Ep 152 What is MRR and What You Need for a Kick Arse MembershipNov 30, 2021
Monthly Recurring Revenue, put simply is, monthly recurring revenue from your ongoing membership subscription customers. This can be done in a lot of different ways. It could be a year long Mastermind; it could be a perpetual ongoing membership; it could be super involved, or it could be high volume low cost.
I am going to run through the 4 main things about MRR and what you need to consider before creating your membership offer.
1. Why have MRR?
The biggest benefit of having MRR, is having a predictable business model. By doing this, and knowing when and how much your next cash flow will be, you avoid "feast or famine" inside your business. So often, especially live launching in the online course world, we get influx's of cash when we market out courses to the world, but then nothing until we do it again. Having a membership allows you to have that recurring cash flow every month, and is an extremely safe business model option if that is something that you would prefer.
There is a key player to consider before you implement this though - it requires a lot more work in terms of customer experience and customer touch point. If people are paying you a monthly amount, then they are going to expect a much higher level of value, then say one of your Evergreen courses. Now for me, I love this because I absolutely love the human connection and the customer experience I get to create for my members. However, if you are someone that wants to go away for months at a time, or have other commitments, this may not suit your lifestyle. It also makes for a lot of pressure on you as the server, as you don't want to let any of your customers down and are constantly looking at ways to add value to your membership and the content you are creating.
2. Metrics of Membership Health
When your first member leaves, it can be really hard. Even though 99% of the time it isn't about you, it's about their situation, you still catch yourself thinking - what did I do wrong? It's heartbreaking!
One of the main things you should be tracking within your membership is churn rate. How often are you losing members, and at what point in their membership life are they leaving. Once you understand these numbers, you can start to figure out how you might like to tweak or change your membership offer.
You also want to look at tracking your downgrades and upgrades. If your members are entering your world at a certain membership level, and then deciding to upgrade or downgrade to your next in line membership levels, it can give you an indication of how you might need to value stack your offers more and what you need to change in order for you to hit those revenue goals. In my membership, Her Empire Builder, we have The Club: which is the lowest level of membership where people get all of the resources they need but none of the live elements, retreats or community aspects. We then have the mastermind level where our members get all of the above including Accountability Calls, because some people prefer that sense of community and encouragement.
Then, every year, we look at our different levels and depending on where our numbers are at, we tweak the offers slightly to get them aligned with the business goals.
Then, you need to consider feedback. Her Empire Builder sends out Feedback Forms every 6 months, so that we can get really in depth feedback from our members and tweak the program to suit them accordingly. Initially, receiving feedback can be hard, but you have to take it with a grain of salt and realise that if there are some suggestions in there that you think will change your business for the better - then that should absolutely be considered.
3. Is it right for you?
Memberships are a lot of work, and you need to consider that when you're designing it. Sure, they have the rewards of that beautiful amount of money coming in every month, but if you are someone who spends a lot of time away through out the year, this may not be the best option for you and you may need to focus on your Evergreen courses more.
Another really important aspect to consider when starting a membership is boundaries, and making sure you stick to them. For example, if you are starting a Facebook Group for your members, unless you define your boundaries at the start and explain how you can be contacted, be prepared to be tagged in posts all day every day. This can be really hard, because you, being the entrepreneur that you are, will want to help your clients anyway you can. But, unless you establish these boundaries, you will end up burnt out, resentful and no good to anybody!
4. Creating your membership offer.
Inside my mastermind, Her Empire Builder, we have a HUGE offer menu that my clients pick & choose what they want to include in their courses and memberships. If you want to know more about that, head to herempirebuilder.com and apply now.
The main thing you want to consider, is to provide massive value. Always. This goes for not only your membership, but your short courses too. You want to provide so much content that your clients have all the information they need, but guide them through it in a way to not have them feel overwhelmed. You then need to work out if it's going to be a monthly or annual membership subscription and what types of contracts you will have in place. My mastermind, Her Empire Builder, has no lock in contracts because I understand that people's situations can change, and I want it to be a resource for them that if they like it they can stay for as long as they want, or if it doesn't align with them they can leave - which is totally fine, because it's not going to be right for everyone!
If you want to know more about MRR and what you need to consider when running a membership, grab the full podcast at tinatower.com/152
And, if you are wanting to learn more about your membership offer & building that beautiful MRR, jump into Her Empire Builder and grab everything you need herempirebuilder.com
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