Virtually every membership organization has some level of online activity. However, many are missing huge opportunities to engage fully online. Through technology, organizations can extend benefits beyond the limitations of face-to-face contact. It is possible to create new opportunities while lowering costs for members. Moving from offline to online actually requires a change in attitude though. Some organizations with an online presence haven’t fully moved to an online mindset. It’s not something you do once. It’s a different way to think about engaging with members.

The companies discussed in this chapter—Weight Watchers, News Corp, and the Field Museum—were already online before they launched their online initiatives. However, these companies hadn’t yet fully incorporated the online experience into their business model.

The transition of extending an existing membership from just offline to online is tricky. Often, offline benefits don’t translate well online. Also, members might not want to move online. Ideally, organizations make the transition gradually and provide lots of choices along the way. The online experience may look totally different from the way the offline one did, and in fact may attract new target segments. As with any major transition, planning for constant tinkering, especially in the early days, is critical. The one thing most companies that have moved from offline to online agree on is that things didn’t go as smoothly as expected. So budgeting time and money for unexpected challenges is important. Despite the challenges of making this transition, it is one that nearly every offline Membership Economy organization has had to grapple with or is working through now. Any organization that does not provide a meaningful online experience (not just an online presence) is at a major disadvantage. Figuring out how to harness the myriad technological advances of the past few years can lead to tremendous new opportunities—and not figuring the transition out means almost certain failure.

Enticing or requiring subscribers to change their behaviors can require tough choices. Organizations making these transitions risk losing members when they jettison legacy services and systems too quickly or require too much change at once. Nevertheless, it’s possible to make the transition with grace and ultimately to turn the online offer into an engine for growth, as Weight Watchers and News Corp demonstrate.

Weight Watchers: Adding the Cloud to the Storefront

Weight Watchers is one of the best examples of a successful membership organization that has continually evolved to meet its members’ needs, including making the transition from a traditional membership business model to an online one. The company is driven by a simple, unchanging mission: to help people reach and maintain a healthy weight. In the 1960s, my grandfather was one of its first (he always said the first) male meeting leaders—as part of the company’s fledgling efforts to become relevant to men as well as women. Nearly 40 years later, I joined a very different Weight Watchers to get healthy after my daughter was born in 2001. Weight Watchers continues to evolve.

Today, Weight Watchers is clearly the dominant company among weight loss centers and programs, banking north of $1.5 billion each year.¹ It is at least three times larger than its primary competitors, Nutrisystem and Jenny Craig. Weight Watchers has about 8 million website visitors per month and 1.72 million paid online subscribers.²

Weight Watchers has always used a membership model, requiring ongoing subscription-like payments and emphasizing community. Members who successfully lose weight are invited to become lifetime (free) members and sometimes are recruited to lead their own weight loss meetings. Weight Watchers has continued to innovate. Through its expansion to an online membership model, it has been able to dramatically reinvent the way it serves its members.

Dave Kirchhoff, the former CEO, told me that he is a lifetime member of Weight Watchers and has been at his goal weight since 2009. He wrote about this side benefit of his 13 years with the company in his book Weight Loss Boss, How to Finally Win at Losing—and Take Charge in an Out-of-Control Food World (Rodale Books, 2012). In January 2000, when Weight Watchers recruited Kirchhoff from PepsiCo where he worked in the corporate strategy group helping the Tropicana business, the intellectual challenge of taking one of the world’s most successful membership communities online appealed to him. He knew he faced several major challenges:

    Awareness. No one knew Weight Watchers had an online presence.

    Pricing. Ad-supported or subscription?

    Offering. Online/offline hybrid or online only?

The company decided on a subscription model, despite the pressure to offer an experience that was fully ad-supported. Kirchhoff recalls the decision being difficult, since all the other weight loss companies seemed to be signing up to do free ad-supported deals with Yahoo! and the other portals. “My view was if our product actually helps people achieve this difficult-to-achieve goal, why should it be ad supported? Why should some random pharmacy or food company sponsor your weight loss? Besides, you need to have skin in the game.”

It decided to offer a choice to members—online, offline, or a hybrid. To its surprise, in the early days, most people coming to the online site preferred the fully online solution or the offline-only solution—the hybrid solution didn’t take hold until later years.

With a lot of testing and a little bit of luck, Weight Watchers built a model that took off. Kirchhoff said he knew within two months that it had a winner. It surveyed users constantly, using traditional consumer product metrics, to determine if they felt their product exceeded expectations, was worth the money, and was something they would recommend. For the first few years, the company would spend 90 cents of every dollar earned on product development—effectively betting the whole business on continuous innovation to improve the quality of the online experience.

The driving product development philosophy was to build tools and features that were based on observed member behaviors. The people on the team watched what members were doing on their own and made it easier for them to do it. They started message boards, looked for microcommunities that formed, and created content and experiences for the most active of these microcommunities. They noticed that members were using other sites like Geocities to blog about their weight loss journeys, so Weight Watchers Online created its own blog function. What was interesting was that the features that were most valued by the online members were totally different from the features in the offline program. Most notably, the online program did not have a “meeting” model, the cornerstone of the traditional Weight Watchers program.

Kirchhoff encouraged product managers to become anthropologists. Too many product managers rely on instinct and gut instead of actual behavioral data—which is silly, especially in online communities when there’s so much data available to learn exactly what members care about. By keeping an open mind about how its “weekly meeting” and the rest of its traditional approach could be reimagined, even replaced, to enable online members to have the same great weight loss results, Weight Watchers was able to dramatically extend its reach.

