Amazon Prime now has more members than Costco and higher retention. But which company is the best for you to emulate? Amazon’s CEO Jeff Bezos reported that Amazon Prime membership exceeded 100 million members. At $99.00 annually, this has turned into a huge profit center. But there’s more. Prime members spend more than four times more than non-Prime customers with Amazon each year. Meanwhile, you can’t shop at Costco without a membership, which start at $55.00 annually. As of its fiscal 2017 annual report, Costco boasted 90 million members. That’s 10 million fewer members than Amazon. This means Amazon now outpaces Costco by a factor exceeding the population of 43 U.S. states! But that’s not all. Amazon Prime’s member renewal rate is estimated to exceed 90 percent, while Costco, recognized for its longtime customer loyalty, has a retention rate in the upper 80s. Amazon has the reputation of having the … Continued
Member Retention Secret for Getting More Lifers and Becoming the Membership That Doesn’t Get Canceled
“I can’t even get my member to return my call.” I’ve heard it a million times. This person has been a member for months, but now they’re getting canceled because their monthly charge didn’t go through. The team emails, calls, and even sends a letter … no response. In the beginning, there were just a few of these, but now, you can see there is a disease. Members won’t return your emails and calls. This problem started in the hours and days after this member joined. You just don’t excite them anymore. Have you ever gotten excited about buying something, then a few weeks after you bought it you didn’t even remember you had it? And if the company who sold it to you calls you, are you going to take that call? Heck no! Even if you liked them well enough, it wouldn’t matter. No one likes talking to … Continued
In A Divided World, Those Who Unite Their Supporters Win
Your subscribers have several monthly charges on their credit card. How do you make your subscription a “must have” to avoid being canceled? When your member examines her credit card statement with the idea of cutting back on her monthly expenses, how can you avoid being one of the many services that’ll get canceled? She’s likely got cellphone, Netflix, Hulu, Spotify, a subscription box or two, monthly charitable donations, a couple of subscriptions for her work, and perhaps even a food delivery. What can you do to get her to keep yours? It’s not by increasing the value of what you deliver. Yeah, that’s right. Subscription programs often try to double down on the cost of what they deliver, only to be disappointed when it has little or no impact on retention. Or they do their own equivalent of what publishers try to do — deliver 24 pages of content … Continued
Subscription Revenue Is a Poor Substitute for a Viable Business Plan
I had a tough conversation with a client this week. For the last 10 years, he’s been trying to grow his subscription business with a 30-day free trial. He’s been happy taking profit out of the business but has hit a plateau over the last few years. He gave his internet marketing team a budget of $100.00 per free trial member to acquire new customers using online marketing. After two years, membership numbers are up but profit is down. He had no idea what had happening but suspected his new members may not be profitable. He was right. I dug in. After a few minutes with his customer data in Excel, I showed him that only 30 percent of these new members were converting from free trial to paid. (He got 50 percent from his other marketing methods.) And although his subscription revenue is $39 monthly, his profit is just … Continued
What I Learned as an Amway Distributor That Will Help You Grow Your Recurring Subscription Membership Revenue
While Florida State University awarded me a master’s degree in accounting, I earned a “doctorate degree in life” as an Amway distributor for three years. One key lesson I learned as an Amway distributor makes all the difference between success and failure in the subscriptions business. While I was shopping in Dillard’s about a month after graduation from FSU, some guy stopped me and asked, “Where do I know you from?” I had no idea. I didn’t recognize him, but I tried to think and make a few suggestions. He told me his name was Steve and that he owned an international import/export business in town. After a few minutes of small talk, he asked if I was ever open to “opportunities,” as things often come up in his business. I told him, “Sure” and gave him my phone number. Two days later, Steve called me and we met at … Continued
Traveling the World to Fight Subscriber Churn
Every time one of your members quits, a piece of me dies. It is a relationship lost. A promise broken. Opportunity unfulfilled. It’s my mission to help you never let it happen again. I take it personally when one of your members quits. Can we ever make it stop completely? No. And, honestly, we want some churn. We need to get rid of the people who don’t fit or shouldn’t be our members. But as for the rest of them, a loss is nothing but a loss. There’s no way to sugarcoat it. And, if I don’t tolerate losing, why do you? In June, I traveled to Ireland to visit the team at Agora Integrated Marketing (AIM) in Waterford. This is the internal marketing agency for The Agora, the billion-dollar publishing company with newsletters around the world. In May, AIM hosted the Agora Internet Marketing Summit in Baltimore and invited … Continued
The Retention Point Accelerators that Grow Your Member Lifetime Value
These strategies form the key distinctions between people who are what I call “Membership Marketers” and those who are “Member Leaders.” Membership Marketers focus only on the hunt, acquiring new members. Member Leaders are as concerned with keeping the members they have as they are with getting new ones. Member Leaders implement systems to get their members to the Retention Point as quickly as possible. The Retention Point is when members fall in love with you, buy everything you offer and eagerly refer their friends. Chances are, this is already happening a little. You likely have some of these members already. These 10 marketing strategies help you generate more of those Lifers increasing your average member value. And, help you convert some of your Quitters into Lifers to decrease churn, increase retention and grow your recurring revenue. Briefly they are: VALUE is like water; too much is just as bad … Continued
The Answers to These 11 Questions Can Explode Your Recurring Revenue Growth
It’s rare that an interview host does his homework, reads the book, and writes insightful questions. That’s why I was so pleased when Mark Hirsch, host of Growth Harmony’s Brain Trust Mastermind. came prepared with interview questions about my new book, Retention Point. In fact, the questions were so good that I decided to share Mark’s questions along with my answers for you here. Introduction Today, it is my pleasure to welcome our special guest, Robert Skrob. Robert is widely recognized as one of the world’s top member retention specialists. He started out in nonprofits and has helped for-profit companies in hundreds of niches transform customer relationships from “one-night stands” to long-term relationships. 1. Tell us a little more about yourself. What’s your background, and how did you become experienced in membership marketing? I’ve been creating and growing membership programs for more than 25 years. I launched a program in … Continued
How to Finally Grow Your Membership and Recurring Revenue, Simplified
I just got off the phone with a prospective client for the first time. His team is generating more than 10,000 new members a month. That’s awesome — a great effort and commendable result that’s getting them featured in many marketing industry speeches. What isn’t getting featured is the fact that this same company is losing 9,500 members each month. This means they spend 95 percent of their marketing efforts replacing the members who quit. Because 27 days of each month are spent replacing canceled members, their marketing department has 30 days of monthly expenses with only 3 days of growth. If you know of anyone who’s in this position — or if you are in this position — I’m sharing more than 25 years of membership growth experience in a new book I authored called Retention Point: The Single Biggest Secret to Membership and Subscription Growth for Associations, SAAS, … Continued
This Football Phone Reveals the Secret to Attracting More New Members for Faster Recurring Revenue Growth
Memberships are one of the most difficult offers to convert. Yeah, you read that right. Memberships and subscriptions are a lot harder to convert than a single product purchase. In fact, a customer will often spend more to avoid the commitment of a subscription. Think about it for a moment: Men in our society are infamous for trying to avoid commitment. Why would you choose commitment as a business model? What if I told you I had the secret to tripling your membership? Play along with me for a second. What would it mean to your business and life to triple your membership? How much more money would that generate for you? What would you do with that money each month? How much security would it provide you, your team, and your family? Do you want the secret that will triple your membership? I’m happy to reveal the secret to … Continued