I keep hearing the same noise from online digital course creators and experts...
"I want recurring revenue.."
"I need a membership program so I can serve my audience more often..."
"I wish I could stabilise my income better..."
What is the answer to all that noise? Is it a Membership Program? I am about to reveal an alternative strategy to membership programs!
So what is it? ↓
If you have a big audience and you want to capitalise on it properly, here is what to do.
Firstly, let me cast my mind back to when I used to run a low-ticket membership and subscription program many years ago for online guitar teaching (this is where I started out my online empire).
I had created the BEST f&%king guitar teaching content you could find online for $29/pm. I felt so proud of myself for bottling 30 years of playing an instrument into an online resource for NEW or ongoing guitarists who wanted a library of amazing step-by-step how-to videos and at an amazing no brainer fee.
I literally thought I was going to be a millionaire...
But it wasn't the case!
I can honestly say it kept me broke.
You’re constantly dealing with churn 😭
People jump on board and then want to leave in 1-6 months.
I think I read somewhere that the average stick rate in membership programs is 3 months 😟
💥 Here’s the paradox:
Most people start a subscription program or membership because they want recurring revenue 💸💸
It makes sense on paper.
Having someone pay you $29 forever is great.
Only that it never happens in real life (and I learned the hard way).
Unless you sell software or application, or you are Netflix or Amazon Prime... The truth is people truly depend on for their life and business with recurring income, but don't realise that most people will try out your membership and then decide to cancel pretty soon.
Follow My TWO Steps Below:
Sell your membership as a yearly pass instead of a monthly subscription... 🙃
... YES I am saying to scrap the monthly idea and don't get caught burning the churn (sounds backward but hear me out)!
Treat your membership like a 1-year long course (my friend Rachel Miller does this and it works amazingly well for her business).
People pay to get access to a whole year of membership and they can pay in full upfront or split out the payments, just like any online course & coaching program. And when the yearly subscription is up, they can renew to the NEW version of the program but at a members-only lower fee, or choose not to renew for whatever reason and keep the original course they bought but minus the new updates.
Here's more detail on how that works ↓
Rachel's online course is $997 per student. And 12 months later when she opens the doors again she has updated her course with new relevant content, but charges existing members to renew at a lower fee of around $300 for another 12 months, plus the new content, and the ongoing support.
To make your yearly subscription more attractive for your customer, you can charge several hundred dollars for an offer like this, and anything up to $997 is actually average these days for online training.
Remember, this is no different than selling a course... BUT instead of monthly churn where you are trying to keep customers happy to stay for longer than 3 months, you can concentrate on keeping your members happy all year round which means you can better plan your content, and provide better a community experience. Rachel Miller has the BEST online community support I have ever seen, and it's because of this simple yearly subscription model that allows her to focus on her people, and not worry about losing monthly members.
Oh, and did I mention, Rachel even drip-feeds her course content just like you would a membership program. 🤓
But here is the REAL gold to this strategy for running a yearly subscription is you get to stack your launch revenues from previous launches across the whole year (more on this below)!
So by doing a yearly 'course' subscription, you’ll make MORE money than if you sell the membership monthly.
(Because of the churn, remember…)
That is where Step #2 comes into this process:
One thing to keep in mind is that online memberships are no different from an online course that comes with community and on going extra support. The content you decide to teach in your membership would be the same content that you would teach in a course.
And to sell a membership program is done exactly the same to how you would sell an online course. Both are are sold with an online event called a launch.
Here Is How We Bring In Recurring Revenue From Courses:
When you have an online program that is at least $500 per enrollment, to make your offer a no brainer for your customers who can't afford a large upfront one-off fee at $500, instead you can also offer a payment plan which is a more affordable option for your customers. A payment splits out the cost of your course across monthly payments at a lower fee per month. $500 divided across 6 months would only be around $83 per month for your audience.
So if you launch your course several times per year (we recommend at least 2 - 4 times per year), you will get to stack your launch revenue on top of previous launch revenue over and over again.
This is HOW you get recurring revenue that you want for your business, and online course payment plans work MUCH better than a lower monthly memberships model.
Think about it...
Let's say you launch in Jan selling your $500 course, and you enroll 20 new students who all take the 6 month payment plan of $83 per month. Now you'll be earning roughly $1,660 per month of recurring income for the next 6 months.
You then decide to launch and open the doors to your $500 course again in April. To keep the maths easy, let's say you enroll the same amount of people, 20 new customers, on the same $83 per month payment plan for 6 months.
Now you have a NEW additional $1,660 monthly income on top of your original $1,660 you made in Jan. So for the next 3 months between April - July you'll be earning $3,320.
And all you need to keep doing is stacking launch revenue on top of launch revenue... And of course the more customers you bring in each time, the more monthly income you make for your business.
Here Is WHY This Strategy Is SO Much More Lucrative For Your Business Growth:
✅ A payment plan isn’t a subscription that can be canceled anytime but rather a commitment to a fixed number of payments.
✅ 20 x $83 x 6 months is much more profitable and manageable for your business vs a monthly membership.
✅ Online courses & coaching programs are more suited to perfectly feed your customers to your high-end products. Whereas a membership is a LOT harder to convert students to a higher program.
✅ You can ask for a higher one-off fee when customers first join your program before payment plans kick in meaning you will get an instant HIT of cash upfront.
✅ An online course validates your offer for your online program, whereas an online membership is harder to validate because of drop off rates and the churn.
😲 Of course, some people drop off or default, this is natural.
But the stick rate is way higher and there’s way less churn.
One of the BIG negative factors with a membership model is that businesses forget about their existing customers because they are always too busy each month focusing on bringing in new customers.
THINK ABOUT IT.
If they knew the big benefits of the model is you will guarantee have your customers paying you for 6 months with recurring revenue, this will instantly give you an easier strategy for filling a high ticket program with existing customers, or another money-making opportunity that your audience have expressed they need.
The other BIG factor with a payment plan vs a monthly subscription plan is your average payment duration will likely be 7-8 months instead of just 3 months. 💰📈🤑
IN OTHER WORDS. YOU MAKE A LOT MORE MONEY.
BUT what happens if a bunch of people's payments stop, you ask?
>> If you are clever and run 2-4 launches per year, then you have nothing worry about because you know you'll hit an instant income injection for your business because $500 courses will always out perform a $30 per month membership.
And remember the BIG strategy take away from this blog post?
LAUNCH REVENUE STACKING
The unique method for generating more recurring profitable revenue vs membership programs.
The EASIER, more profitable, less stressful monthly passive income model.
NOW do you see the golden monthly pot of money, 'the membership model', is actually incredibly hard to stack!
What if I have a low priced training program?
You could make this work if you have a smaller priced program at $200, and with your customers only paying you $20/ pm for 10 months, it makes it very affordable.
But low pricing becomes harder to scale, and it takes a LOT longer for you to feel your time is being best spent with an audience who are paying $20/ pm.
However, with more regular launches or running an evergreen launch would suit this method at a low price.
💡 My tip: Try aim for $500 at the very least for your yearly subscription because on average your customers should be able to afford $50/ pm - $100/pm and more. But you MUST charge what you feel is the perceived value of your training.
If you have a program that is worth $10,000, and your customers can easily afford $1,000/ pm for 10 months then what is stopping you from charging that.
DO IT. Never Undercut Yourself.
Good luck, and have fun creating your monthly stacked income from product launching and the yearly subscription method.