[Video] Minimum Churn Membership LiveCast

What if you had a thief break into your home while you were sleeping, creep into your bedroom, take your jewelry and cash, and then leave without getting caught? How upset would you be? Would it disrupt your normal life?

How long would you tolerate someone robbing your home every month? Would you set up an alarm system or cameras? Reinforce the doors? Heck, eventually you’d probably even consider hiring someone to stand guard to protect your family and belongings.

If you have monthly member churn, there’s a thief in your business, and it’s a thief you’ve grown accustomed to and perhaps even tolerate. Churn is the rate at which you are losing members each month. Churn is stealing your hard-won members. Every member that quits takes away something you worked hard to get, something you celebrated when you got it, something you invested good money to earn, and something that’s gone forever. Stolen.

There’s no reason to tolerate high churn rates as a fact of membership — no more than you’d tolerate a thief breaking into your home. Yes, there will always be some churn, but it should be minimal. Too many membership programs tolerate churn rates that are far too high. Instead, you can structure your business with a Minimal Churn Membership.

I understand what it feels like to have too much churn. You work hard all month recruiting new members only to find at the end of the month that almost as many (or sometimes more) have quit. Argh! For the last 20 years I’ve been helping people like you create a Minimal Churn Membership.

Here’s a recording of my recent LiveCast, revealing for the first time my Minimal Churn Membership systems. If you are running a membership program and you’ve had someone quit already this month, watch my Minimal Churn Membership LiveCast.

LiveCast Transcript

Welcome to your LiveCast today, I’m so happy that you’re here. Today is all about minimal churn, and we’re going to make sure that we can grow your membership and help you kill that churn rate and grow you membership. I’m Robert Skrob, today’s date let me look at the calendar. Today we’re live, it’s August 25th. I’ve got a little bit of a sore throat, so I’m going to be drinking plenty of water, and making sure that I still stay well hydrated during our time together. I am keeping this chat open, so say hi, ask questions. Feel free to connect with me during our program. In your messages, your confirmation messages, you should have received some handouts.These we’re going to go through while we’re here together and make sure that we answer questions and that we stay focused on the things that are really going to move you through your business, helping you create a minimal churn membership. What we’re going to focus on today is really helping you grow your membership by creating a structure for growth. What we will see in a few minutes is that so many people, I create a structure for their membership based on what they see somewhere else. It’s sort of like deciding where you’re going to go for your vacation, by driving on the inner-state, seeing a car that you like and following that car to wherever it’s going.

You don’t know where it’s going, you don’t know who’s in it, you don’t know where they’ve been. You just look at it and go, “That looks good, I’ll go that way.” When you swipe a membership program where you see somebody doing a free trial, or you see somebody doing some sort of big purchase with an ad on membership or an up-sale, and you follow that or swipe what they’re doing, or you see an example somewhere and you copycat that. It’s just like following without having any idea really what it’s about or where it’s going or most importantly whether it’s a good fit for you.

What we’re going to talk about today, is how to create a program that’s a best fit for you and your membership to help you grow more quickly. A lot of times the member churn rate is really not about benefits. It’s not about who you are attracting, but it’s about how your program is structured. If your program is structured for churn, you’re going to get a lot of churn. It maybe that you’ve done a fabulous job providing benefits, and you’ve working yourself ragged trying to give and give and give, but you’re trying to drive back to the car analogy. Driving a old jalopy, 25 mile an hour max speed car, and it’s not going the 80 miles an hour like you want, and it’s never going to.

Let us work together today in the time that we have to help you create a minimal churn membership. Take a quick look at the chat, if you have any questions or need anything, feel free to let me know and we will jump in. I wanted to show you a couple of things on my … A couple of slides here, let’s find, share. This is really, really magic. That’s not magic, there’s magic. The key thing about, the reason why we’re really focused on what we’re focused on here, is that member retention grows membership. If you are generating 100 new memberships a year and we’re going to talk a little bit about the difference between annual memberships and monthly memberships.

If you generating, it’s 1,000 memberships a year and each year you are keeping 85% of your members from one year to the next … Actually this is actually monthly. If your monthly churn rate is 15%, and what churn rate is, is the number of members you’re losing in a month, divided by the total number of members you started with at the beginning of the month. I have seen programs that have as many as 25% of their members are losing each month and yes that means every 4 months they’re completely replacing the number of members that they have. That’s because their members are going out so fast that their average member term is 4 months.

