Three Surprise Costs That Make Members Quit

Understanding member retention strategies requires a deep look into the "danger zone" of the first year. Many organisations suffer from high club membership churn because new starters underestimate the total cost of hobbies, including gear maintenance and hidden event expenses. By creating a transparent member onboarding guide and offering flexible membership payments, such as monthly subscriptions, clubs can mitigate "sticker shock." Transitioning to tiered event pricing and being honest about the true cost of participation ensures members join with their eyes wide open, significantly reducing the likelihood of them quitting at their first renewal.

Did you know that members are over 60% more likely to quit after their first year of membership than in preceding years? In fact, one in four members quit after just one year. This means the first year of membership is the danger zone for your organisation, when losing members is most likely. 

New members often underestimate the total cost of starting a new hobby or joining an association. By the time they hit their first renewal date, they’ve looked at their bank statement and decided to cut their losses. So, today, let’s have a look at the reasons why members underestimate the price of membership, and what you can do to keep them around. 

1. Members Quitting Over Unexpected Start-Up Costs

The biggest reason members leave in their first year is often due to costs they didn’t expect. Taking on a new hobby can come with a lot of unexpected costs, and novices don’t always know to look out for these. 

Take James, who joins a social tennis club for $110 a year. He thinks all it will cost him is the $110 for membership, plus $5 to rent a racket occasionally.

Here is how that maths actually works out: 

• Hiring a racket at $5 twice a week adds up to over $500 a year. James quickly realises it would be much cheaper to just buy a racket. 
• James buys an intermediate racket for $200-$300.
• James now needs to restring his racket twice a year, which costs an extra $100 a year. 
• James’ normal sneakers are likely fine for a few months, but sooner or later, he will need to take the plunge and buy proper Tennis Shoes, which will be another $200. 
• Plus, if James is over 30, starting a new sport like tennis is also going to come with needing to buy a lot of painkillers, Voltaren and possibly arm braces. I started rock climbing at 28 and spent the first few weeks convinced that my arms and legs were going to shoot off my body in a fountain of gore. 

Suddenly, James’s original estimate of $110 has ballooned to over $600, plus likely the same again in pain relief. 

These extra expenses aren’t your fault, but it’s easy to see why a new member might decide that stepping back from their new hobby is better than spending all of that money. Often, a member will push through those costs in the first year, only to decide at renewal time to cut their losses and not return for a second. Either way, that’s a member lost. 

How You Can Help Prevent This 

My recommendation would be to do what I did above, but in more detail. Create a page on your website or a downloadable "New Starter Guide" that outlines the real-world costs of the hobby. 

In this guide, you can include things like: 

• The Gear Timeline: How soon do new members typically feel the need to move from rental equipment to their own gear?
• Tiers of Investment: Provide clear examples of "Starting," "Intermediate," and "Advanced" gear, with estimated price points and guidance on when to invest in each. 
• Maintenance & Upkeep: Don’t forget the maintenance and upkeep that needs to be factored into budgeting. 
• Pro-Tips for Saving: Share your insider knowledge on where to find the best deals or which expensive items aren't actually worth the hype.
• Ongoing Price of Hobby: The first year of a hobby, when you’re buying all the gear, is, in most cases, the most expensive one, as in subsequent years, it’s only maintenance and a few upgrades to spend money on. Lay out a roadmap of what members can expect to spend in subsequent years, so they know costs will decline.  

Yes, it might turn away a few people who realise they aren't ready for the financial commitment, but those are people who would have quit anyway. For everyone else, it helps them make an informed decision. It’s much better to have a member join with their eyes wide open than to have them join, then feel overwhelmed by costs, and quit three months later.

If you can wrangle it, it would be amazing to partner with a local store and offer members discounts if they buy their gear from there. 

2. Members Quitting Due To Unexpected Event Costs

Outside of the surprise costs of getting all the gear for their new hobby, one really big sticking point for members is the price associated with events. In part, this is ticket prices for events, but it is also the other costs that come with events. 

To reuse an example I really love, a few years ago I interviewed someone who ran a car club. He said that they did a lot of their club cruises to wineries, which sounds amazing; a Sunday cruise in a classic car through beautiful countryside, then lunch and some very nice wine to top it off. What's not to love? 

