Have you ever thought about creating a recurring revenue stream?
Well, you’re in luck!
The revolution is upon us, the recurring revenue revolution, that is.
It began when Blockbuster went extinct at the hands of Netflix, and it hasn’t stopped since.
Today, businesses of all kinds are leveraging monthly and annual recurring revenue models to create consistent, scalable income.
This guide is an introduction to the vast applications of recurring revenue.
You’ll discover why recurring revenue can work in almost any industry, and why you’re business will probably get left in the dust if you don’t incorporate it into your current model.
So…what the heck is recurring revenue anyway?
Note: This in-depth guide on Recurring Revenue Ideas is 9,600+ words long, so you can check the table of contents below to jump to the section you’d like to dive in to more (and be sure to bookmark this mega resource as well).
What Is Recurring Revenue? (And What It Isn’t!)
Recurring revenue is any product or service that customers purchase on a predictable basis.
Think of subscription-based services where customers pay monthly or annually for an on-going service.
This system makes it easy for companies to calculate accurate ROI projections and to reduce the amount of time spent hustling up new clients.
Creating a membership site is one of the most effective ways to add recurring revenue to almost any business.
Some well-known examples of recurring revenue include:
- Streaming services (Netflix)
- Hosting service (Bluehost)
- SaaS (software-as-a-service, like
Recurring vs. Non-Recurring Revenue
Businesses love recurring revenue because it’s stable and easier to scale, and customers love it because they get more bang for their buck.
Non-recurring revenue, on the other hand, depends on one-off sales with no promise that customers will return.
This type of revenue usually depends on a proactive marketing strategy to make sure that new customers keep coming in.
Examples of non-recurring revenue:
- Grocery store (Whole Foods)
- One-off ticket sales (Ticketmaster)
- Short-term housing (AirBnB)
Spotify’s impact on the music industry is a perfect example of the epic battle of recurring vs. non-recurring revenue.
Spotify’s impact on the music industry is a perfect example of the epic battle between recurring vs. non-recurring revenue, and recurring revenue keeps coming out on top.
There was a time when music used to be sold one album (or song) at a time.
Even after music went digital, Apple was still selling songs and albums individually rather as a subscription.
Spotify, however, had more creative plans.
They cut a deal so that they could rent unlimited songs to their subscribers for a recurring monthly fee.
As long as customers keep paying, the songs keep playing, and music lovers around the world subscribe in the millions.
But monthly recurring revenue isn’t just for big companies like Spotify — local businesses are getting in on the action too.
Recurring Revenue Businesses Are All Around You
Believe it or not, the recurring revenue revolution has already gobbled up most of the world, and if you haven’t noticed, it’s probably because you’ve been living in the belly of the beast for so long.
Your everyday life is already full of recurring revenue businesses.
Amazon Prime is yet another “prime” example, but recurring revenue is just as common with small local businesses.
Your Local Juice Bar
Even traditional brick-and-mortar stores are getting in on the recurring revenue action.
I interviewed membership site expert Stu McLaren recently, and he told me a story of a juice bar he visited in San Francisco.
He was walking through the mall and popped in for a drink.
Off to the right, there was a little section of the menu that read “membership pricing,” and the way it works is that members pay $10 a month for two free green juices, and then every drink thereafter is at the member price of $5 instead of $6.50.
It’s a great deal for members and an even better deal for the juice bar because it almost guarantees loyal return customers.
Watch the full interview with Stu here:
Your Local Massage Studio
Massage studios have been picking up the baton, like Mary-Claire Fredette who came through Stu’s
Her massage business was suffering from sporadic cash flow, and she needed a way to increase her average monthly income, so she decided to launch a membership site.
Mary-Claire got 17 people to sign up for her launch with just a small email list.
That’s at least 17 people coming in every single month for a massage, and many of them were upgrading to 90-minute massages.
Right now is a great time to start creating a recurring revenue stream.
Stu’s FREE TRIBE Workshop is the perfect compliment to this article, and it only happens once a year.
You can tune in now through May 6th, but after that it closes for another 365 days (currently closed).
You can also check out my detailed review of Stu’s full
I’m currently going through Stu’s program, and I’m excited to use it to create a membership site to serve my audience in a deeper way.
Your Local Car Wash
Stu shared a story on recently about a car wash across from his office that uses a membership program.
You can either go through the car was once for $11 or get an unlimited number of car washes for $12 a month.
Sounds like a no-brainer to me.
