We’ve all heard about recurring revenue, and for some, it might seem like a bit of mythical creature. But having a world where recurring income for services delivered month-to-month is not the far-fetched fantasy that some might say they are. Being able to lower the need for constant new sales and allowing for reliable growth forecasting are just some of the benefits that come with building recurring revenue.
Regardless of whether you are a service provider, or you offer a one-time product, there is an opportunity to add recurring revenue offerings. You’ll potentially need to put some upfront equity into establishing recurring products and services, but with a little planning, you’ll be ready to go.
Service retainer programs
As a software developer, you know the value in pushing out regular product updates. ISVs might be able to build recurring revenue with complementary services by offering regular maintenance to an existing product. Instead of negotiating a price with customers each time they need help with updates or fixes, you could offer levels of service packages.
You may also be able to offer services to businesses that sell products or services to monthly subscribers. It is important as a software developer to regularly push updates to your customers so they continue to offer a reliable, secure, and consumer-friendly services and payment processes. You can encourage clients to purchase a service program to help them mitigate any software snafus that might interfere with sales or customer satisfaction.
Membership programs and online courses
A membership program is another example of a potential recurring revenue source. A membership site might offer a variety of online courses, prerecorded webinars, or even a private social network where your customers can get the answers to their questions or basic support.
A members-only site, for example, could teach users step-by-step how to use software to successfully run their businesses. A restaurant merchant, for example, might need to teach servers how to use its new point of sale (POS) system. Being able to set up a fully-automated tool that gives a basic tutorial on using your product will provide a value-add in the eyes of the merchant. New tutorials can be uploaded, at your convenience to keep merchants informed on how to educate their workers on topics such as using the latest in mobile payment technology — and you’ve created an interactive portal that alleviates demands on customer service and is driving recurring revenue opportunities.
Happy clients are repeat clients, so it’s important to remember that every touchpoint can represent an opportunity to create a stream of recurring revenue. Building this value through membership programs or service retainers entirely depends on how well you establish your relationship with the customers and can demonstrate your knowledge on what consumers are demanding from merchants today. The objective is to help your customers reach their goals of growth and success, so having a partner that shares that same vision of service and value will help drive continued success for an ISV and the merchants you serve.