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Innovation Insights by Stephen Shapiro

innovation using membership modelsIs it just me, or has every industry moved to a subscription/membership model for their services and products? This seems to be a new form of business model innovation, especially when it is married with online services.

Of course the concept of memberships or subscriptions is not new. Gym and health club memberships have been around since the beginning of time.

But the idea seems to be expanding into new industries with increasing speed.

Product Subscriptions

Dollar Shave Club is a well-known product subscription. Pay a flat fee per-month and razor blades will show up in your mailbox. Of course Gillette and others now offer their version of this. GoodMouth and Quip are doing the same thing for toothbrushes.

Amazon.com has their subscribe and save. For products you consume, you can save up to 15% if you have them shipped on a regular basis.

And there are many more examples of product fulfillment subscriptions.

Service Memberships

But what I find even more interesting are the service-oriented memberships. Unlike a gym membership, these require someone’s time and energy. Before the advent of memberships, these services were typically bought on an hourly or per use basis.

Some memberships still charge per use/hour, but offer a discount for a subscription. Massage Envy charges you $59 a month, every month. You get a one-hour massage for that cost. Each additional massage is discounted to $39.

But others have an “all you can use” model, such as Marilyn Monroe Spas, which offer unlimited services such as haircuts for men, and blowouts, nail services, and waxing for women. Pay one fee per month and go all you want.

Rental Models

This model is also applicable to the world of rentals. Instead of buying a boat, or paying a rental fee each time you use one, you can get unlimited access to a motor boat through Freedom Boat Club. You get two reservation slots. As soon as you use one, you get another. You are also not limited to one boat or one location, but rather have many to choose from. The company that owns the boats maintains and cleans them. And the total cost per year is less than the cost of the boat slip dues for one boat. I wrote about this model a while back when talking about servicizing a product.

Medical Memberships

This concept has even expanded into health care.

The Joint offers a membership model for Chiropractors. For $49 a month you get 4 adjustments per month, with each additional adjustment at $12.

Telemedicine is now shaping the way traditional medical services are offered. Online USA Doctors has membership models for online medical health. You can consult with a doctor online. No more waiting rooms.

The unlimited model has even been applied to online mental health services such as BetterHelp and TalkSpace. These offer unlimited texting to a licensed therapist for a flat fee.

Your Business?

I even use this model in my business. My clients can keep me on retainer, giving them unlimited access to me via phone/email for a flat monthly fee. It is affordable for them and gives me the flexibility to schedule calls/emails around my other commitments.

Here’s the question for you: In your industry, how can you apply a subscription/membership model? How can you make yourself more accessible to your clients, potentially at a lower cost?

P.S. All costs here are subject to change. Inclusion in this article does not indicate an endorsement of a product or service.

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