The issue is that lunch and wine at a winery aren’t cheap, and several of their members either didn’t attend these events or went very rarely because they just couldn’t afford to go more often. So the club in question started adding events where they would go on a cruise to little cafes by the ocean, and attendance numbers shot up. Lunch and a few glasses of wine at a winery restaurant is going to be easily North of $50 per person. You can get a coffee and a lamington for about $8.

Your membership may be affordable, and your event tickets themselves may be affordable, but all the other expensive people need to factor in to attend events may not be. 

It is also vital to factor in the non-direct costs, specifically the "time cost" of your calendar. For example, I live in a small coastal town and love kayaking, but the only local club meets every Thursday morning. Even though I have all the gear and the events themselves are free, I simply cannot afford to miss half a day of work every week. As a result, I’ve never joined. Your membership may be affordable, but if your schedule requires members to sacrifice their income to attend, many will decide they can't afford to belong.

How You Can Help Prevent This 

Take a long, hard look at your calendar and calculate what an event actually costs a member in reality. You need to factor in petrol for the journey, meal expenses, and if attending events is going to clash with people's work.

If your events are consistently expensive or scheduled at restrictive times, members already navigating the high costs of their first year will feel priced out or shut out of the community. By offering a mix of "premium" experiences and low-cost social catch-ups, scheduled across different times of the week, you ensure your club remains a sustainable hobby rather than an unsustainable luxury.

3. Members Quitting Due To Sticker Shock 

One reason members quit is that a big one-off bill can be daunting. All of a sudden, you have to try to find a spare $200 to pay for membership. If that big bill comes at the end of a year full of expensive events and new gear purchases, some people will just choose not to renew.

The solution is to do what so many companies do today, and allow members to pay off their membership over time.

Without looking it up, can you tell me exactly how much you spend each year on streaming services? Pick a number in your head right now.

The average person has about four active subscription services. Netflix is roughly $250 per year; Spotify is $200; Disney+ is another $200; and a Stan subscription costs $264, or $384 with the sports package. So, if you’re the average person, you’re paying, as near as makes no difference, $1,000 a year on streaming services. I know I certainly am.  

I don’t know about you, but it definitely doesn’t feel like that much to me. My estimate would have been well under $1,000. That’s because we don’t get a big bill once a year for all of our subscriptions; they slip out of our accounts in drips and drabs each month. If Netflix sent me a $250 bill once a year, I’d cancel it, but because it sends me $20 bills, it never seems like a big deal. 

My point is that subscription models have become so common because they are useful. Not only is it easier for the buyer to justify spending $20 a month on something than $240 a year, but it’s easier to find a smaller amount in your budget. Finding a spare couple of hundred dollars is always going to be a lot harder than finding $15. 

How You Can Help Prevent This

What you can do to take the sting out of renewal time is to offer a subscription option to your members. 

Now, there is a fair argument to be made that people are generally tired of everything being a subscription. I’m not suggesting you switch to a subscription-only model, but offering a monthly subscription option gives your members an easier, more affordable option.  

If you use Member Jungle, you can set up ongoing subscription options so members can pay monthly, quarterly, biannually, or annually. This allows them to choose the pace that fits their budget. My recommendation is to offer them multiple options so they can choose the one that works best for them. It is also common to make the annual option slightly cheaper than the monthly subscription to encourage those who don’t need the budget-friendly monthly option to continue paying up front. 

An alternative option if you don’t want to do the subscription model, or can’t because you are a ports club and need the money up front, is to use Afterpay. AfterPay offers an 8-week payment plan and is built into the Stripe payment gateway. Instead of paying immediately with their card, your members can check out using Afterpay, which splits the payment into 4 fortnightly payments. While you still get all the money upfront. For more information on how Afterpay works and how to use it with your system, check out How Afterpay Can Help Your Club Survive These Trying Times.

Protecting Your Club’s Future

The first year of membership will always be a period of high friction. Between buying the gear, finding the time, and adjusting to a new budget, your new members are doing a lot of heavy lifting just to be part of your community.

While you can’t buy James his tennis shoes or pay for every member's winery lunch, you can ensure that the financial surprise is taken out of the equation. By being transparent about startup costs, diversifying your social calendar, and offering flexible payment options, you move the focus away from the price tag and back to the value of your club.

If you want to find out some great ways to help your new members feel comfortable, have a look at 4 Ways To Welcome New Members To Your Club. 

If you want to go a step further and build a real strong sense of community and belonging in your organisation, check out 5 Ways To Build A Sense Of Belonging In Your Club Or Association.