The Membership Economy: Find Your Super Users, Master the Forever Transaction, and Build Recurring Revenue

The transformation from ownership to access results in lower risk, lower up-front expenses, and lower maintenance.

For your members, the transformation from ownership to access should result in lower risk, lower up-front expenses, and lower maintenance. If it doesn’t, they will leave. And some of them will leave—it’s part of the pruning process.

“We’re not finding a cure for cancer, but we are humbly making an impact on something that matters to our customers. Their problems are our problems.”

Membership and community are related and overlap, but they aren’t the same. Membership, as we’ve discussed, is about a formal, ongoing relationship between organization and member. Community is about connection and communication among a group of people with shared interests.

The Membership Economy relies on trust. It’s about the consumer saying, “I’m going to stick with you, but I expect you to continue to deliver.” It’s the mutuality of the relationship that makes the model so beautiful.

The approximately 20 percent of customers who have visited a business 10 or more times drive 80 percent of the business’s total revenue and 72 percent of total visits to the business. The most loyal customers are less price-sensitive, more likely to be up-sold, and much more (70 percent more) likely to talk up the business.

There are specific types of engagement that make it harder for people to leave. For example, members are more reluctant to cancel memberships when they’ve achieved status (think airlines and hotels), customized their experience (once you’ve set up your online payroll system, scheduled your regular Tuesday lesson and Thursday tennis match), or built

People want to be connected. They want to share and to engage with others, and the digital world is often a faster, more effective way to build relationships. A membership organization needs to till the soil, seed the ground, and protect the seedlings from predators, but most of the growth will happen through the community.

Leaders in the Membership Economy know how to work membership into people’s days.