Even with a 15% churn rate, you’re going to have about 556 members on average. It’s going to fluctuate a little bit because you’re churn and the number of members you’re getting on any given month are moving around. If you’re getting 1,000 new members a year, and you have a 15% churn rate, you’re going to have about 556 members on an average month. If you simply get the same number of members, 1,000 new members a year, that you lower your churn rate to 10%, you’ll now have on average 833 members. You get it down to 5%, you got 1,667 members down to 2%, 4,167 members. The membership growth sky rockets. The number of members can sky rocket based on churn.

With the same number of new members that you’re adding each year, your numbers could grow, and what I’ve seen is the member churn rate, it can be the fastest way to grow your membership. That’s why churn is so important and one of the reasons why I focus on it so much because you know what, nothing will grow your membership faster than reducing your churn. Holding on to your members longer means you don’t have to work as hard to replace members before your program is able to grow. Is 2% possible? Yes, I have worked with clients that have $1,500 a month coaching programs that are adding lots of new members, and they’re getting their churn rate down below 2% a month and you know what, their goal is actually 1%. Very often they’re hitting it.

It’s absolutely possible whether your membership is $59, 750 or 1,500 a month to get that churn rate from 15 down to 5, down to even 2 or less. If you feel like it’s impossible to get 2%, that’s fine. Why don’t we work at least towards 10 or 5 at the moment, because either of those are going to grow your membership a lot faster than adding a whole bunch of new members. This shows number of new members needed to double within a year. If you want to double your membership in a year, if you’ve got a 15% churn rate, you have to get 11,000 members in order to double. 2% you only need 5,000. If your investment in getting a new member is only $50, that’s $2,000 that you would have to spend in order at 5%.

Whereas you need to spend $581,000 in order to generate the same number of members at the 15%. It’s so much more expensive to generate that many more new members, if you’re having to overcome churn. If you’re out there speaking or you want to get deals, you almost have to generate twice as many of those deals at a 15% churn as a 5%. It’s so much easier to run your business, it’s what gives you that lifestyle so that you can finally stop having to run so hard because you’re keeping your members longer. Then finally at a 10 million annual membership earning before interest and tax, just to give you a sense of what your business is worth. At a $10 million membership earnings before interest, taxes and what you’re paying yourself.

That’s about a $30 million a year business, very respectable. If you have the same $10 million annual membership with earnings at a 2% churn, that business is worth close to $130 million. You can get $100 million swing on the same $10 million revenue simply by a churn. Why? Because, one the member value is going to be longer. You’re getting more from each customer because they’re hanging out longer and 2, the company’s valuations are higher when you have a lower churn rate. You get a higher multiple on that income. These are just a couple of the key reasons why I think it’s so important to focus on your churn rate. Why I really make it a priority to talk about that and focus so much time on helping you with your churn rate.

Again if you have a … Peter I see that you have asked I guess to talk. For now just post your question in the comments and I’ll be happy to connect with you. Then if we want to get John, I certainly can figure that out. You’re going to go to your handouts. One of the key things … I’ve learned more from Bill Glaser about how to make money than anybody else ever, and here’s a quote from Bill Glaser that I heard at one of his coaching, one of the coaching members. Allan you asked a question, “Is the same true if you build a $1 million business at 2% churn, would it be worth 13 million?” The answer is yeah probably, it’s certainly worth more than the 3 million or so that you’d be looking at with a 10 or 15%.

The reason is that the value one, the lifetime value of the customers increases. You’re multiplying by a larger number and then 2, the multiple increases at the same time. It’s like a double hammy on the valuation. Yes, those numbers scale based on the income. Of course, 1 million business might have more risk or there might be some more fluctuation that they’re looking at that might impact the value, but all things being equal, yeah no problem. Thank you very much for your question Allan, and if you have a question, feel free to type in. we’re going to talk about eliminating churn. The quote from Bill Glaser, and the real key here is Bill said, “Our goal as business owners is to transform the customer’s decisions to buy a product from a single purchase to a series of transactions.”

