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Membership subscription revenue is the holy grail of revenue models. Everyone wants to get revenue coming in consistently, month after month, on auto pilot.
You just set it and forget it, right? It’s not so easy.
A lot of people think that because subscription revenue is recurring, they can just set it, forget it, and it continues to make them money. Of course, this isn’t how it actually works.
Whether you have a membership site or a software that’s sold as a service, you have this thing called churn. Your churn rate is the percentage of people that sign up and end up leaving rather than staying.
Churn is something you want to keep down. You want to have a very low churn rate, which means that members or users stay for a very long time. How do you get people to stay for a long time?
To get people to stay, you have to deliver something of value and you have to deliver it consistently.
Now, there are aspects of delivering consistent value that can be automated, but you have to have something that’s new and something that’s fresh, otherwise why would someone continue to pay for something?
There must be something new, there must be something fresh. It’s the freshness part that usually takes ongoing work and this is the thing that people don’t like to think about when they think of subscription revenue.
They don’t like to think about the ongoing work they have to do, but you do need to do ongoing work.
You do have to continue to provide something that is fresh, new, and is continual value. The way we do this in the seanwes Community is to provide live shows every single day.
Now, that’s a lot of content, but we also have a network, so there’s a lot of podcast hosts on the network, which helps us with content creation.
You may be only by yourself or only have a small team, and it’s going to be hard to continue to produce things regularly. If you have enough subscription revenue, you can pay people to help create that fresh value.
Services like Netflix provide value in the form of movies or TV shows. They consistently deliver it to you, it’s consistently available, but they’re also regularly adding new content.
It’s that freshness that keeps you around. On the other hand, lack of freshness is the reason that you leave. Services like Netflix have value that they consistently provide to you over streaming and then they’re consistently updating archives for the freshness.
Whether you’re a person on Netflix or not is probably predicated on whether you think Netflix provides enough fresh content or enough fresh value.
You may stick around for a little while and watch the movies and tv shows that you like, but after you’ve watched them, if there’s nothing else new coming, you’re not going to stick around. The people who have left Netflix left because there was no more fresh content. e
Value and consistency will get people in the door and keep them for the first few months.
The freshness factor is what keeps them indefinitely.
The more factors of freshness you can add to some kind of subscription product, service, or membership, the longer people are going to stay.
For us, in the seanwes Community, we have live shows every single day, where members come together and they get to discuss the show, ask questions, and talk with the hosts while they’re live on the air, but we also have forums, Q&A, and different live events that we do along with the live shows.
The more unique value you can add that keeps things fresh and new, the longer you’re going to keep people.