Rob Nissen
rob.nissen@fortierpr.com
Predictable Profits: Transform Your Business from One-Off Sales to Recurring Revenue with Memberships and Subscriptions
Stu McLaren
Hay House (February 2025)
A secret sauce for “wildly successful” businesses
When I was in high school, I participated in the Junior Achievement program in Chicago and attended its annual “Future Unlimited” banquet. I sat next to the CEO of a Fortune 500 company and at one point asked him what the secret for success in business is. He replied, “Find something that costs a dime, sells for a dollar, and is habit-forming.”
There is an unlimited number of “secrets to success” in the business world and none of them is effective for ALL businesses nor is any one of them effective for all businesses within the same industry segment such as airlines, book publishing, insurance, farm equipment, pet supplies, lawn care, or magazines. Each company is unique to a varying degree.
That is true of the success of subscription-based or membership-based, companies such as (in alpha order) Amazon Prime, AAFRP, Home Chef, HULU, Netflix, New Yorker, The New York Times, Smithsonian Institution, and SPCA.
Stu McLaren has written a book in which he explains how and why almost any business can become and remain very successful after transforming itself from one-off sales to recurring revenue from memberships and subscriptions. Think of it as automated profitability but only so long as quality of product and/or service and delivery thereof are of very high quality, and, customers become and remain what Jackie Huba and Ben McConnell so aptly characterize as “evangelists.”
Automation is cost-efficient insofar as systems are concerned but the human element cannot be neglected or underestimated. All of the major studies of customer satisfaction are based on research data generated by surveys that ask respondents to reveal what is of greatest importance to them. In most of these surveys, “feeling appreciated” was ranked either first or second in importance by a majority of respondents. It is also worth noting that adding a new customer costs about six times as much as retaining a customer.
McLaren fully understands all this and a great deal more. He wrote Predictable Profits and then asks you:
o “Is there an ongoing problem my market is looking to solve?”
o “Is my market looking to learn a new skill”?
o “Is my market looking to simplify something in their life”?
Then he asks: “Did you answer yes to any or all of the three questions? If you did, this is your signal to go for it full steam. Memberships will work for just about every market. With your idea now affirmed and some speedy research under your belt, you can confidently move forward.”
Throughout Predictable Profits, McLaren provides an abundance of information, insights, and counsel that can help you to achieve these strategic objectives:
o Decide whether or not to adopt/adapt a subscription/membership-based business model
o If you decide in favor of that model, formulate a cohesive, comprehensive, and cost-effective business plan
o Implement it, with frugal expenditures while creating/increasing demand for your offering
o Refine the plan (e.g. tactics, scaling) on an as-needed basis
With all due respect to the success of subscription-based or membership-based, companies such as (in alpha order) Amazon Prime, AAdvantage® program, AARP, Home Chef, Hulu, Netflix, New Yorker, The New York Times, Smithsonian Institution, and SPCA, adopting/adapting the subscription/membership model does not guarantee success BUT it may be the most appropriate model for the given offering.
Of course, if what you offer has insufficient appeal, no model will be successful.
Amazon now sells a hardbound edition of Predictable Profits for about $25. That’s a small price to pay for expert advice that will prepare you to make the right business decisions in weeks and months to come.