We have a choice of how we want to make a sale. We can either get the customer to buy a product, or we can get the customer and invite them to buy a series of products, as in a membership. When we make that choice and focus on, okay how instead do we get them to buy a series, it’s way easier to make that leap than it is simply to raise prices. You could double or triple the price of your product and not generate as much revenue as you could by creating a member they pay for, instead of selling a product for $199, you sell $199 monthly membership. Even if you had a churn rate of 25% on that, you’re now getting on average 4 months worth of membership, because 25% means you’re losing a quarter every month.

That means on average you’re keeping your members for 4 months. That means you would be generating 4 times $199. To think of it, double quadruple, what’s multiplied by 10 times, [decaruple 00:14:27] or something, what that is you can do it by creating a membership. That was really … I had been doing membership for 14 years before I had sat in on that meeting with Bill Glaser, but I was really aware … I kind of had seen the power, but seeing it from the outside looking in, because Bill was really a pioneer, a membership at that time, but seeing it from his perspective really helped me. Create engagement, retention and generate referrals by replacing overwhelm with goals. One of the key things you’re going to want to do, we’re going to talk a lot about this in the next program.

If you’d like to, you can probably make … I’ll refer this to you later, but if you would like on the next membership, on our next web cast, we’re going to get into a lot of member welcome sequences, and exactly what to do in order to bring a member on because by far you’re losing most of your members in the first couple of months. The key thing is you’re delivering way too much. You are giving way too much stuff to your members and it’s easy to become, “This is way too much, I can’t do it.” Your new members are trying to learn something. They’re trying to figure out how to get value and how to engage and when you give them a bunch of stuff as a download, it’s very easy to be overwhelming.

Let me show you the next thing as a slide. Let me go back over here, I’ll share my screen. One of the key questions I want to ask you, is what transformation do you deliver to your members? This is something that I spend a lot of time with my clients because their core focus is on I want to give them a bunch of benefits and I’m going to give them a call every month, I’m going to give them a newsletter, I’m going to give them this or that or some sort of access to a software or a library or a membership site or a community or a this or a that, and none of that matters. All of that is a total waste of your time and Toner or website dots or pixels or whatever the heck it is. Talking about that crap is a total waste.

What your member wants to know, is what the transformation’s going to be by becoming a member of your membership. What problem does your customer have and how do you solve it. Now, let’s talk about what the customer’s life is going to look like after you have solved that problem for you member. In weight loss it’s very easy to talk about, “Hey, you’re going to look great, you’re going to feel healthy, your friends are going to love the way you look. You’re going to be so proud when you walk into that special occasion and looking great. Those photos of your wedding are going to be fantastic.” All those after picture of a transformation in the life of your member. The next part of your [inaudible 00:18:25] is your member doesn’t want benefits, he wants a transformation.

How do you transform the life of your member, what can you do … let’s write this down right now, how can you improve your offer. What can you do right now that’s going to improve the life of your member? How are you going to frame your benefits so that instead of talking about them in terms of a newsletter, a call? “You get a Q&A call where you get access to me to ask questions and to talk.” How does that help me, how do you help me transform my life? How do you help your members transform their lives? What transformations can you give within your membership? Just a little insider tip, just to kind of do a little inside baseball, that’s why I started with the charts of you can grow.

Is showed you 3 different ways to transform you during … In your business within this LiveCast. First it was by increasing the number of your members, second is by doubling your membership faster. The third was improving, increasing the value of your business. 3 different ways I can help you. If I spend a lot of time on that, I could go what would you do … I mean gosh, $30 million is a lot of money, it’s pretty awesome. What if you could build a business up to $10 million and get a 2% churn rate and have this thing worth $130 million, is that kind of life changing money? Would you be able to make a big difference in this world if suddenly some corporation came along and gave you $130 million for your business? I have got a client who’s there that has a $10 million membership with a 2% churn rate.

These things happen all the time. I tell you just a couple of years ago, he was looking at about 7 or 8%, and now his business is worth many more times than it was simply because he reduced the churn rate, and that’s what we can do for you. This is in a LiveCast, this is a transformation, and we’re talking about how you can transform your life by changing your membership. Instead of talking about your benefits as I’m going to give you a LiveCast, or I’m going to give you call, I’m going to give you a newsletter, instead, frame them in what your benefits do for your member, what is their transformation. A, write them down here and if you would like to share in the chat, I welcome you to fill in the chat.

