For the past 10 years, I’ve enjoyed success in online business. Now, when I’m not helping my clients with their marketing, I help others grow in the world of digital entrepreneurship. I love seeing people realize they can quit their 9-5 and build the life of their dreams!
I do it through teaching them real, battle-tested techniques, instead of the garbage so many so-called “gurus” try to sell.
I teach new entrepreneurs how to build recurring income instead of lump-sum payments. It was one of the first obstacles I had to overcome on my way to building a 7-figure online business.
I’d go so far as to say that building a successful online business WITHOUT recurring revenue is downright impossible. That’s why I always point my students toward gaining a few 4-figure-per-month clients and doing everything they can to make them happy.
Creating recurring revenue is the next step right after your first win in online business. How do you get your first win? You employ the M.I.L.K. It Method. Click here to download my FREE guide!
Recurring Revenue Beats Single Transactions Every Time
The reason you should start building regular, monthly revenue is the same reason businesses like Netflix, Costco, and your local fitness center. They all offer monthly-renewing subscriptions to their service, and it pays off handsomely.
This model leads to more revenue over time. When a consumer must choose between spending $120 now, or $15 per month for a year, most will choose the $15 per month, even though they’re paying 50% more.
For more expensive products, like cars and houses, paying monthly instead of all-at-once makes an “impossible” purchase, possible.
For your online business, you’ll always generate more revenue by offering products and services on a recurring basis, instead of piecemeal jobs. Combine this with the fact that it’s always easier to retain existing clients than to gain new ones. It simply takes less time and energy. Plus, the work you do to retain clients pays directly, while lead generation doesn’t.
Keeping a select number of happy clients with recurring revenue also helps you plan your budget. You’ll have a good idea of your upcoming revenue instead of having to guess.
As you build a budget, you can stop living paycheck to paycheck by putting profit first. My podcast with Mike Michalowicz explains how.
3 Tips For Recurring Revenue
With all that said, here’s how to get your recurring revenue streams started.
- Develop a Product With a Recurring Monthly Membership
The only way to generate monthly revenue is with a product or service that retains its value long-term. Let’s start with products.
Back in the day, there were few products operating on this model. Off the top of my head, I can think of magazines and utilities. Nowadays, with the explosion of software-as-a-service, it’s everywhere.
Is there any sort of product you (or a hired helper) can develop that’s worth subscribing to for months or years at a time?
My business partner and I developed software that helps new digital marketers gain and track clients, requiring a monthly subscription. But neither of us knew how to develop software. We just hired a developer and explained the vision.
We also offer a monthly newsletter membership, and you can too. All you need to do is create and collect useful information centered around a certain passion, and you’re there.
- Get On Retainer For Monthly Services
This one requires developing a valuable skill or two and offering it on a recurring basis. You’d be surprised what businesses will regularly pay for… until you realize just how much pain and pressure you’re taking off their shoulders with your skill.
Because I specialize in helping local businesses develop a digital marketing presence, I teach my students the same thing. If they can learn SEO, social media management, and how to create and update websites, they can get on retainer with plenty of businesses in their vicinity.
If you want a six-figure digital marketing agency, all it requires is getting 4 businesses to hand you their digital marketing for $2,000 per month. I think it’s the surest path for a beginning digital marketer.
Fill in the blank with your own skill. It could be digital marketing… or it could be business administration, productivity, writing, video creation, customer success, you name it. If you can do it well, you can find businesses to pay you monthly to do it for them.
- Develop Packaged Tiers
Now put it all together. When you have your product or service down pat, you can start developing packages to offer to prospective clients. This helps the client because it gives them a choice of how much they want from you. It also helps you, because you can charge much higher for your top-tier packages, even if they don’t require too much effort.
For example, a digital marketer could offer a basic $500/month package that comes with a simple website, regular emails to their list, and a few ad campaigns managed each month.
Then, they could offer a $2,500/month package offering unlimited website updates, emails, campaigns, and SEO. This package costs 5x as much but doesn’t require 5x the effort from the marketer. It could, however, give 5x the results for the client.
When you develop a good product or skill, start learning one or two more. Then, create three tiers of services that progressively add more elements into the mix. Once you have just three or four businesses subscribed to your top tier, you’ll see more revenue coming in than you’ll ever earn by offering services piecemeal.
The bottom line is finding happiness and fulfillment in your entrepreneurial career. My podcast with Taylor Morgan breaks this down further. Give it a listen!