You’ve heard the term “recurring revenue” and you know you want to build it into your business model…
If you’re a service provider, or you offer one-time products, it can seem daunting to figure out how to add a recurring revenue offering to the mix.
The benefits are clear, though: having recurring revenue streams provides consistent cash flow, which can help you scale your business consistently.
You’ll have to put in the sweat equity to set up recurring products and services, but with these 3 methods you’ll be well on your way.
1. Online Courses and Membership Programs
A membership program is a natural source of recurring revenue for businesses that are totally online—or a great, “outside-the-box” addition to physical businesses.
Memberships can take many forms. They can be purely focused on community, like the closed pay-to-play social network at Chairman Mom.
Or a membership site might offer a variety of online courses geared toward delivering education that’s unique to your business.
Some businesses (like Skillcrush and Udemy) depend on online courses for the entirety of their revenue.
Others (like self-publishing expert Derek Murphy and marketing wizard André Chaperon) set up evergreen online courses with a strong sales funnel—automated with smart marketing tools like SendBound—to bring in a large chunk of revenue each year.
Another take on the membership model is a paid member directory—where the benefit of joining is a listing where other interested people can find you. This works great if you’re the hub that brings people together in your industry.
With a membership site, you can do almost anything—deliver high-quality content, build an engaged community, or offer coaching services. Whatever service or product best complements your business can be present on a membership site.
Since only paying members can participate, you hold the cards for repeat customers and subscribers that stay on for months.
For example, instead of spending all your time teaching people how to use software one-on-one, you might set up a membership site that will teach them all the steps to successfully run their business using proven software.
Choose a SendBound membership plugin that has learning management functionality…so you can automate the entire membership site, from signup to personalized learning.
Once you pair your recurring membership subscription with a automation marketing funnel, you’re well on your way to predictably growing revenue.
Membership sites are a versatile, fully-automated tool that allow you to present almost any product or service, and turn it into recurring revenue streams for your business including online courses.
2. Affiliate Marketing Program
The best part about affiliate marketing? You don’t need a product or service of your own to start earning recurring affiliate income.
But it’s also a powerful way to add recurring revenue to an existing business, since you can direct your customers towards complementary products that will help them succeed.
Software as a Service (SaaS) is the golden child of recurring revenue, but designing your own software might not make sense. You can still tap into this source of recurring revenue by being an affiliate. You can even start with recommending SendBound 🙂
This way you’ve got a stable source of recurring revenue, while avoiding the costs associated with developing it all yourself.
Some of the easiest places to start are website hosting plans, online courses, or online retail products. The more genuine your recommendations, the more success you’ll find with this method.
The key here is not just making affiliate sales, but making sure that the people and products you recommend are a good long-term fit. That will ensure that the revenue keeps on coming.
Many affiliate sites can bring in $500 a month in recurring revenue after a year. These sites will likely not make up your entire business, but they can help increase your recurring revenue stream with some initial effort.
3. Service Retainer Plans
Many businesses offer products and services that need regular renewal or check-ups.
Rather than approaching a customer each time they need help with something or need more of your product, offer service packages where they pay for what they need each month.
You earn more recurring income without having to pressure people to buy again and again, and customers receive a discount on the service or regular purchase of products in exchange for the reduced hassle on your part.
Or, offer supplemental services. These act as opportunities to increase your recurring revenue, increase the value of your business by diversifying your product line, and increase customers’ received value.
The key here is to make your retainers make sense: for both you and the client.
How can your retainer offer peace of mind to your clients? Will you be able to save them time, money, or hassle?
That’s often what retainers can bring to the table that one-off projects and products can’t.
Whether you’re a web designer offering hosting, an interior decorator offering cleaning services, or a business coach offering time management software, supplemental services provide high value for your business and your customers.
Think outside the box on this one if you’re stumped. What do your clients also need when they decide to work with you? Do have the “hook up” that might save them time or money?
Remember, you don’t need to be the one to fulfill on this service if you find a good affiliate program to refer to.
A happy customer is a repeat customer
For every customer and every need that customer has, you have a unique opportunity to create a stream of recurring revenue.
The important thing to remember is that, whether you build your streams through contracts, monthly billing, or membership programs, the long-term effectiveness depends on how well you’ve established a relationship with your customers.
The goal is to help your customers reach new goals and experience stellar service—not just to increase the size of your wallet and have regular paydays.