June 24, 2017

The Membership Economy is the New Currency for Business


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Summary


The Membership Economy offers advice for business who have (or are considering) a membership program for their business.

People in business love members. We help them with problems, send Tweets to them, answer their emails, and bend over backwards to keep make them happy. For businesses, membership presents an opportunity for business grow a consistent source of income and referrals. Getting people to become a member represents an opportunity to receive services and products they perceive as valuable to them. It’s a win-win for everyone.

The problem is that getting a member is not so easy. Being a member requires a commitment (however small) or exchange that goes beyond the typical interaction between consumers and a business. That kind of commitment can be hard to find in a fast-paced world, but it is possible.

Members offer something of value, whether it’s time, their email address, their money, or their content or a combination. 

The Best Businesses Build Excited Members

So how do you get new members for your business? Use social media? Create email lists? Robbie Kellman Baxter, entrepreneur and consultant, offers her advice on how and where to get started in The Membership Economy: Find Your Super Users, Master the Forever Transaction, and Build Recurring Revenue.

In her opinion, the businesses that are able to obtain and get members will be the ones that thrive. As mentioned above, members represent a source of reliable income (assuming your product or service is good). In a marketing landscape that is increasingly competitive with users having more options than ever, businesses that retain members will have a financial and marketing advantage. 

According to The Membership Economy, consumers get involved as members for two main reasons, social connection and/or convenience. The book highlights the fact, humans don’t do anything online in isolation. We often turn to others (especially family and friends) for suggestions and recommendations. We also turn to others who have similar interests for entertainment, networking, and companionship. That’s why reviews and social media matter so much. Technology is an extension of our human relationships. 

Baxter also points out that memberships offer people convenience. One big example repeatedly mentioned in The Membership Economy is Netflix, which allows members to watch videos and television shows on any electronic device with Internet access for a monthly subscription. This business setup allows members to watch anywhere at any time instead of having to worry about picking up a DVD from a store and taking it back to avoid a late fee.

The same thing can be said for loyalty member cards, which offer discounts to customers who provide their contact information. In return for their exchange of information, members get discounts and offers at stores they have already decided to frequent. 

These two factors, relationships and convenience, along with membership benefits are the key to any program that seeks to attract and retain customers. Baxter points to several companies that have successfully done this: Crossfit, Netflix, grocery stores, and Amazon. These companies created membership programs that offered great products and services and hassle-free ways to utilize them. 

Besides having a good product and services, member programs also have another feature that leads to their success, enthusiastic feedback. Without members who feel compelled to share their experiences, your member program won’t reach its full potential. Baxter provides Crossfit as an example of this. Crossfit has become a worldwide phenomenon with its own terminology and fervent fans who religiously follow and share everything that comes from Crossfit.

That kind of energy is infectious and continues to draw new members in and existing members even deeper into the program. That kind of customer engagement comes from good products and services that offer value for a specific need or want. 

Is The Membership Economy Worth It?

The Membership Economy is a great resource for business owners that have or are considering a member program. The advice is geared more toward mature businesses (typically large) who already have a program in place. This doesn’t exclude small businesses, especially those with well-developed membership programs will have no trouble using the book.

The Membership Economy begins from the assumption that readers already know who their customers are and what they want and continues along that trajectory. New companies may need to have more experience with their customers. 

The author of The Membership Economy recommends subscription and member options for almost every type of business. If you agree with that assessment, this book will provide several recommendations that can be adapted to your business. The book does not go into a lot of extreme detail on the specifics (setting up a program, marketing, etc.). But it does provide excellent recommendations on key areas of interest to business owners consider a membership program (pricing considerations, for example) in addition to a variety of stories highlighting various membership programs of all types. 

Overall, if you have a membership program, The Membership Economy is a great resource for identifying possible ways to fine-tune it. If you are considering a program, this book can offer general areas to consider while designing your program. 

About the Author

Robbie Kellman Baxter is a consultant, author, and CEO of Peninsula Strategies. She can be found on Twitter at @robbiebax. The Membership Economy will be available on Amazon starting March 2015. This review was based on an electronic copy provided for the review.

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Charles Franklin


Charles Franklin Charles Franklin is a Book Reviewer for Small Business Trends. He has a background as a professional reviewer, and is also a content provider and customer relations professional.

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