“Hey, check this out,” my brother’s email said. “Just found this really cool site with a lot of great outdoor products.” He had forwarded me something from a little company called Huckberry that was trying to drum up customers.
I looked. Their membership was free at the time; I was in college and free was a price I could afford. I subscribed. And both my brother and I have been Huckberry members since. Apparently we’re in good company, too: Huckberry started with $20,000 in self funding and now sells $158 million a year.
Huckberry built a following through memberships that provided benefits like free shipping and exclusive mobile deals. You can too. Memberships are a powerful tool for growing your business. Why? Because they build customer loyalty.
How Do Memberships Build Loyalty?
Signing up for a membership (paid or free) is an act of trust. Your customers are telling you “This relationship is worth my time. You provide value to me.” Loyalty is a two-way street, and to build that loyalty with your customers you have to give them value. There are multiple ways to do that.
Memberships work on exclusivity. To quote one study, “The desire to possess something that others want exclusively is a great passion of human nature.” When you create a membership, you create an in-group people want to be part of — especially if you make it clear that this status gives them unique opportunities.
Stickiness is a side benefit. It’s easier to give your audience offers when they’ve already let you in. Huckberry built their audience through exclusive content and offers. As my brother and I found out, if you were on that email list, you were going to get first crack at the best products. People will keep coming back for benefits like that.
There’s also a built-in barrier to competition. If your members are already listening to you and spending money on your products or services, why would they pay attention to someone else? It’s harder to walk away from a friend than a stranger. Memberships help you become a “friend” to your audience.
Loyalty comes through this exclusivity, stickiness and barrier to competition.
Who Benefits from Memberships?
Products and services companies can both benefit from memberships.
The key is creating offers that have value for the customer and your company.
Focus on offers that have a lower cost per activity or product. Huckberry is a product company, and they sent out a lot of accessories and small products that had a high return on investment with little cost.
Code Academy is another example; they provide lower-cost services by utilizing courses (build once, benefit forever). Service companies like Code Academy typically focus on services where they can spread out costs over time (for example, guaranteeing a certain amount of customer service each month and betting that most people won’t use it every month). The training that comes with their membership is built on that principle: most people won’t use all of the benefits included.
Whether you’re a product or service company, focus your membership on something that’s low cost for both you and the consumer. That can lead to more frequent purchases, and if the purchase is rolled into the membership, it means more people signing up.
Adding Value to a Membership
The #1 thing that matters when building loyalty with memberships is the value you provide.
To provide value, you need to know what your audience wants. The Huckberry guys did. They were tapped into their audience (young, outdoors-interested men) because they were their audience.
Take a look at Copyblogger too. Copyblogger is still the content marketing authority. They periodically run a content marketer certification program; members of that program will get certifications and be listed on the Copyblogger site where prospective clients might find them. They also get access to the expert editorial team and writing coaches. That access is worth something to their members.
Members find value in memberships with companies like Copyblogger in connections, training and legitimacy they bestow on their members. Huckberry’s value is members’ only access to interesting products and a sense of community.
Figure out your value, then work it into a membership. Your audience will respond.
Membership Benefits
When I mentioned to one of my acquaintances that I was doing an article with Huckberry as an example, he was excited. “I love Huckberry,” he said. “I use Bespoke Post more now, though.”
Bespoke Post doesn’t just offer products for sale through a straightforward eCommerce interface. They build bundles of products and send them out every month, and members get to choose which bundle they like the most.
Other companies like Loot Crate use that bundle model but leave everything as a surprise.
Exclusives are a time-honored membership benefit. Huckberry has exclusive deals on products and Copyblogger provides exclusive access to their writers.
Free products help build value for a membership too. Starbucks built their membership concept on earning “free” stuff. Running all transactions through the Starbucks app to generate membership points created a gold mine of data of consumer preferences for Starbucks and customers participated willingly to get … free coffee.
Membership benefits create loyalty. Give customers more value than they expect and they’ll reward you by coming back over and over and over.
Creating Lasting Value for Your Customers
Memberships let you serve your best customers better. They help you create extra value through extra benefits and exclusive opportunities. And as your customers become more loyal to you, you can make a better experience for them. It’s a win-win.
Provide lasting value for your customers and they’ll give you loyalty, as Huckberry found. If you need a hand building a membership for your customers, contact us. We’ll help you out. Just drop us a line, anytime.
Best regards,
David Brandon,
Copywriter
Rainmaker Digital Services