retention
series
ASI
.COM/LAJOSREP
T
O
OCKPHO
THE
BOTTOM LINE
In the third part of his series, Melvyn Hillsdon outlines
the black line meets it – in this case,
ways to estimate the financial benefit of improved retention
73.45 per cent of members retain their
membership for at least six months. We
I
n the two previous parts to the methods used to measure retention can also estimate the average length of
this series, we’ve looked at the described in part one of this series. As membership (the median value). To do
different ways of measuring a reminder, the best way to report this, we locate the 50 per cent point
retention and attrition, and at how retention is graphically, as shown in (the median point) on the vertical axis
to use these measures to develop and Figure 1 (below). From Figure 1, we and read across horizontally to the
evaluate interventions. In this final part, can determine the retention rate for point where the red line meets the
we will focus on the different methods any given period up to 12 months after black retention line, then read off the
that can be used to estimate the financial joining. For example, the six-month corresponding value on the horizontal
benefit of improved retention. retention rate can be taken from the red axis (months since joining). We can see
All estimates of the fi nancial impact of vertical line reading up from six months that, on average, members retain their
changes in retention are an extension of to the point on the retention line where membership for 12 months.
1
Retention rates
2
Estimated income
from members
3
Estimated income –
comparing the two clubs
0 1 2 3 4 5 6 7 8 9 10 11 12
100 £35k £35k
90
£30k £30k
80
total income
73.45
b
e
r
s
club B: £302,724
70
6 month n
t
h
£25k
n
t
h
£25k
e
m
o o
60
retention rate
£20k £20k
t
i
l
l m
50.43 e
r m
e
r m
50
n s e p e p
o
r
t
i
40
m £15k m £15k
c
o
c
o total income
p
o
o
30
i
n
i
n
club A: £257,934
£10k £10k
p
r
20 median length
£5k £5k
10
of membership
0 £0 £0
0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12 0 1 2 3 4 5 6 7 8 9 10 11 12
months since joining months since joining months since joining