Money Minute: Memberships Hack
Summary
- When running a membership business, focus on two main incentives: signing people up and getting them to stay.
- Use bonuses or discounts to encourage sign-ups, but think beyond that for retention.
- If on average, members leave after six months, introduce an incentive at months four or five.
- Offer a lifetime discount or benefit at this time to keep them longer.
- Extending a member's stay by just one or two more months can significantly increase your profits.
Video
How To Take Action
I would suggest implementing strategies to boost both sign-ups and retention for your membership business. First, think about simple incentives like bonuses or discounts to get people to join. Make it easy and attractive for them to take the first step.
But don’t stop there. The real magic happens when you focus on keeping your members longer. If most people leave around six months, create a special incentive at months four or five. Offer something like a lifetime discount or a unique benefit. This doesn’t have to cost much, but it should add real value to their membership.
By giving members a reason to stay past the usual exit point, you might extend their membership by one or two months. This small change can significantly boost your profits because each additional month with a member directly increases your income.
Remember, the key is to know your numbers. Understand when people typically leave and plan your incentives accordingly. It’s all about getting over that hump and making members see the long-term value. Keep it simple, low-cost, and high-impact for the best results.