Stu has a membership for his and his wife’s car, and now that one car wash has his family’s business indefinitely.
While most car washes around the city hope and pray for customers to come back, Stu’s car wash is worry-free.
Want to hear more from Stu about the power of recurring revenue?
Sign up for his FREE
The Benefits Of Recurring Revenue
The time is ripe to start a recurring revenue business.
Membership businesses are all over the place, and people are already accustomed to paying on a monthly basis for the products and services they love.
For instance, if you take a look at your credit card bill, most of the charges on there will probably be recurring services.
By adding your business to that list, you’ll enjoy some pretty awesome benefits:
How Recurring Revenue Benefits Your Business
Here’s what you and your business have to look forward to when you adopt the membership model:
1. Predictable income
The people paying for your service this month are more likely to continue paying next month.
It’s always easier to sell to your existing customers than it is to convert new ones.
2. Higher customer LTV (lifetime value)
You’ll make more money off of each customer over their lifetime.
This gives you a higher ROI on the money you spend on advertising and marketing.
Plus, you’ll have more time to focus on customer retention.
3. Stable metrics
Future income will be easier to predict, making it easier to calculate the value of your business.
4. Scalable income
Many recurring revenue businesses, like membership sites, make it possible to stop trading your time directly for money, and that means you can scale your business a whole lot faster.
5. Impact more people
Recurring revenue allows you to take on more customers.
No matter which industry you’re in, you can have a bigger impact.
6. Low stress
Recurring revenue takes away the stress of revenue woes.
Memberships can guarantee that you’ll stay profitable from one month to the next with predictable monthly payments.
7. More time to improve your business
With one-time revenue, you have to put a ton of time into marketing and promotions every month.
But with monthly recurring revenue, you can just keep selling to the same customers and have more time to spend improving your product.
8. More time to do the things you love
Let’s face it, you have better things to do than constantly figuring out how to drive more sales.
The extra time you gain from recurring revenue can be used anyway you like.
Spend more time with your family and enjoy life.
How Recurring Revenue Benefits Your Customers
Here’s what your customers have to look forward to when you adopt the membership model:
1. More bang for their buck
CD’s used to cost $15 a pop, and monthly subscriptions to a magazine weren’t any cheaper.
Today, you can enjoy unlimited listening from Spotify for less than $10 a month, and for the same price, you can get access to over 300 popular magazines and newspapers with Apple News+.
My how times have changed.
2. Higher quality products
Thanks to recurring revenue, businesses get to spend more time developing high-quality products at a lower price point, and customers reap the rewards.
3. Customer feedback that actually gets listened to
Most companies have a some system in place for taking in customer feedback, but how much of it actually gets listened to?
Recurring revenue businesses, like membership sites, thrive on customer feedback.
In fact, membership sites that don’t actively seek customer feedback and make rapid improvements usually don’t last long.
4. Belonging to a
Membership programs give customers the feeling that they belong to a
With a yoga studio membership, for example, members develop a bond with the classes, the instructors, each other.
The sense of camaraderie is great for retention.
The 5 Biggest Misconceptions About Making Recurring Revenue Online
My guess is that recurring revenue is starting to look pretty darn good, but if you still have some doubts, I understand.
The good news is that the biggest misconceptions about recurring revenue have simplest solutions.
Here’s the truth about the challenges of building a recurring revenue stream online:
1. Not an Expert
A common misconception is that you have to be at the top of your industry to start a membership service, but think again!
You can always leverage the knowledge of industry experts by hosting virtual events.
So you don’t have a Ph.D. on intermittent fasting…big deal.
Mitch Asser didn’t either, and that’s why he repurposes his virtual summit interviews for the core content of his membership site.
Mitch was a personal trainer before he started Fast Way To Health, but he wanted to beef-up the credibility factor, and hosting online summits was the perfect solution.
He’s able to deliver great results by packaging the interviews so that the content feels like an online course.
2. You’ll Need To Make a Ton of Content
One of the biggest misconceptions about offering value online is that you need a ton of content, when the truth is that people prefer bite-sized pieces of actionable advice.
Now, what if I told you that you could produce 6-8 months of content in less than a week?
This is exactly what best-selling New York Times author Michael Hyatt did for his Platform University membership site, a joint project with Stu.
Michael’s a busy guy, and at the time he was speaking on the road 100 days out of the year, writing weekly content for his blog, and making money podcasting.
So he and Stu decided to batch-produce video content in three 2-day sessions — enough to last 6-8 months.
