Latest Thinking

Club Karma

The drivers of consumer happiness and loyalty have changed. Famed economist, Milton Friedman, once said, “a corporation’s responsibility is to make as much money for the stockholders as possible.” These days, a profit above all mentality will leave a business’s earnings in the red.

What are your club’s values?

Can you explain to a member why these are your club’s values?

Your club’s values likely center around the same goals: The Member Experience, along with maintaining and growing membership. Clubs exist to service the needs and interests of members. If members are happy, they are loyal, and revenue flows into the club.

The drivers of consumer happiness and loyalty have changed. Famed economist, Milton Friedman, once said, “a corporation’s responsibility is to make as much money for the stockholders as possible.” These days, a profit above all mentality will leave a business’s earnings in the red. Rather, today’s cycle of attaining and maintaining consumers centers on three things: Demonstrating values, building trust, and obtaining loyalty.

With this in mind, could a focus on karma—the idea that actions today lead to tomorrow’s fate—ensure that clubs better serve, maintain and grow their membership? In business, this is commonly referred to as Corporate Social Responsibility, defined broadly as, “a corporation’s initiatives to assess and take responsibility for the company’s effects on environmental and social wellbeing,” Corporate social responsibility (CSR) has many touch points. From ensuring that products are ethically produced in an environmentally friendly manner to engaging with the community in philanthropic and meaningful ways, companies are expanding their reach beyond the focus of profits.

Why?

The 21st century consumer desires more from the brands they make purchases from than a linear focus on profit production. Rather, consumers want to make an impact with their buying power by supporting brands whose values mirror their own.  

Today, millennials represent American’s largest generation. With $2.45 trillion in buying power, 70-percent will spend more on products and services from brands that support causes relevant to them. Beyond this, 81-percent of millennials expect corporate social responsibility, regardless of what they’re paying for a brand’s goods or services.

Millennials have led the shift in focus toward corporate social responsibility but, 90-percent of all consumers “expect companies to do more than make a profit, but also operate responsibility to address social and environmental issues.” A focus on corporate social responsibility can positively impact a business’s bottom line, as across all age demographics, more than half of consumers will pay more for services and products committed to corporate social responsibility.

In creating an authentic corporate social responsibility strategy, clubs must focus on agendas that are relevant to their offerings and members. For example, endeavors to cut down on water usage and recycle across the club would be well perceived by members.

Beyond that, clubs must be positive members of their communities. Supporting local schools and nonprofits by hosting events or supplying food, providing giveaways and lending support in public relations campaigns demonstrates the club’s commitment as an invested community partner.

It’s critical that clubs are transparent and authentic with corporate social responsibility strategies, as honesty and transparency rank in the top-three values adult consumers desire from brands. Unsurprisingly, a separate study found that millennials list trustworthiness as the most important brand attribute.

The benefit to clubs in investing in corporate social responsibility strategies is member loyalty. A 2016 Transparency ROI Study by Label Insight found that 94-percent of consumers will be loyal to transparent brands.

The good karma that comes from clubs investing in corporate social responsibility is in member engagement. A 2015 report by Nielsen found that sales for brands with a corporate social responsibility strategy rose 4-percent, versus the one-percent rise for those without such strategies.

What corporate social responsibility strategy can your club adopt today to begin building this good karma?