurturing your members and getting them to renew their membership each year is probably the most important thing you can do to insure a healthy, sustainable base of support for your organization. These loyal members will provide the pool from which your board members, major donors, event attendees, planned givers and other contributors will come. Your hard work in keeping this group informed of your activities and up to date in their dues will pay off in spades.