Membership business models aren’t just for the big guys anymore.
Your small business could be just like Netflix.
It might not become a multi-billion dollar company overnight, but small businesses are beginning to see the perks of using a subscription business model, like the streaming service has for its members.
In a membership-based business, customers sign up for unlimited access to a product or service for a recurring fee. Larger companies or media outlets have typically used this model in the past, but small businesses are beginning to cut in for their own share of the market.
“This type of model not only enables me to provide a service that is often cost-prohibitive to many individuals and small businesses, but it also provides me with a recurring stream of revenue and has allowed me to expand my offerings,” Pamela Carpenter, founder of Website Rescue, told The Huffington Post.
The security of that recurring revenue is one of the appeals for small business owners to use a subscription business model, according to Business.com
Membership-based businesses can stretch into a wide variety of industries. Two New York City entrepreneurs hosted a launch event for their subscription-based dog food service, The Farmer’s Dog, earlier this month. Their canine meal-preparation service costs members $15 and up a week to use.
“A dog eats the same thing, for the most part, so it’s the ideal subscription customer,” Jonathan Regev, co-founder of The Farmer’s Dog, told the New York Business Journal.
This business model differs slightly from brick-and-mortar selling because it’s less about how many customers a business can get and more about how loyal they are, according to Harvard Business Review.
Some experts believe the trend is just beginning and will continue to grow in future years.