We started out with what was initially a mini crusade in 2002 after working with a number of UK based gym chains. Watching how people ‘rented’ their gym for regular monthly visits, creating their own sense of community/belonging along the way, and paying seamlessly on the first of every month for the pleasure, had a profound effect on us and how we helped businesses acquire and keep new customers.

As a specialist marketing agency/consultancy that focuses on customer acquisition, to us it was the holy grail of customer interaction and revenue.

17 years on, millennials are adopting the ‘subscribe, don’t buy’ concept in their hundreds of thousands on a daily basis. The rest of us are starting to follow in greater numbers. Part financial restraint, part lack of interest in ownership, has seen it spread across almost every industry. But it’s a painful change for many businesses – many often waiting until it’s too late. Blockbuster ignored the opportunity and has been replaced by Netflix – a company it turned down the opportunity to purchase in 2002 for $50m (its current market value is $142 billion!!), and HMV (albeit hanging on by its proverbial fingernails!), once a stalwart of Saturday morning shopping, has succumbed to the simplicity, non-ownership subscriptions of Spotify.


Industry by industry the change is coming…

The last few years has seen the automobile industry come to terms with it. Porsche is trialling a membership scheme in Atlanta, Volvo is going all in and Turo, formally RelayRides, has taken on Avis/Enterprise et al with its membership based peer to peer car hire service – giving its members access to pretty much any car they want.

The Times newspaper has given itself a platform for the future, whilst at the same time saving its journalistic integrity, with its digital subscription model. It currently has more ‘members’ than they have physical traditional newspaper sales.

And if you’re thinking that a recurring payment model won’t work for your business, take a look at Urban Outfitters. The US based clothing retailer is battling the decline of retail with… a membership model.

A membership model is the only true win/win for the business and consumer relationship. For the business there is a set, regular revenue stream on the first of every month, giving the piece of mind of knowing your income is guaranteed for many months to come. It also provides the chance to treat customers/clients more personally; ‘membership’ transforms a purely transactional encounter into a lasting relationship based around a sense of belonging (something we all yearn for).


For the customer, they simply no longer have the hassle of dealing with the ownership of things!

Unlike the traditional business model you must start at the bottom of the customer acquisition funnel when entering the membership economy. Be sure that the membership benefits, packages and products align before you invest a single penny in acquiring ‘members’. Look at how you can create a culture within your business that is focused on language, processes and service.

And then keep it simple – at least initially; drive your membership proposition with a single, obvious and desirable benefit and deliver it to a core appreciative audience. To really understand this approach take a look at the work undertaken with Amazon Prime. It’s membership programme, driven by unlimited one-day delivery surpassed 100,000,000 members early in 2019.

And the financial implications are obvious. The average annual spend per Prime member is over $1,400 – more than double the $600 dollars for non-Prime members.


The hidden sauce is an entry level freemium model but let’s leave that for another day…


If you’d like to discuss all things ‘membership economy’ or anything related to our specialist area of Customer Acquisition we’d love to chat. Simply call 0870 742 4458

Photo by Austin Distel on Unsplash