How to Grow Your Business with Recurring Revenue

Are you tired of stressing about how to grow your business revenue? It’s hard because oftentimes we think if we want to earn more, we have to work more… but there are only so many hours in a day, and frankly, I don’t want to work all of them! (I want to go to the beach).

I’ve been there. You’re sitting down at the beginning of the month, looking at your upcoming bills and trying to do the math to figure out how many clients you need to book just to break even, nevermind actually put some money in that savings account that’s been giving you the side eye. It’s one more thing to manage, and honestly, not something anyone warned you about in running a business!

My little secret (that is not a secret) is that I’ve been using a membership model to grow my revenue for the past 4 years and it’s been amazing. Like the tides of the waves, each month, money comes in on a regular, predictable schedule. (I really want to go to the beach).

So what is a membership model?

It's a way of offering your products or services to customers on a recurring basis, rather than a one-time purchase. Imagine knowing exactly how much money is going to be dumped into your business account on the first of every month! This can come in many forms, such as subscription-based, tiered, or freemium models. The beauty of this model is that it provides a steady, predictable revenue stream for your business, which can help reduce stress and uncertainty.

Let's take a look at Coworking House as an example. CoHo is a business that provides shared office spaces for remote workers and entrepreneurs. We offer different levels of membership, with varying benefits such as access to meeting rooms, high-speed internet, and printing services. Members pay a monthly fee for access to these services, which allows Coworking House to have a steady stream of revenue. We don’t require anyone to sign a long term contract, but on average, our members stay 10 months or longer.

Will this work for any industry?

Now, you might be thinking, "Well, that's great for a coworking space, but how can this model work for my business?" The truth is, the membership model can work for any industry! For example, a private yoga instructor could offer monthly memberships that give customers access to unlimited online classes, or a bakery could offer monthly cupcake deliveries to local offices. You can offer monthly digital downloads if you’re a content creator, I pay for weekly meal plans from PrepDish.com, or monthly coaching sessions if you’re an educator.

Benefits of this Mode?

So what are the benefits of using a membership model to scale your revenue? First of all, it can provide a predictable, recurring revenue stream. Instead of relying on sporadic one-time purchases, you can have a steady flow of income that allows you to better plan and budget for the future. This also allows you to grow faster: once you have your basic systems in place, often its no more overhead to bring on new customers, only increased revenue.

Secondly, a membership model can lead to increased customer loyalty and engagement. When customers feel like they are a part of a community, they are more likely to stick around and become long-term customers. This can also lead to valuable word-of-mouth marketing, as members share their positive experiences with others. Having people consistently interacting with your company, on a recurring basis, means that you’re top of mine repeatedly.

Finally, a membership model can simplify the sales process and reduce customer acquisition costs. When customers sign up for a membership, they are committing to a recurring payment, which means you don't have to constantly market to them and convince them to make a purchase. This can save you time and money in the long run.

So how do you get started with a membership model?

First, you'll need to determine your pricing and what features you want to offer to members. A reminder: make sure that you’re offering something that fits your lifestyle!! Don’t create a membership that requires you to show up and work during times that you are unable to! You'll also need to create a membership portal or platform where customers can sign up and manage their membership. And don't forget to promote your membership model to your current customers! Make sure they know what benefits they'll receive by becoming a member.

Of course, there can be challenges with implementing a membership model. For example, setting the wrong pricing or failing to provide enough value to members can lead to low sign-ups and high churn rates. Like anything worth learning, I have found some great resources on this. Coincidentally, Stu McLaren who is the online godfather of membership sites, has a book out currently, and is promoting his online course. I have no experience with his course (and sadly am not an affiliate!) but his book is really an easy read and full of helpful info.

Don't just take my word for it, though. There are many businesses that have successfully implemented a membership model and scaled their revenue, and I’ve seen it first hand.

My friend Jessica Principe is the founder of All Girl Shave Club and now teaches others how to have wild success with her subscription box course (psst - this is a link to her free Sub Box Startup Challenge!)

Photographer Kelly Anne offers subscription based branding sessions for those who need constant fresh content!

Heck, I’ve seen people monetize memberships in high value facebook groups.

So what are you waiting for? Would you consider adding a membership revenue stream for your business?

If you're interested in exploring the membership model for your business or business idea, I'd love to help! Send me an email at info@kristinhardwick.com with a brief description of your business and what you hope to achieve with a membership model. I'll do my best to brainstorm some ideas and strategies that could work for you. Let's work together to scale your revenue without the stress!