6 Repeat Business Tips to Raise the Bar 2023 |
What do Netflix, Microsoft, your gas provider, and even your local coffee shop all have something in common?
These are all repeat business models that generate revenue. Recurring businesses. In other words, customers are still paying month after month.
Unlike the poor suckers who struggle to win clients and business every month, repeat revenue businesses can often spend less energy and time on customer acquisition and focus on providing value to existing customers they have. Recurring revenue gives you a regular income and allows you to plan in the near future.
There's something wonderful about repeat business. If you create something clients keep returning to, or even willing to spend each month or every year and year, you've created a formula for success.
In this post, we're going to give you some recurring revenue business concepts. These ideas for recurring business will help you design a business that keeps clients month after month which is extremely successful!
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In this piece...
What exactly is recurring revenue?
The benefits of recurring revenue
5. Services for subscription (product-led)
What exactly is recurring revenue?
Recurring revenue is the time when your customers make payments to you repeatedly each month and years.
It may be a subscription or membership business, these usually require regular payment. The account you have on Netflix account will pay Netflix regular revenue, even if you shared the password with your cousin in Idaho.
Perhaps, it's just mean you've built a business that customers keep coming back to - such as Starbucks. These types of repeat purchases also generate regular revenue. In addition, the more frequently clients return to purchase from them, the better value the company.
Benefits of recurring revenue
Recurring revenue forms the basis of many of the most profitable firms around the globe. When we started this piece, we spoke about businesses such as Microsoft. In the past, you used to buy Microsoft Office in a box. It cost you a single dollar and put the CD-ROM in your computer (are we joking here? ).
Then, you'll probably have it downloaded and paid an annual cost. It's not like the $150 CD-ROM that you may have used just every five years, and shared with all of your friends and family, by turning their software into recurring revenue - which is $100 per every year Microsoft can make even more.
This is why more revenue is one of the benefits of a recurring revenue business. Here are some others:
- Lower CPA. Every business has to think about its CPA (cost per acquiring a customer. Businesses that earn recurring revenue don't have to keep reacquiring the same clients.
- The ability to scale. Recurring revenue offers the most scalability. If you manage to keep your churn rates minimal, you can continue adding new customers to your current customer base. It's growth for your business!
- freedom. A recurring revenue business can give you a solid financial foundation which allows you to focus on delivering a great item or service.
6 Business ideas to repeat
1. Community
Here at Mighty We help our clients create one of the most successful recurring revenue businesses out there: community .
The membership communities are a good thing. On the human level, this is because people all seek connections and meaning. By joining an online community, we are able to learn something that is important to us and find people we care about.
The business side of community is pretty dang awesome too.
Imagine starting a company you can start for next to zero and then grow to 100,000 a month. We've witnessed it.
Community memberships can be an extremely profitable recurring revenue venture.
For a community to be established, you'll identify an Ideal Member as well as a Purpose. Select a good community platform , such as Mighty that will let you build and host your community. You can also add your personal branding and all the things you'll need to sell. And you're off to the races.
Through our study, we've seen that communities that charge for membership do better. They're more socially engaged and are more successful.
This is due to the fact that consumers value the things they spend on.
Examples of communities as recurring revenue businesses:
2. Retainer plans
Another type of business that is recurring is one that relies on retainers. It is typically seen in companies that advise on behalf of other businesses, and possibly most famously working with lawyers.
Retainer-based businesses mean that a company will pay the business an amount every month to provide a certain type of services. If the services are ongoing, you've got an underlying source of revenue that is recurring.
Retainer businesses are often overlooked as viable business options however, they could be extremely profitable. If your company provides digital marketing solutions to 10 businesses that charge them every five thousand dollars per month, you've got an agency that earns 50k per month!
You get to focus on your strengths, and build a business around your expertise. Your company will benefit of the expertise you have built up, without having to hire someone to perform the job.
Recurring income businesses:
- Lawyers
- Bookkeeping
- The digital marketing
- Creation of content
- Financial advisor
3. SaaS
One of the most sexiest businesses that generate recurring revenue is what's called SaaS - that means, software as services.
