We’ve put a guide together to help businesses obtain some ideas for recurring revenue, read on to find out more.
Whether you’re a new business or you have operated for some time now, one of the most favorable business models out there relies on generating reliable income that keeps coming month to month. We refer to this as ‘recurring revenue’.
It’s not uncommon for recurring revenue businesses that put in hard graft from day one to see returns relatively quickly; others see the results in the longer-term. Having a consistent revenue stream allows your business to expand using the cash flow acquired.
1. Consider a business based on a membership
Running a business that offers a membership allowing customers to gain access to a service is a great use of the recurring revenue model. You could set up a membership site where you offer content, coaching, or consulting in the form of video, images, or written media in return for a monthly fee from your client. A plugin or platform is often used to handle sign-ups, and only those that pay can access your content.
Monitoring your sales funnel, creating Recurring revenue, and building your customer base are all benefits of this first method. There are a variety of forms used for membership sites such as offering resources, packaging information, community, coaching, or combining all of these into one site. For a regular fee, you can use membership sites to automate elements of your sales funnel by providing open access to users when they sign up and pay. You can charge members monthly, or you could give them a discount on purchases made annually.
2. Consider offering a Software as a Service (SaaS)
Similar to the way we’ve mentioned offering a membership, you could offer software as a service. By this, we mean selling a piece of software at a monthly fee. These types of products must often meet the requirements for increased quality and improved customer service due to the nature of this method of cashflow.
Adobe is probably one of the biggest examples of a soaring SaaS brand, where they switched its Creative Cloud platform into a monthly/annual subscription service. As a result they have increased their revenue and value, and pushed their products to many more businesses.
3. Rise up as a SaaS Affiliate
If you’re not offering software, how can you become competitive in the SaaS space? Affiliates are the way to go!
Affiliate programs take customers from your website to purchase products that align with their business. If that customer trusts you, they’ll be more likely to trust in the provider you are sending to, making them more likely to invest in the service being offered.
When one of your referrals purchases a SaaS license, you, as an affiliate, will usually receive some commission as a thank you. This enables you to get a slice of the SaaS program cake without having to offer your own software!
4. Offer Physical Product sign-ups
This model is referred to as the ”box subscription”. Get your foot in this door, and you’ll be in a good place. Places like Stitch FX and the Dollar Shave Club have seen colossal success with this model.
Take HP instant Ink as an example; you sign up and receive ink every month for a recurring fee which ensures your printer doesn’t run out of ink. The business gets a monthly income stream, and everyone’s a winner.
5. Build a Retainer Plan
Businesses using this final model offer products or services that won’t last forever, so instead of approaching the consumer, they rely on a monthly retainer fee. The customer is never pressured to buy again, and you get a recurring income. Customers may receive a discount on the product or service, and there’s less hassle induced from your part.
We hope you’ve found our recurring revenue guide useful, and drop us a line if you have any queries.