One of the obsessions of the coworking and flexible workspace industry, or at least of quite a few operators I have come into contact with over the years, has been to get lots of leads. This is not a bad thing, but I was always surprised that there was not the same focus on improving member retention.
A high retention rate means not only that you get more bang for your marketing buck (as those users will stay at your space for longer and therefore their customer lifetime value will be higher) but also that you need fewer leads for the space to have high occupancy levels. Think of it like a boat with several holes in the hull in which you have a team working to bail out the water but no one working to plug the holes.
The more you can increase member retention, the fewer leads you will need, plain and simple.
This attitude in a growing market makes some sense. It's not something I like but I can understand it: I replace clients at x rate with clients who will pay me a higher rate. However, unless you have done something you shouldn't do such as offering a rate that contractually cannot be increased (a practice that was not uncommon a few years ago for some coworking operators) I think it is much better to progressively increase member rates and maximise tenure. This allows the leads you gain to be spent on increasing occupancy levels or expanding, rather than replacing avoidable churn.
Through Flexspace Observatory, Nexudus is creating reports in which we focus on observing the permanence of members in order to help workspaces to maximise the amount of time members stay with your workspace and help you to improve the management of your space.
Flexspace Observatory’s most recent report focuses on the evolution and behaviour of the different member profiles in terms of permanence. It analyses how the type of tariff a member is on affects permanence, as well as their age and whether or not they belong to a team.
In a follow-up report which will be coming to Flexspace Observatory soon, we will look at how you can increase tenure in a more direct way. We can ascertain this by looking at what characteristics or behaviours of members indicate to us that they are likely to have higher tenure.
With the information from these reports, you will be able to better target types of members who are most likely to offer you long tenure lengths. This will give you a clearer idea of how to segment that audience thanks to the information these reports will provide.
It will also help you to learn more about what aspects of space use can give you clues about which members will have higher retention. But we don't stop there. We also try to give you clues on how we can help you increase member retention.
Obviously, all flexible workspaces are not created equal, and the situation will vary between different countries, cities and particular spaces. There is one factor, however, such as the size of the space that largely determines the character of the space and allows us to give you a deeper insight into what is happening in your space.
For this reason, all the topics in this series will have two parts, one that will be published on Flexspace Observatory and the second that you will be able to download and that will be customised according to the size of your space.
To leave you with a taster of some of the insights you can expect to gain from the reports, I can tell you that between 2016 and 2021 average member tenure in workspaces across the industry increased by 42%. To learn more you will have to click here!
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