In the days before MapQuest and Google Maps, the first stop you’d make when planning a long road trip was often your local AAA office. There — if you were a member — you could get directions, maps, listings of hotels and attractions, and information on discounts at some of the places you were headed. And, of course, if you got stuck somewhere along the way, AAA would give you the tow, jump or gas you needed to be on your way.
And today, even with the the popularity of digital maps (and the prevalence of insurance companies and car manufacturers providing roadside assistance), AAA’s membership base remains strong with about 53 million U.S. members, up about 50% from ten years ago. Each member pays about $60 annually, allowing the organization to more or less “own” the market when it comes to automotive travel membership.
Meanwhile, AARP “owns” the market on membership for senior citizens, and countless other organizations have a similar lock on their own niche areas — charging yearly dues and providing value through discounts and services. But, so far, I don’t think anyone has really nailed a local membership model, and there are two organizations that have great potential to dominate in this area — local newspapers and the YMCA.
Before we get into their opportunity, though, let’s talk about what I mean by “local membership.”
What makes the AAA model so successful is that they offer a core service (roadside assistance) with other perks. Some people pay for the core service but stay around for the perks — a couple of hotel and restaurant discounts and the membership essentially pays for itself. And a timely towing when stranded might inspire someone to hold onto their membership for decades.
On a local level, families always have products or services they need, and information is one of them. “What to do this weekend? What daycare to use? Are there safety concerns in my neighborhood? What neighborhood should we move to? What summer camps are available for my child?” From a product standpoint they need those home services, day cares or events to attend.
Many families will pay $100-200 annually to join their local science center or zoo so that they know that on any given weekend that can have something to do. That’s a lot of money, but after a couple of visits the membership dues pay for themselves. Getting someone to say just that “it pays for itself” is the key to any successful membership program. Discounts are another key part to a local membership program — but maybe more important are included services. This could be anything from oil changes and home warranties to monthly flowers or free lattes at the local coffee shop.
Newspapers are well positioned to start these kinds of programs. They have great brands that are well-known in their communities, they already have a membership base in the form of subscribers, and they have strong relationships with local businesses and organizations.
We’ve seen newspapers launch “perk” programs to complement their subscriptions — but this isn’t enough. A membership organization actively understands the needs of its core members and provides an array of products and services targeted to them. It’s also important to separate a membership program like this from a print subscription. The membership should be valuable enough that you don’t give it away to all newspaper subscribers for free — but instead is packaged as part of a larger offering with additional fees.
The other organization that could jump in on the local membership program would be the YMCA. Ys have a huge membership base of over 20 million members, and the local branches already understand that people join for one reason (say a gym to work out in) but stay for other reasons (e.g. programing or childcare). Having a variety of services packaged under one product is key to their success. The only thing they really haven’t done much is to branch out to work with other businesses and local organizations to make them part of the membership.
Most YMCAs haven’t done this because they don’t need to — they have strong memberships in their community because they offer valuable services. Meanwhile, newspapers used to have a service that was in demand; but as that demand decreases, it’s becoming increasingly important that they diversify their revenue streams.
Newspapers could potentially find more revenue in membership programs than from the SMB marketing services that many are jumping into. Instead of trying to get more revenue out of local businesses, it’s possible that newspapers could do better if they look to their core audience — families in the community — and offer new products and services that they need.
Matt Sokoloff is a 2012-2013 Reynolds Journalism Institute fellow working on a project to help local independent websites and bloggers gain additional revenue opportunities. His background is in building digital products for media organizations. Read more about his current work here and respond in the comments or to firstname.lastname@example.org or @MattSokoloff on Twitter.