Lately, you may have noticed a radical increase in the amount of membership and subscription-based businesses that are out there. I’ve been hearing from a lot of you that they seem to be popping up everywhere and for some very good reasons!
Membership and Subscription businesses are…
- Convenient to customers or clients because they get that ongoing need or desire for problem-solving. The customers get the support they need month after month.
- Cost-Effective for the consumer (aka the customer of client). And they usually have some kind of community element to them. Let’s face it, at a time like now when we can’t really be physical in communities, online communities are becoming more and more important.
- Able to Create Stability for you, the business owner. Stability in terms of recurring revenue and being able to predict what you’re going to be making in your business, month after month.
That is a huge game-changer! Don’t you think?
As someone who has a membership, I’m able to predict different outgoing costs in terms of my business. I’m also able to look up when is the best time to increase hours for the people and contractors that I have on my team.
Before COVID-19 happened, there were people with brick-and-mortar businesses that had a membership element to them. They were able to predict how many staff members they needed to have on the floor at any given time. It’s because of the recurring revenue and stability of the membership that they were able to predict this.
What I’ve mentioned above are only some of the benefits from having a membership or subscription, and there are loads more!
Today, on the Mums With Hustle Podcast, I’m going to be answering your most pressing membership and subscription questions.
Recently, I put a post in my private Facebook group asking women in business to submit their questions about memberships and adding a recurring revenue stream to their business.
From that post, I’ve selected a few of those questions to answer right here on the podcast.
If you did submit a question, thank you so much! I’ve actually pooled all of those together, and I’m gonna be answering more of those questions in the next week or so.
This month on the Mums With Hustle Podcast has been so cool as it’s all about memberships and subscriptions. We’ve been focusing on serving you with the best and most inspiring education to get a clear idea on what a recurring revenue stream could do for you, your family, and your business.
If you take anything from this month’s podcasts, I hope it’s this:
EVERY. SINGLE. BUSINESS. CAN. HAVE. A. REVENUE. STREAM.
RELATED MEMBERSHIP PODCAST EPISODES
Just a recap on the past few episodes before this…
A few weeks ago, in Episode 226, I introduced you to Jessica Donovan. She’s a member of my Freedom Filled® Mastermind and she has a membership. You can listen to her episode here >>>
Then on Episode 227, I walked you through the 4 different types of memberships. And I asked you to pick one that speaks to you. If you haven’t listened to that one yet, after this episode, circle back and binge listen. You will discover which among the membership types suits you the best. Listen to that episode here >>>
Last week, on Episode 228, I was joined in the episode by Liv Morgan. If you have a product and you’re wondering how a membership or subscription can help you sell your products, my gosh, girlfriend! How could it not work? Give that episode a listen here >>>
Jessica, Liv and I all learned about memberships from the same guy, the same mentor, Stu McLaren.
Alright, let’s dive into answering some of your questions about membership!
QUESTION 1: Would a 2-month membership be too short? What is the shortest membership?
Answer: This is such a great question because memberships are very different to causes. Memberships are ongoing… Meaning you’re fulfilling an ongoing need, an ongoing desire or offering ongoing support. People can stay as long as they want with a membership!
Think of memberships like a gym… You join a gym and you want to be there for a few months. So you would join as a monthly member and cancel when it no longer serves you. If you need to take a break, you leave and maybe join again at a later time. That’s the awesome nature of a membership model.
In saying that, I have seen many memberships, particularly product-based memberships, where you can offer a 3-month, 6-month, 9-month or a 12-month subscription. People can also opt to join as a monthly member and stay from month to month.
When you bundle your membership in months or annual, it’s usually more cost-effective for your customers.
Inside of my membership, the Social Method Society, I teach women how to market and get more business using Instagram. That membership is $67 per month and ladies can choose to join as a monthly member. Every month, the amount is directly debited from their accounts on the same day each month, on a recurring basis until they decide to leave.
Or they can actually save themselves quite a substantial amount of money and they can join for 12 months up front. We offer an annual option because chances are our ladies want to be in business for more than 12 months and they’re going to need online marketing support and a collaborative community around them for more than just a month.
