Subscription Options

May 14, 2009

Subscription or Membership

The business I presently work for is a national engineering firm. We service clients all over the country of Australia. I am part way through changing some of the way we sell our services. Instead of a pay per use approach, we are moving to a membership type service. 

The service is metallurgical analysis and we are moving to an "all you can break!" model. 

Before we went to this approach they had to make a decision every single time they used the service. As a result they used it very selectively, and they allowed a lot of items to go through without failure analysis. 

This meant not getting to the root of the problem and leaving themselves open to repeat breakages. (And in some of the industries where I work that means some pretty large scale losses)

So it seemed to work for everyone...but as an added extra we added a best practices group. A group where the metallurgists got together with the user group of representatives and actually helped them with some leading practices for avoiding some of the problems they see regularly.

It has been a great success. Instead of making a decision every time, they make one decision a year. Instead of our people scouting for work continually they now get a steady stream of work from the club, and instead of allowing lots of items to fail without knowing why they are now able to make better use of the failure analysis capabilities. (And that means a lot of cash money in their pockets)

Some months they use far more than they pay for, other months they don't turn up at all. It balances out well so far. 

This is the difference between a subscription model, such as maintenance for software, and a membership model.

I subscribe to Seth Godin's RSS feed - but I am a member of his group called Tribes. Subscription seems to represent a one sided relationship. We try to get a two way thing going through blog comments but it is really about people reading the feeds as they come to them. 

Membership implies a two way thing. Giving and receiving, interacting with and contributing to. Not just taking. 

This is why we set up the "All you can break" model the way we did. We give them unlimited service for a limited fee. And then we all get together every so often to discuss leading practices and share information. 

How can your service become a club? 

The underlying techniques are the same all over the world. A basic underlying service, an additional component (the sum of the parts being greater than the whole) and mechanisms for people to interact with one another. could easily anonymize some of their client data and produce great leading practice stuff on time between stages and who knows what else. And they should be hilding the worlds largest forum, discussion board for sales people the world over. But they aren't. 

I wonder who will...