Also free feel free to tell me, because when I point here to the chat, the chat is actually right there, but I don’t know if that’s like the opposite side of the screen I hacked it out. How can we improve your offer right now? Next is the member path, and this is something that we can string together because this is actually going to be a series of LiveCasts as you know. I already gave you the opportunity to register for the tribal membership one, coming up. Anyhow the 6 steps of the member path, number is attract. You’ve got to do things within your membership, within your business, in order to get members to pay attention to you, and to come check you out.

The next is recruit, so now once they’re engaged, they’re on your site or they’re paying attention to your mailing, or here’s a membership mailing right here from a client that just got sent out and now that I got it, or the prospective members have it, this is the recruit, we got to change this … So I dropped it on the floor. We’re going to change this from somebody they’re attracting to somebody that is buying. Number 2 is recruit, the third step is orient. When they’re in and they bought, we’ve got to get them to get engaged, enjoy their benefit, setting value and become a member of the community because that’s how we’re going to keep them for a long time.

The fourth is ascend. One of the key ways of retaining members is to move them up to higher levels of membership. When we invite them to buy more, and buy higher levels, they’re increasing their commitment to the membership and they’re going to stay longer. Believe it or not, I’ve seen it a lot of times, but it’s crazy. If a member joins for $99, and maybe they’re at the $99 level for 3 months and then we are able to get them to ascend to a $495 level, on average, those members at the $495 level, will stay much longer. Sometimes double or 3 or 4 times longer than the members at the $99 level. How on earth would they staying paying 5 times as much, their commitment is higher, their investment is higher.

Ascension is a key part of retention. Next is retain, we’ve got their benefits and we’re going to have a LiveCast, not next month. September is all about orientation, the LiveCast after September and October is all going to be focused on retaining and then administration. I have seen it all. One of the things that I do is I offer assessments. Where we get in and do, I call them a membership makeover. Where myself and Denise on my team go in and look at your membership. I look at mostly the sales and orientation and monthly benefits, and then Denise goes in and looks at what you’re doing within your software and Denise often finds … Even folks tell me, our systems are tip-top. I’ve got such and such, they’re doing a great job on my Infusionsoft App, keeping everything straight.

We go in there, or Denise goes in there, I don’t look, I don’t know what I’m doing. Denise goes in there, she’s certified Infusionsoft and we can often find 8, 10, $18,000 worth of money that are memberships that have been sold and are being fulfilled, but yet aren’t being collective. Denise has got this whole load of checklist of things to look for and it could be that you don’t have any money that’s outstanding, and that’s great. It would be fabulous to know that you have … Your systems are tip-top. If you want an assessment, I’ll go ahead and put that out.

What we’ll do, is for a limited time because you’re part of this LiveCast, you can have it on a complementary basis. If you would like that makeover and review, just click there, fill out that form and we’ll get into this entire member path. Today on this LiveCast, we’re focusing on the structure of the program in order to help you grow. One of the key things … I got to take a drink of water. It reminded me, are you excited about football season? This is my Florida State 20th Anniversary of the 2000, or the 1993 national championship and it just so happens I got another one tagged. None the less, this is my cup, well I had to pay like $8 for this at the game. Now I spilled my water.

If you like to comment about the college football season starting in a couple of weeks you’re welcomed to as well. The next page, 5 benefits your members want. The first is return on investment. There’s nothing that’s going to replace actually what is your value, and what we call … We got to deliver value. We’ve got to give them great content. By great content, I define that not by bulk or the volume, but by the transformation. Does the content help put them on a path that gets that transformation for them as quickly as possible? That is the content that we need to deliver, period.

I see so many times, “I’ve got this 6-class series that I look and it’s …” The first 3 or 4 classes are all this background in training and information and history and … Well all that is probably fascinating to you and you want to talk about that, you members want their problem solved, they want a transformation. The faster you give that to them, the better they’re going to be. Instead of thinking about all the stuff you can do, let’s talk about what you can do the fastest and we’ll get into this a little more detail in the orient, but I think it’s important to think through and at this point. One of my clients Jim Augustus Armstrong has a flooring success systems, and he works with flooring dealers.