SaaS firms provide their clients with a piece of software to make their lives more convenient. The customer is charged a monthly fee to use that software.
We have discussed the case of Microsoft Office above. It is true that Microsoft works on an SaaS model. Think about companies like QuickBooks, Adobe, Evernote, Zoom, and Dropbox. All of these companies provide software as a services.
It's actually an SaaS company. We offer creators, businesses, and entrepreneurs the ability to develop communities and courses, as well as content as well as commerce. In exchange, we charge our customers a flat monthly fee.
In the past, you'd have to know how to code in order to build the SaaS company. In the absence of code and white-label options available, it's possible to set up the SaaS firm operating - even with a small bootstrap budget
Illustrations of SaaS recurring revenue businesses:
- Dropbox
- Microsoft
- Evernote
- QuickBooks
- Adobe
- Mighty
4. Local business
The transition from SaaS businesses that span the world, let's think about one of our local repeat business ideas Local membership businesses.
If you take a look around your town there are various local membership businesses. One of the most prominent is the gym where you pay monthly to access their facilities.
It is possible that you have been bumped against businesses with recurring revenues such as yoga studios, dance classes, kids sports, or music classes. Every one of these companies offers a product or a service which you typically pay regularly.
Take a look at your local coffee shop, masseuse, or hairdresser for businesses with a repeat-purchase policy. They don't work on an underlying membership system and customers are able to come returning time and time often.
If you'd like to begin an established local business look at what the people in your town pay for. What's missing? And how can you create a business that people will keep coming back to again and time
Local repeat businesses:
- Gym
- Yoga studio
- Bouldering Cave
- Play Cafe
- Hair salon
- Café shop
5. Services for subscription (product-led)
Subscription service is another possibility for recurring revenue business ideas. There are a variety of premium subscription services. take a look at Netflix and Disney +.>
There are lots of subscription businesses doing well on a smaller scale. The popularity of Substack led to an increase in subscription-based newsletters. The mailer Convertkit has joined in as well.
What about an online subscription that is based on a product? If you've ever sunk your money into an alcohol-of-the-month subscription, you've tried one of those. From whiskey to razors, food , books and even underwear, there's a wide range of options
A few examples of subscription-based business revenue:
- Wine club
- Artsnacks mix
- Book of the Month
- Hello Fresh
6. Licensing model
Licensing is yet another one of those business ideas that's not as popular. With a licensing business you have some kind of intellectual property or patent. Your clients then pay you recurring fees to gain access to the.
Last year during the time that Taylor Swift famously re-recorded her debut album, she was doing it to get around one simple problem: someone had the right to her music. Her label owned the licensing rights to her songs, and she was earning every penny from it.
It's not the same as licensing, however it is closely related. When you purchase the rights to a McDonald's restaurant, you're paying to use the name. As a result, the headquarters will tell you how to decorate and what type of cups to use.
But you have a reputable business name with an established track record of achievement and brand recognition when your hungry customers are driving through.
McDonald's The head office, not the local restaurant, operates under an arrangement for licensing.
If you are planning to begin a licensing business, you need to own some sort of intellectual property or brand. When you have it then, you are able to convince others to pay you to use the.
Are you ready to get started?
Whatever model for recurring revenue that you've come up with, we hope this article helped. There are a lot of business models that repeat there, and a ton of proven models. If you play your cards well, yours might be next!
And if you're building the business of a subscription or membership Come build it using Mighty! Our powerful cultural software platform lets you mix the world of community, content, course and even commerce. With Spaces that are flexible, you can mix in live streaming events, live streaming, discussion forums, profiles of members, chat and messaging, and much more!
The app allows you to make payments in 135 different currencies or monetize with token-gating. And we've got a great application for all devices, and you could even opt to get your own white label application.
Entrepreneurs and entrepreneurs from all walks of life have utilized our powerful software to build awesome recurring revenue businesses, including Adriene Mishler - YouTube's best-known yoga teacher, Marisa Peer, and Sadie Robertson Huff.
If you'd like to test the possibilities of what you could build, come try it out! You can try it for free for 14 days with no credit card needed.