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The Membership Economy
Find Your Super Users, Master the Forever Transaction, and Build Recurring Revenue
- Read in 15 minutes
- Audio & text available
- Contains 9 key ideas
Today, ownership is out. Consumer trends show that more and more consumers want temporary access, not permanent ownership. And within this changing landscape, membership-oriented businesses are king. The Membership Economy (2015) outlines key strategies and tactics based on real-world examples for successfully building a membership organization.
Key idea 1 of 9
Internet-powered businesses offering customers “access” rather than “ownership” are on the rise.
Just 15 years ago, pretty much everyone had their own collection of CDs and movies. Today, that’s no longer the case. Obviated by services like Amazon Prime, Netflix and iTunes, such collections now seem slightly decadent. With the unprecedented global access to media provided by the internet, a new business model, that of access-oriented streaming services, now dominates the market.
The advantage of this model is that it allows us to bypass all the responsibilities and costs associated with ownership. But it’s a big shift, because the traditional economy is built around the principle of ownership; when customers buy things under the standard system, they can do whatever they want with them.
Just think of owning a car. You can paint flames on the side or adjust the chassis. But, of course, there are also costs. If the car breaks down, you have to fix it. You also have to pay taxes and secure a parking spot.
But what if you only need a car once or twice a month? Renting might be the best solution. That way, you’d have access to a car when necessary, but not have to bear the responsibility or pay the costs of ownership.
Fortunately, the internet makes this kind of access easier than ever before. And over the past few years, new web-powered companies have emerged, giving their customers convenient alternatives to ownership in almost every sector.
For instance, Zipcar members have access to a fleet of company-owned cars. Using a slightly different approach, RelayRides pairs car owners with those who want to rent a vehicle. Similarly, you can rent movies on Netflix or book a temporary room through Airbnb.
Crucially for companies specializing in access, the focus changes from products (the traditional economic model) to customer. More specifically, the customer is no longer merely a client, but a member, as we’ll see in the upcoming blink.