Folks that put in carpets, independent dealers that put in carpets and tile floors and hard wood floors and things, both in new construction and commercial properties. He had been working for several years growing his membership before he and I got together and he had dozens, I think it was like 40 something ways that a flooring dealer could grow their business. I sat down with him. When we sat down, I said, “What are your 3 fastest ways, what are the 3 most effective things?” He told, it was a referral program, a monthly newsletter and then a sales system.

Now within his program, instead of marketing 48 ways, he says I’ve worked with flooring dealers for many years, these are the 3 single fastest ways to grow your business. I’m going to make these 3 available to you through this program. That conversion’s doubled and retention doubled, because folks were focused on those 3 things. Even like he had a beginners program or he focused only on those 3 things and you rotated every quarter of those 3. Then, he added advance call where we would get into other things. He found that even long time members were coming to the beginners program about his core 3 and really ignoring the advanced.

They were getting so much results out of those 3, they weren’t really care all that much about the advanced stuff. They didn’t want the other 45 ways to grow their business; they wanted the 3 that were the most effective. Out of everything that you offer and deliver, what is the most effective for your members, and how can we pull that out and put that on the front end of your membership so that we can get them the fastest result possible?

That’s one of the key questions that we want to figure out. 5 benefits members number one, return on investment. Number 2, is they want to be part of something bigger and with Jim Armstrong, he has an entire mission about billing the big bucks stores. When you hearing an independent flooring dealer, you get done frustrated about lumber liquidators and Home Depot and laws and how they essentially give away installation in order to get the sale.

They are a big discounter and so Jim takes a strong position against those big bucks stores and helping independent flooring dealers win in today’s economy in praising the contribution that independent flooring dealers have tor our economy about providing jobs and growing a business. By taking that position, he attracts flooring deals. They want to be part of the organization, they are very curious about this person who is advocating on their behalf. How can you advocate for your members, how can you be a cheerleader for them in their grand fight and help them grow their lives in addition to growing their business?

They want recognition. One of the key things that we’ve done is with all my clients including Jim is to create feedback loops within the product that invite members to submit materials back to you. I know I had a scare to death about this several years ago. I thought, jeez, I invite my members to tell me how things go, that whether or not they get results or not. They might not be getting results and I might be embarrassed or scared, they are not going to like me because they didn’t get the result that I had promised.

If they are not getting the results that I promised, I want to know about I and you want to know about it so that you can help remove the obstacle, because very often it is just something they’re missing. So many people but themselves in this cardboard box, they could be like … My kids now are 21years old and going to college and then my son is 17 is a senior at high school. When they were young, they would get in this cardboard boxes and play like it was a forte and they would get all wrapped up inside the box.

So many of the folks that I run into have wrapped themselves in some box where they go, “I can’t do this or I can’t do that or it’s going to be too many inquiries or there is going to be too much or I already doing this and adding that would be hard. This box that they’ve put themselves in is preventing them from being able to grow. By giving your members an opportunity to give you feedback so that then you can say, “Hey Alan, thank you so much for your comment, lets grow your business to the $3million.” Hey Brad, thank you for your comment lets eliminate Chan, but even just incarnates can talk about them.

If Brad implements this and creates a new membership offer based on what we talk about today and sends that in, when we talk about it on another webinar, is be thrilled. Folks want recognition. Next, connection with others. Winds folks go through an engagement and they learn about what’s going on, or when they go through a process, they want to be part of a group of people that share that same experience. By connecting them to a community of people that have had that shared experience, then that gives them several points of connection to your membership versus just you.

With my clients auto-training institute, that was a key transformation for them by connecting their members to each other, they used to be … They just had a relationship with their coach and the coaching member loved their coach, that was the only thing they really liked about the membership. In addition to the coach, there is a couple other things, but one of the other big things that they report is they love the connection to the other members. Instead of just having one strings from your program to the heart of your member, you’re creating several strings, as many connections as they make or strings that are keeping them into your program and keeping them coming back to your meetings.

Then finally fifth, an invitation to grow. How would you like to contribute to the group and share what you’ve learnt about growing your membership? How would you like to give back the community? Your customers, your members would love the opportunity to be a guest on a call, to maybe contribute an article they get to that point. Maybe even be, featured on a panel at one of your events or at one of your calls. They want the opportunity to give back to the community. One of the key ways to invite them to give back is to generally ask them for referrals.

