Building a membership business (Part 1)
At PeopleHub, we service several different business types, but as specialists in recurring, direct debit type payments, it is usually subscription based services or clubs which have the greatest need for our products. We refer to these businesses as membership businesses and while they operate in different fields and service different demographics, the successful membership businesses share a common set of qualities.
Membership businesses are generally built around the following concepts:
- There is a common purpose or interest bringing a group of people (for example sailing, breeding canaries, sport or reading)
- Members are willing to pay an ongoing fee to be part of this group
- Members are provided with some material which identifies them as part of the group (for example a shirt, badge, certificate or piece of equipment).
We’ve been fortunate to speak to a number of successful membership organisations over the past 5 years and the list below describes the key activities they’ve undertaken to build their memberships from 1 member to thriving communities.
- Identify the key common needs of the group and go out of your way to deliver on those needs. Successful membership organisations are not built over night, but the fundamental element of any successful
But wait….. there’s more – how to implement payment plans for your product
We get enquiries from many different business owners about our payment solutions. They suspect that we might be able to help them but don’t really know where to start and what the adoption of a payment plan type set-up might look like. The truth is, payment plans have been around for years. From placing a surfboard on lay-by when I was young to buying a set of steak knives from Tim Shaw, payment plans have been a simple and easy to implement strategy to make products more affordable. PeopleHub’s direct debit system can make payment plans a real option for your business. Below I’ll tackle some of the regular question.
How do I make sure I get paid?
You will note from a previous post on avoiding the pitfalls of direct debit that there are some risks of providing direct debit to your clients. There are a couple of strategies that you implement as part of your payment plan or lay-by system.
1 – Don’t provide the product until you have received full payment. This is obvious I know, but with the proliferation of rent to own products, many products are provided upfront with payment collected over a period