A lot of women have joined the Society for 12 months up front and for them, it has been $670 for the entire year. They actually scored 2 months for free. It’s waaaaay more cost-effective!
There are so many different ways to price and package your membership offer.
Question 2: Talk to me about retention rates, how much of a drop-off in enrolments should I allow when I’m planning out potential income?
Answer: Wow! This is such a boss question to ask! I love it so much. Sometimes people can get so focused in bringing in new members that they forget about the importance of serving the members that they have at the moment. When you really go all in serving your current members, you’re going to find that you improve your retention rates.
That’s one tip right there…
This is why I love not always having your membership open. I’m gonna talk about that later as well, because that ties a lot into retention. But if you can focus your efforts on serving your members and giving them a great experience, that is the best thing you can do to help your retention.
Yes, people will leave. I know that there are some people who want to have an average of what to expect in a membership. But it varies from niche to niche and membership to membership. The best thing to compare yourself to is your own retention rate!
So when you launch your membership, you really do need to have it open (almost for a full year) to be able to see patterns and trends so you can start predicting. As you improve your membership, improve your on-boarding sequence and as you get coming along, you’ll be able to say, “Hang on, this has drastically improved our retention rate.”
My biggest tip for retention is to compare yourself only to yourself.
There’s a simple but very important element to any membership, which is the Success Path. If you’re in the Social Method Society, I also have a Success Path that my members work through. It’s what gets people to buy, hooks them to join and keeps them staying month after month. It keeps them on their journey to where they are headed.
Question 3: Is there a right time to offer a membership?
Answer: When you have a traffic source, such as Instagram, it’s a warm traffic source. Keep building that and you can launch anytime.
Lots of people hold off from launching their membership because they feel like they don’t have an audience… But you don’t always need an audience of your own to start with!
So yes, having your own traffic source is amazing… But there are other ways to get the right traffic over to your membership offer. You can launch way sooner than you think.
Question 4: Which is better… Having an open or closed membership model? And how do you avoid the feeling like you’re selling all the time?
Answer: These are both great questions and this came up quite a bit from questions that were submitted. It ties strongly to the retention question earlier because people will stay longer if they know that when they leave, they leave. If they want to come back they’re going to wait for months.
Sometimes customers may wait for several months as there are memberships that only launch once a year. So closing your membership is one way to improve retention!
When you close your membership, you are able to focus on serving your members better. Because your attention is not split and does not have to be shared with constant promotions and constant selling. You get to focus on serving your members instead!
And when you do that, you’ll get to see your retention rates increased. When I talk about retention, I mean, the number of people who are staying in your membership versus the number of people that are leaving.
On the other hand, when you have an open membership all the time… You have to constantly promote. It takes away your attention and your resources and it can impact retention.
Question 5: When moving to a subscription model, should we stop selling our individual offers or should we add a subscription box offer on top of our current offers?
Answer: Maybe you can start with adding a subscription box, but it’s totally up to you. Consider starting with adding it in first and see what happens!
Answer this question to guide you, “What is the benefit of someone becoming a member?” If they can go to your online store and buy stuff anyway, there’s nothing wrong with that. But you need to ask yourself if other products remain there, what is the benefit of someone subscribing and becoming a member and getting your products month after month?
The benefit could be the price.
Maybe your members can get better pricing because they’re getting things month after month instead of being a one-time customer. Or maybe they get access to exclusive VIP designs or collections that don’t go up in the website for everybody else? Or you can also add personalization to products like putting their names in monograms.
WRAP UP
Ladies, that’s it! Thank you so much for joining me for this episode, my love. If you enjoyed it, remember that there are several episodes before this one that are related to memberships and subscriptions. Those other episodes will help clarify if a membership or subscription model is something that you could and should be doing.
Of course, I think that you can and should explore a membership or subscription offer! If you’re thinking about it, the thought is there for a reason.
Go with it.
Until I see you again on the podcast, big virtual hugs to you. I hope you’re doing well, and I hope you’re staying safe!
We may be going through some pretty tough times, but that does not have to mean that you give up working towards achieving your dream life for your family. No matter what that looks like for you. Never let go of that.
I’ll see you here next week in the podcast. Stay happy in your hustle!
Work with Tracy