This is a very common and different non-profits where the current customers are invited to give referrals. It’s one of the key ways you can grow your membership and get your members involve itchy eye. We are going to jump in here and get into the real meat of the offers here. The first is the concept of term continuity. What term continuity is all about … is rather than selling for in perpetuity where you are joining and you are inviting the customer, the member to pay essentially forever or until they choose to cancel. Instead you are focused on a monthly … on a specific term in advance.

These are often easier to sell because they have a set end period, especially when the term is a short one. Let’s say 3 or 6 months. Under those circumstances, you are giving them a course where you are pitching them, “Hey, we’re going to go through this program, it’s going to take 3 months, you are going to get these lessons. At the end of 3 months, you’re going to have this, you are going to build that, you’ll have these problem solved, these things implemented and all this is going to be done after 3 months and I’m going to help you every step of the way.

That is often a much easier program. Its fixed term in advance, structured curriculum with a specific outcome. Them what you’re focused on during that term is selling them out of the term continuity and into another program. Think of it this way, the term continuity is a sales opportunity to move your customer to a long term open ended program. Ryan Dias has this concept of getting them to buy a small product in order to turn them into a buyer which then you can use as their continuing commitment and consistency to move them to bigger transactions.

That’s the similar concept with membership, with having a 13 week program, 3 months or a 6 months program that then during the purpose for you of that program is to help them see the value of being a long term member. One of my clients Sean Grilley had this type accelerator program where the accelerator program was all about getting them a cash flow surge within 3 months and then inviting them to be part of the VIP program. That did work well for a long time for him because it gave him a low price point, really easy way for a new member to be comfort to get in and then it gave him 3 months in order to move his customers to a higher level.

Term continuity where it fits can be a nice little benefit. One of the key things that I wanted to talk through is the structure of ascension. Think about at level one of … I’m just gave you some names and some ways of thinking about this or what I call mailboxers. Level 2, a remote relationship, at level 3 a personal relationship. With level one mailboxers, their engagement means they’re watching, listening, reading materials that they receive and they typically have the smallest level of investment.

The level 2 are invited to group coaching primarily over the phone have additional deliver … maybe there are some additional deliverables. Then level 3, there is in-person group coaching, one on one coaching and consulting and it’s the highest priced level. Typically level one programs are priced anywhere from $10 a month up to $99 is the range, depending on … Then their price ranges based on how specific the content is. The more focused, the higher you can charge for simply giving them content for them to consume of their own.

Then for the remote relationship with their … I have the opportunity to engage in a call and participate, that’s you’re looking at probably more in the neighborhood of up to maybe $750 a month, so anywhere between … Probably the block for that is going to be somewhere between 1999 and 499 in there. Then, where they actually get to talk to somebody about their problems, get some one on one help, whether it’s in-person or remote, that’s more in the 750 and up. I have clients that are charging as much as 1500 a month for … where folks are coming to a group meeting to anywhere between $750 to $1500 for jumping on that level 3 membership.

Those are the levels that I try to think of when I’m working with clients. Sometimes, a lot of the clients, even n their lowest level like Michael Rosborough, his lowest level right now is level 2. He launched with a level 2 type membership. I have other clients, like Sean Grilley, his, would be more at a level 3 and he launched his business and really even operated for many years with a … has operated for a lot of years with the level 3 only. Now it’s one of his strategic goals this year to create a level one program, but that’s something down the road.

He’s over $8 million a year in revenue, so he doesn’t really even need that level one, but it would be nice as a lead generator. We’re going to break up the chalkboard here and talk about types of subscription membership programs. The number one is Annual membership. We have Pay Later, Free Trial, Gift with Purchase, The Combo. There is another one? Yap, Bundled Bonus. First one we’re going to talk about here is the Annual. The difference between Annual and Monthly; I have a lot of clients and in fact what most of my clients are doing is front ending the monthly membership. Their difference is monthly you get a payment every month and the annual is you get one payment a year.

The challenge with the annual is you need a more robust collection strategy at the end of each year, you got to alert them that you are going to pay, you are going to invite them to pay. You probably need to do more in order to send them letters and to send them messages, to encourage them to respond and to renew their membership. There is this infrastructure, like for instance, with my annual memberships; the default approach to collecting them is an email 90 days in advance, a letter 60 days, email 30 days in advance. A letter with an invoice on when it’s due and then an email 30 days past due and a letter at 60 days past due letting them know that they are no longer a member.

