To Discount or Not to Discount, That Is the Question

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11/27/2020


Over the years, I have discounted memberships depending upon the association and their flexibility as I sold on their behalf. Typically, the discount is provided as an incentive for a new member who is unfamiliar with the association. In the last year, because of financial impacts of COVID-19, I have heard more associations than ever before talking about discounting memberships during the renewal process, afraid that they will lose all of their revenue – and them as a member – if they do not reduce their dues.
When reducing dues, I have to offer the following advice, one that was a hard-learned lesson – the timing of the discount is everything. Offering a reduction in dues needs to come as the last step in the sales process. “If we can provide you X% discount, will you join?” Often, prospects will push the pricing conversation to the beginning of the sales process. They see the number and believe it is too high, particularly without knowing or understanding the value of the membership first.
Recently, I ran into this with a large prospect. Every indication they gave was that they wanted to join.  They asked for a discount for their first-year dues, which we quickly provided. Then radio silence. I followed up for several weeks without hearing anything. If a discount was what they needed to join, they would have given us the yes immediately – but they didn’t. Why ask for the discount? I don’t know.  This was my lesson learned. If I explicitly asked, “If I can provide you that discount, will you join?” Then it becomes an informal agreement.
My recommendation to sales professionals is to push the price conversation to a few steps down the line. Communicate the value of membership first and discuss the actual investment after they agree that participation in the association would be helpful to their business. Then, have the price conversation and offer the discount as the last step. Similarly, when renewing members, I would not offer discounts off the bat. Have individual conversations with those who are not renewing, understand their position, and if they even want to rejoin. Then offer the quid pro quo of a discount. This will save time and save lost revenue.
 
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About the Author

Elizabeth Johnson

Elizabeth H. Johnson, a member of Big Red M team since its inception in 2010, has led highly successful membership and sponsorship campaigns throughout her tenure for some of the top associations in the country.
 She specializes in conducting a comprehensive review of existing sponsorship programs and developing fresh opportunities for increased revenue. Her association expertise also includes her ability to articulate government relations as a key membership benefit and to deliver presentations to leadership and boards across industries.
 Prior to Big Red M, Elizabeth worked within the association segment of Marriott’s prestigious global sales team. She is a graduate of James Madison University.

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