Basic memberships: More trouble than they’re worth?

Vermont Public Radio president Robin Turnau said VPR stopped offering basic memberships after shifting its focus to building its sustaining-membership program.

Basic memberships offered during pledge drives and in direct-mail appeals are a time-tested enticement for converting pubcasting viewers and listeners into contributors, but station-based development staff are perplexed about how to set the rate for this donation level. Some pubcasters are weighing whether to stop offering basic memberships altogether.

A survey conducted this fall by Plymouth, Mass.–based direct-marketing consultant DMW Direct found that most stations charge below $50 for a basic membership, and few have adjusted the rate within the last five years. The basic median rate among the 41 public TV and radio stations that participated in the survey is $40, but 16 stations reported to DMW that they charge less.

These rates are far below average gift amounts for public stations. In 2011, public radio stations received an average of $144 per donor, according to a “State of the System” analysis presented at the Public Media Development and Marketing Conference in July. The average contribution to a public TV station was $127.

The presentation by Target Analytics, derived from fundraising results of 42 public stations, found that donors contributing less than $50 a year made up about 20 percent of pubcasting’s membership base in 2011.

While many development professionals who responded to DMW’s survey indicated that they’re curious about putting a higher price on basic membership, most are leery of making any change.

“This question of ‘Where is our base rate?’ comes up all the time,” said Tom Hurley, senior advisor with DMW. The survey found wide variation among stations: some don’t attach a price to their basic membership; others charge $75. Whenever stations set a basic membership rate, he said, they prefer to maintain it at the same level.

The rationale for setting a low basic membership rate and sticking with it is this: Once a viewer or listener joins at the basic level, development staff can work to move the member up the so-called “giving ladder.”

“There’s a lot to be lost if you tinker with that basic rate,” said Anne Ibach, membership director at Oregon Public Broadcasting, which offers a $35 basic membership and gives a $10 discount to seniors.  “What we’ve found is that the membership level here is just not a place for new revenue.”

Instead of attempting to increase revenue by raising the price of a basic membership, OPB sets its fundraising goals on convincing those who donate at the basic level to upgrade their memberships.

“You’re going to see more if you put your energy into upgrading,” Ibach said. “Our thinking is, ‘Let’s get them in the door and then figure out how to move them along the ladder after that,’ but it’s really a balancing act.”

Vermont Public Radio stopped offering basic memberships after shifting its focus to building its sustaining-membership program. These members pay small amounts on a monthly or quarterly basis by authorizing the charges to their credit cards. The average sustainer contributes $100 to VPR in a year, far more than the $35 basic membership VPR used to offer, according to Robin Turnau, president.

“We have changed our whole thinking about membership in general,” Turnau said. “We don’t have a basic membership rate anymore. . . . Now we focus on sustaining memberships — and it’s been a huge success for us.”

About 34 percent of VPR’s 26,000 members contribute through the sustaining-gift program, Turnau said. This fiscal year, VPR’s goal is to increase sustainers to 40 percent of its total membership.

The no-minimum strategy is working for VPR. During its fall pledge drive, 975 listeners became new sustaining members, boosting the station over its $500,000 fundraising goal by $16,000.

The growth of VPR’s sustainer program has reduced pressure on the state network to raise money through on-air fundraising, Turnau said. VPR earned, on average, $120,000 a month in new revenue from sustainers in fiscal 2012, allowing it to set lower goals for pledge drives than the previous year and pushing its total membership revenues over $4 million for the first time.

Georgia Public Broadcasting launched its sustaining-membership program two years ago but continues to offer $35 “starter” memberships; seniors, teachers and members of the armed forces receive a $10 discount. “We think it’s at a level that allows anyone to become a member and, at this point in time, we feel it’s comfortable for our marketplace,” said Yvette Cook, v.p. of development at GPB.

Average gifts of GPB members exceed the basic rate — TV memberships average about $70, and the average contribution of radio listeners is nearly $98.

GPB’s sustaining-membership program is growing rapidly: The number of sustaining contributors doubled during the station’s summer and fall drives. The two most popular giving levels for sustaining GPB members are $60 or $120 annually, spread over 12 months.

Pubcasters’ increased focus on sustaining memberships was reflected in the DMW survey, Hurley said, and it was obvious in the “State of the System” presentation at PMDMC. In 2011, sustainer fundraising outpaced other techniques, bringing in the highest average-gift amount and the biggest increase from the 2010 average. Sustainer gifts averaged $151, up by $5. On-air-air gifts had the second-highest average at $114, but remained $8 below their 2008 peak; the average direct-mail gift increased $95 in 2011, a $4 boost from the previous year.