Thursday, October 13, 2011

What can skatepark membership privileges look like?

When most skateparks open they ask their patrons to chose between being a member or non-member.  Why?  One idea would be to have no memberships.  What do you really need a membership for?  The skater doesn't need it if he/she can pay a few dollars more and still enter.  So why would a membership be attractive?  Often we see that memberships are like sales coupons: member price = less.  In grocery stores they have memberships and can track your buying and funnel products at you based on deals they get from suppliers.  At REI your membership means you get a yearly dividend as an "owner".  In skateparks often we see that members have a lower price on entrances and other services, much like a warehouse buying service.  You pay once a year and you can then pay less for things you want.  Sometimes this includes membership prices on goods and services like shirts and camps.  You don't have to buy a membership but if you are thrifty and come often enough you can save a lot of money.  Many people don't think along these lines of future savings.  They want the savings now.  If your membership is pricey, then you will have to really want to support your park, or your park must be extremely expensive.  So what can skateparks do to make memberships that are costly attractive to the potential patron?  What would be a reasonable goal for these memberships.  Lets look at scenarios to see costs, and returns.

Most would think a $25 membership is affordable.  So if you are going budget capable membership, what would you offer with this to make it worth your wile to offer it at this price?  If you said you get to skate this time and next time for free for example, and your sessions for members costs $12, you would be able to sell this as an affordable way for them to be here.  You could give them a get in free pass with the idea being they could use it on the next visit.  This would be a good selling point and could move quite a few of these per year.  If you have an i.d. the cost of this would have to be taken out as would taxes, so you would in all likelihood take in $22.50 of this.  If you sell 1000 over the course of the year this would generate $22,500.  If the membership was not offered and these 1000 people came in at $15 for 2 sessions you could generate about $30,000 less tax and no member card costs.  While we can you don't have to offer a free session, the bottom line is effected.  What does the membership add to your revenue flow at this cost.  The membership is a good tool for gaging the loyalty of your patrons.  You have a way of identifying with the park as you are a card carrying member.  You get special letters in the mail and maybe specials every month.  But are these enough to justify losing $7500 in revenue?  Maybe not at $25.  The problem of price point is very tricky.  Figuring out what you need to offer as an incentive is hard to figure and something that you can survey your current members and your current partons about.  This could help you get a handle on how much to charge for a membership.

I would suggest that memberships should be special and they should cost a substantial amount of money.  I suggest you price your membership at $150 or more but offer a lot for this.  What days can you give them for free?  How much can you offer them for use of the place?  How many member events can you generate?  This will depend on how your patrons see your place.  What if you were able to get 1000 people to buy in at this level?  Could you make your rent on $150,000 and have members enter free everyday?  Why would they see this as value if every time they come the place is filled with nonmembers and the place is crowded?  Could you make it free of others most of the time?  Obviously the busiest 2 days are Friday and Saturday, with Sunday the next busiest.  What if you had Sundays through Thursdays as member only and free?  Does this now make $150 (or more depending on your size) worth it?  Add in sales of stuff, 2 busy open days, special events, and you might have a good plan here.  The membership now has meaning, this is their park, they paid for it.  They have now the identity of a park member and you can really look to them for support, hype, and pride.  Obviously, looking at your pricing is a good idea, but one that needs a lot of thought.  I recommend you study this and see if it would work.  Once you set your price, set your goal and get all your staff on-board selling this.  Set sales goals, offer prizes, put out promos. Good luck.  Go skate.