That’s a lot of communication and things to get out in order to get that membership renewed. Now you can do it on auto pay where you’re automatically hitting the card. I can tell you that that is a great program and I certainly love the auto pays, but the fact is is a huge percentage of your members won’t remember the auto pay and that they could agreeing to that and you are still going to need to do as much communication and work, helping them recognize and resale them on why they need to be part of your membership.

Then otherwise with the monthly, you are still getting your credit cards expiring and declining each month, and there’s this monthly process you’ll need to follow through in order to get them to … Most of my clients are front ending monthly, however, they are also both as part of the original transaction. They sell, the whole sales later and everything is all about the month, then when you get down to the auto form, you discover that there is an option to get an annual membership and courses auto bill on annual basis and you can invest and get … We buy with … you can get 12 months with the price of 10, so there is a little discount on price if they go ahead and prepay and get the entire program.

I see anywhere between 5% and 10% taking that opportunity which multiplies you transaction size by 10 for … Even if you do that for 5% of your customers, that adds a lot of return on investment for that marketing program. It can be a nice little thing. We’ve talked about manual and … oops I’ve pressed the wrong button. Now we are going to Pay Later. Boardroom created an entire business based on Invoice Me or Pay Later offers where they sent out a renewal out to customers inviting them to buy some buyer program and invest in a newsletter or invest in a membership and just get invoiced later.

This was more than $100 million a year in revenue that they created this company with this offer, and so it clearly works. You also in order to make this work, you need to have a huge infrastructure to follow up on this. You are going to need to be invoicing them, you’re going to need to be following up with them, to encourage them to buy and actually pay it. There needs to be a series of letters and invoices and follow up in order to get them to go ahead and renew it, but certainly a Pay Later approach if you can pull of the administration can help you grow your program a lot faster.

Gift with Purchase, I have a couple examples to show you. You can take a look at Perry Marshal’s new mastermind club where we took Perry’s 80 20 lifestyle program. It’s like about 80 20 time management, how you can get 5 times the work done for every hour that you work by following what Perry teaches within that program. There is a transformation and you can have it for free when you join renaissance club. There is this huge incentive. Imagine getting 5 hours of work done for every hour that you work. Wouldn’t that be cool, a great transformation? Well, that’s what this program will teach you.

All you need to do to get it is join mastermind club. Nice, nice little offer that …and you can check it out there at RobertSkrob.com/PMMastermind and you can take a look at his letter. There is 80 20 productivity express, you get that when you join. Here is another one and this is the new GKIC offer and how you can get an efficient, affordable and revolutionary system for magnetically attracting a steady stream of customers ready to do business with you. How would you like to have a steady stream of customers ready to do business with you? For your business they are just coming?

The magnetic marketing lifestyle liberation kit will do just that. It’s packed to generate you ideal customer or clients or patients so you can open the flood gates to more wealth, power and freedom. There is a 3 hour audio and a 9 step course and it’s yours for free when you join GKIC gold membership. You can see one of the examples of the annual offer, where it’s 5997 a month or for 59970 you get the whole year. Essentially you are getting 12 months for the investment of 10.

They did have a good uptake of annual memberships that really transformed the profitability of the offer based on the annual memberships alone. Those annual memberships helped really cash flow this entire membership offer. You could take a look at this sales letter if you want to see the entire approach with the Gift with Purchase at RobertScrog.com/GKIC. Next is Free Trial and of course I used Free Trials for a number of years with the information and marketing association. I sold the IMA back in 2012. I still provide content for it, but certainly from 2006, 2005 through 2012 and even now it’s still a Gift with Purchase offer, you get 2 free months of the newsletters and the calls and the program all for $9.78 how to cover post and hand loan.

That offer still works today and was really the core way everybody was generating membership during that time frame. The challenge with Free Trial offers as a I found and a lot of folks have found is that the retention is really very low. Almost all of my clients I’m thinking now, I don’t think any of them are using a Free Trial anymore and really there aren’t any major programs that are growing using a free trial offer anymore. You just aren’t getting the type of member in that has an investment if for whatever reason …

The whole concept of Free Trial is that by giving the folks the opportunity to get it for free, you would end up with members in your program that you wouldn’t have gotten had you made them pay in order to join. I just haven’t found that to be true, that when I’m working with a client that has a Free Trial and we switch them over to a Gift with Purchase or something else, over and over again, they find that they are able to grow faster.