Like Weight Watchers, News Corp had a strong brand and history and saw that it needed to think differently about the online extension of its offline brand.

News Corp: Focusing on What Digital Enables

In June 2014, Katie Vanneck-Smith, the chief marketing officer of News UK, was promoted to chief customer officer and global managing director of Dow Jones. No one was surprised at the promotion of the longtime News Corp employee. Vanneck-Smith had already led The Times, The Sunday Times, and The Sun’s marketing organizations into the digital era and transformed their direct relationship with readers through the development of Times+ and Sun+ membership and paywall offerings.³

Prior to Vanneck-Smith’s tenure as CMO, marketing had been a lower priority for the organization, as it is with most newspaper companies. The traditional wisdom is that circulation is the number that matters, composed of home delivery and newsstand sales. Circulation drives ad sales and prices, which have historically been their primary revenue source.

Vanneck-Smith was overseeing News Corp’s addition of a digital platform for news. Recognizing that once readers started getting their news online, their attitudes and expectations about pricing and value would change dramatically, she began rethinking the company’s offerings.

To create what was needed, she first strove to change the culture, if not of the whole company, at least of her team. She said, “We’ll need far more of a start-up mentality—more opportunism, more experimentation, more collaboration across our global businesses and the content we produce.”⁴

The company hired young marketers with expertise in social and digital promotion, invited key tech team members to sit in the marketing space, and blended the sales and marketing roles to focus more broadly on customer lifetime value.

Instead of thinking about circulation and advertising, she focused on creating bundles of content and value that were consistent with News Corp’s various brands. Some of these bundles were a mix of digital and print editions, while some included untraditional offerings—like a tablet device or a subscription to Spotify, the digital music service, with playlists created by the journalists to complement the reading experience. The whole organization also started to use the language of membership instead of subscription, emphasizing the emotional connection it has with its readers.

In addition, Vanneck-Smith sought unusual ways to connect with members. For example, once a new reader signs up, News UK—a British newspaper publisher and subsidiary of News Corp—sends the new member a customized personal invitation to meet with the editor.⁵ And it invited a few hundred Sun Times readers to a “cocktails and canapes” event which featured a war photographer—access to a very special experience for members.

The idea was that moving from offline to digital was about more than putting the newspaper online, but rather taking advantage of digital technology to extend the brand’s reach and value. Instead of thinking of the transition as a catch-up exercise, Vanneck-Smith thought of digital as an enabler for value and began to focus on the lifetime value of the customer instead of ad sales and circulation revenue.

The result of her efforts has been that readers seem willing to pay for the digital bundles, even after over a decade of free digital. As with Weight Watchers, News Corp made a conscious decision to charge for the value that it creates, focusing on delivering an ongoing experience worth paying for. While it is too early to measure the financial impact on the company, News Corp’s commitment to its digital transformation is a key part of its public vision for the future.

The transition from offline to online is not limited to corporations. Nonprofits need to figure out how to extend their reach and value through technology. One innovative example is the Field Museum—where major innovation came about as a result of a superuser’s brainstorm.

The Field Museum: Embracing a Member’s Creativity

Many museum directors and curators have mixed feelings about outreach and marketing to members. On the one hand, they know that without engagement from their communities, they have little reason to exist (and often no means to exist). On the other hand, sometimes it feels as if the business objectives are at odds with the organization’s mission.

The Field Museum of Natural History is a notable exception. Located in Chicago, the Field Museum is one of the largest natural history museums in the world, attracting over 2 million visitors annually. The institution has aggressively invested in technology to augment its century-old strategies for connecting with its audience.

In May 2013, the Field Museum announced a new partnership with Emily Glaslie. She is the creator of the YouTube channel “The Brain Scoop.” Emily had been hired as the Field’s “chief curiosity correspondent.” Now, every week or two, Emily posts a five- to ten-minute video about something cool at the museum. Usually, about 50,000 people watch it. Dozens, if not hundreds, of people post comments, mostly positive. Many follow up with further questions about the video. Talk about building awareness and engagement in your museum’s content!

This idea didn’t come from the Field Museum itself. A museum member contacted the museum staff members, letting them know about Emily’s program and suggesting that the museum do something similar. This kind of two-way communication between the organization and its members can lead to innovations, large and small.

On her blog, Brain Scoop with Emily Graslie,⁶ Emily described her new role as, “Better than going to an amusement park and not having to wait in lines. It’s better than meeting your favorite author and getting his autograph. It’s better than a first kiss. It’s better than cake and brownies.” The Field Museum is pretty thrilled too—attracting a notoriously underrepresented audience of girls ages 13 to 18, lots of media attention, and a new way to engage with fans around the world.

This new initiative did not represent a change in attitude or core relationship with members, but was a great example of constant tinkering and small experiments that have big potential.

What Can We Learn from This Model?

Members expect to be able to access their communities online. Period. If you’re not providing this access, someone else will. Asking members to change their behaviors can be tricky, so offering additional opportunities to engage rather than forcing change is the best way to go. And whether small changes, as with the Field Museum, or entire models of engagement, as with Weight Watchers Online, using a transition to online as a catalyst to provide new sources of benefit with an organization they belong to is appreciated.

Remember

    Be willing to change your approach in order to work online. You may need to completely change your approach to deliver the same benefits online.

    Focus first on the quality of the experience—if there’s value, people will pay.

    Innovate like an anthropologist. Watch what your members do, and adjust your approach.

    Encourage and listen to the input of members—they may have innovative ideas that you haven’t thought of.

    Measure everything that matters, starting with retention.