I recently attended an industry convention and was touring the exhibitor’s hall and listened to several speaker sessions. While there was the typical focus on showcasing new products, sales and retention, and new concepts like big data analytics and business intelligence, what was most interesting and surprising was the absence of the word “experience”. This is very puzzling based on the fact we are immersed in the Experience Era. In today’s Club world it’s not just about who has the nicest clubhouse, best golf course or an outstanding chef it’s all about delivering an exceptional experience to each and every member every time they visit the club.
What are industry guru’s saying……
“Life is about creating and living experiences that are worth sharing. Get closer than ever to your customers. So close that you tell them what they need well before they realize it themselves.” – Steve Jobs
“We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.” – Jeff Bezos
“I think it’s very important to have a feedback loop, where you’re constantly thinking about what you’ve done and how you could be doing it better.” – Elon Musk
What do they know… “It’s all about the experience”
Industry pioneers like Amazon, Apple, One and Only Resorts, Southwest Airlines and many others are reaping the rewards of the Experience Era with unprecedented customer loyalty and positive word of mouth. They understand the fundamental connection between the experiences they deliver, customer retention, share of wallet, and positive word-of-mouth or simply stated -– happier customers stay longer, spend more and tell others.
They understand the key to improving experiences, is listening to your existing customers voice and utilizing that information to personalize and create new and better experiences.
What does the data show… “It’s all about the experience”
Research shows two important pieces:
First: Members will pay more… 86% of consumers are willing to pay more for a better experience (up to 25% more!). Everyone desires to have lifetime members and the associated value that represents.
Second: Retention rates are tied to experiences… Members will stay longer. Data also shows the most critical period for retention is a members first two years. It just so happens it’s also the best time to exceed their expectations by knowing them, listening to them and creating experiences tailored to them and their family. All of this creates what I like to refer to as club ambassadors.
For example, if we can improve our retention rate from 92% (which is the industry average) to 95%, at a club with 400 members. That 3% increase equates to 12 additional members per year. Over 5 years, this generates revenue of a whopping $1.68M (assumes $10K spend per year per member retained). Even if it’s less than half of that…. who wouldn’t want another $800K to spend on capital improvements, performance compensation for staff, member appreciation & celebrations, or investing in and creating new member experiences.
The Experience Era is ushering in a whole new set of challenges and opportunities. Which type of club do you want to be?
- A progressive club who is actively listening to your members voice and utilizing that information to continuously improve member experiences and creating an army of ambassadors OR
- A less progressive club who are pre-occupied with signing up new members (those in the bush).
Sometimes old clichés like a bird in the hand can be worth a million dollars!