Stu teaches the same process in his
Watch Michael tell his membership site success story here:
3. Too Much Free Content in My Market
What if there’s a ton of free content in your market?
Does that mean that nobody will be willing to pay for your knowledge-based service?
Nope, it actually means the opposite.
When there’s plenty of free content on a subject, it means that the industry is thriving.
It also means that people are most likely overwhelmed with information, and that’s where you and you membership service come to the rescue.
The thing is, people are willing to pay for speed and convenience.
If you can deliver real results and save your members from the hassle of hunting down trustworthy content, they’ll keep coming back month after month.
4. Small Following
And then there’s the age-old misconception that you need to build a huge email list before a membership site launch.
Are you worried that a recurring revenue business only works if you already have a big following?
Well, don’t be.
The truth is that you can crush it with a small email list.
In fact, small targeted lists tend to have higher conversion rates than larger ones.
She was pregnant and in a rush to launch MyOMy Fitness, a kettlebell membership site for women.
So she decided to launch to an email list of only 250 and welcomed 52 members on the day of her launch.
That’s a sign-up rate of 20%!
Then there’s Anna Saucier.
She launched a membership site on extremely short notice to a list of only 326 people.
In just 24 hours, Anna was able to raise $5,024 for a membership site that wasn’t even live, and it’s been growing ever since.
Anna was a member of Stu’s TRIBE Course as well, and she actually did her 24-hour fundraising sprint while attending one of his live events.
Watch her case study here:
5. No Following
What if I told you that you didn’t need any following at all before starting on your journey to building recurring revenue online?
A single online summit can grow an email list of up to 5,000 or more targeted people.
Augustus Kligys grew his list from zero to 4,500 with his Summit for Amazon Sellers and generated $58k in revenue.
Recurring Revenue vs. One-Time Fees: Two Ways to Make Money Online
Before we dive into some proven ways to make recurring revenue online, it’s important to make a clear distinction between selling one-off info products/services and getting people to subscribe to repeat charges.
This is the difference between building a path towards lifestyle entrepreneurship or continuing to trade your time for money.
The same content that you sell as a one-off product can be turned into recurring revenue — it’s how you package and distribute it that makes the difference.
Here’s how to package your content in a way that retains customers and sets you up for monthly memberships:
- Drip content on a weekly or monthly basis. This gives members a reason to stick around.
- Build a community that members get attached to. It’s perfect for customer retention.
- You’ll also want to create new content to upsell to long-time members.
Now let’s dig into some recurring revenue ideas and find out which ones might be a good fit for your online business.
9 Proven Recurring Revenue Business Ideas
Now that you know why recurring revenue streams have taken over the world, let’s take a look at how you can implement it.
My buddy Stu makes a pretty strong case that with the right strategy, memberships can be used to uplift any business.
He’s helped thousands of entrepreneurs elevate their businesses with recurring revenue
And here’s the thing, it works with brick-and-mortar businesses, online stores, consultants, coaches, info products, and everything in between.
Want actionable advice from the man himself?
Join Stu’s FREE TRIBE Workshop. It’s only available now through May 6th.
Or you can stick around and learn about nine proven recurring revenue business ideas.
1. Recurring Membership Sites
Membership sites, and knowledge-based businesses in general, are on the come up, and there really hasn’t been a better time to get in on the action.
The self-improvement industry is booming, and over the last several years, subscriptions to membership sites have tripled.
The time is ripe for membership sites.
People are crushing the membership site game in darn near every industry, and they’re doing it with less work, lower stress, and minimal content creation.
Offer More Value With Less Content (Say what?!)
What I’m about to say may shock the pants off you.
With membership sites, it’s actually better to publish less content.
This is one of the main secrets to success that Stu shares in his
The truth is that too much content overwhelms members, and overwhelm is the #1 reason why people leave.
Once they feel like they can’t keep up, they bail.
Here are a few insider tips to efficiently create killer content:
- Advice should be actionable and easy-to-implement today.
- Make easy-to-digest, bite-sized lessons.
- Only release one piece of content a week.
- Content should never take longer than an hour to consume.
When you start a blog, it’s easy to get stuck in the loop of cranking out a never-ending stream of content, which can be exhausting, time consuming, and expensive.
Membership sites, on the other hand, operate according to a different rule:
It’s not about the volume of content, it’s about how fast you your members get results,” and that happens best in small batches of well-crafted content.