One of the programs I have seen a 78% increase in lifetime customer value, where the members are staying 78% … Were staying and paying more so that you generate 78% more money with … that’s almost double the money from the same customers, but by doing it with a Gift with Purchase versus a Free Trial and they’re generating similar quantities of members. It’s not as if you actually can end up with fewer members when you go to the Gift with Purchase instead of a Free Trial. It doesn’t really actually give you incremental numbers.

Next, the combo and this is the old GKIC offer, and this had a huge Gift with Purchase and a Free Trial. There was this big incentive of all of the stuff you got when you join. Here it was $633.91 worth of stuff that you got when you joined for free and you got a free bonus. This is another version of the Free Trial to give them a big incentive, but again, I found that by inviting them to pay first at the beginning versus inviting them to pay later, you’re able to get as many members and you’re able to … You increase your member value.

Finally the Bundled Bonus, this is a pretty effective approach. The example here is from Michael Rosborough, he is serving CPAs and attorneys that are so into … He teaches CPAs and attorneys how to get clients that have IRS tax problems. This is a bonus that they bought at the tax resource system and within that tax resource system; they’re investing $1997 for this program. Then, you can see here the second, one of the bonuses they get are 60 days free insider circle group implementation coaching, including live training, webinars and tele-coaching calls and 24 hour access to him. I think the program afterwards is I think 197 or 250 or maybe I think $298 is what they pay for that program on a monthly basis. He’s had a very good success.

You see you’re getting the customer to spend, invest $2000 in your program. They’re typically a good customer and you’re going to have a pretty decent … a better retention than you would with a straight free trial offer if you are giving them a free trial off of the Bundled Bonus. One of the caveats here is that as much as possible, you want to make the coaching and the monthly continuity helping them implement the course, versus giving them more stuff.

If the training is more focused around helping them implement what they already have, then maybe is through shortcuts, maybe it’s through training guides, personal one on one coaching, what have you. If your membership is about giving them more stuff, then they are going to be overwhelmed very quickly and aren’t going to be as interested in keeping the retention.

Now, let’s talk about you and your program. What can you do in order to change your offer and improve what you’re doing? That’s what we … how can you immediately improve your offer. You can feel free, we’re a couple of minutes past the hour and my throat is hurting pretty badly. I certainly want to encourage you if you would like to register for the next program, to grab that tribal membership. You can register today and you can go tribalmembership.com and register or go through that link there in the room.

And or if you are interested you can also take advantage of that assessment and get signed up for that so that I can work with you and your team, review your membership and really figure out what we can do to get you the membership makeover and help you grow. That you can also get at RoberScrog.com/assessment. How can you immediately improve your offer? If you like to chat with me offline, you certainly are welcome to at RS@associationmarketing.com send me your offer, send me you thoughts of before and after.

Also, think through your transformation. What is it that your transformation that your program delivers and how can we deliver that in a better way? Can we do a Gift with Purchase, can we tweak it to a Bundled Bonus, is there approach to do annual, what are the levels that we should offer your membership? Let’s look into those, see how we can do that. If you want just send me an email at RS@associationmarketing. Email address is right there on the handouts.

I want to thank you for participating, I hope you enjoy football season starting in another weeks and certainly looking forward to our next life cast, it is out tribal membership is really … I call it tribal membership, but it’s all about how to welcome your members into your tribe. Get them engaged and get them to be part of your community. Tribalmembership.com, get you in and get you registered for that. I look forward to seeing you then, thank you for joining me and I look forward to talking with you next month on your tribal membership LiveCast.

About Robert Skrob

The problem with subscription membership programs is that members quit, I fix that problem. For more than 20-years I have specialized in direct response marketing for member recruitment, retention and ascension in diverse subscription members environments including non-profit associations, for-profit publishers/coaching, subscriptions and SAAS companies. For an evaluation of your current churn rate and how I can improve it, contact me here. I discover there are often two or three quick wins you can implement within a week to lower churn immediately, let’s talk about your quick wins.
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