A Less-Is-More Case Study
Paul Evans, one of Stu’s
His mission is to help youth ministers, and when he first launched his site, he had a whole bunch of different content in the members area, content that took a lot of work to create.
But when he surveyed his members, he found that they weren’t using most of it.
As it turned out, what they valued most took very little time to produce: the weekly bible lesson.
You see, most of his audience juggles pastoring part-time with a full-time job, and the weekly bible lesson offered massive value by saving them a ton of prep time.
Paul was able to strip away 75% of his content and focus on delivering the bible lesson, and plenty of other membership site owners share a similar story.
Skip to the end of this guide for a whole bunch of examples of people succeeding in every niche from dog training to guitar lessons.
2. Recurring Coaching Program
A recurring coaching program is another great way to build recurring revenue online, especially if you combine it with virtual content that you host on a membership site.
As part of a membership site, your one-on-one coaching can be an upsell to your core info-content.
Plus, you can create scalable income by hosting pre-recorded group training sessions.
The key is to get people to renew with an ongoing coaching plan that offers consistent value.
Lock them into recurring monthly payments and let the predictable income flow!
It can be a major lifestyle upgrade compared to making one-off sales and give you the opportunity to design your ideal lifestyle.
I’ve met more than a few digital nomads who make their living as virtual coaches, and they don’t even necessarily have a website.
Instead, they rely solely on influencer marketing and other social media-based strategies.
3. Recurring Mastermind Program
A mastermind is essentially a membership site where the main attraction is the other members.
People are joining to connect with other like-minded thinkers that can help them solve their problems.
The key to a building a high-level mastermind is to be selective about who you accept, because the members themselves are the product.
The more value that each member contributes to the group, the more you can charge for membership.
Benefits of Recurring Mastermind Programs
Masterminds have several major benefits:
- They tap into the “hive mind” where everyone benefits from the collective problem solving of the group.
- It’s easier to retain customers because members develop a bond with the group.
- Members get their questions answered faster.
And then of course there’s my favorite benefit of all, and that’s that masterminds generate significant revenue.
High-level masterminds, like James Wedmore’s Inner Circle, charge up to $40K a year and beyond.
Will a Mastermind Work in Your Niche?
The real question is, “Does your audience regularly have questions that only the collective power of a group can best solve?”
In other words, if a mastermind is the best way to solve your audience’s problems, then yes, a mastermind can work in your niche.
4. Earn Recurring Income From Affiliate Marketing
Affiliate programs are a great way to add additional revenue streams to your business, whether you run a membership site, work as a personal coach, or make money blogging.
Help companies make sales, and they’ll be more than willing to share the profits.
There are affiliate programs in every niche, and some of the most profitable are info products and SaaS tools.
Benefits of Becoming an Affiliate
Altogether, I bring in over six figures annually from affiliate sales, and much of this is paid out as monthly recurring revenue.
For a full breakdown of how I generated revenue did in 2018, check out my annual review here.
But increasing revenue and diversifying your income are just two benefits of becoming an affiliate.
Affiliate programs are also a great way to network with other players in your industry.
By becoming an affiliate, you offer immense value by boosting their sales, and this can be the start of a meaningful professional relationship.
For instance, of the $40K+ I made in the month following my first virtual summit (The Branding Summit), most of which came from affiliate sales of Ramit Sethi’s flagship information product.
I actually did so well that I won an award for being his top affiliate.
Choosing the Right Affiliate Programs
Be choosy about the products and services you become an affiliate for.
Here’s a cheat sheet for deciding whether or not an affiliate program is right for you:
- Offer value to your readers.
- Relevant to the rest of your content.
- Pay you well for the effort you put into promotion.
- High-quality that you can stand behind.
Not all affiliate programs are going to be a good fit, and promoting low-quality products can damage your reputation and burn bridges with your audience.
But as long as the product helps your audience and pays well, it’s worth considering.
A Few Of The Affiliate Programs That I Belong To
I’m an affiliate for several different SaaS and info products, including Stu’s
I’m also an affiliate for Bluehost, and I can say from firsthand experience that they compensate their affiliates well.
One of the first things I recommend that people get when they’re starting an online business is to get hosting for their website / blog.
If you’re using a WordPress website, Bluehost is an excellent low-cost option.
ConvertKit is and email service provider that allows you to communicate directly with your audience.
It’s easy to get started with but is also full of functionalities that grow with your business.
You can also read my in-depth ConvertKit review here.
ClickFunnels is an SaaS tool I personally use for building high-converting sales funnels and landing pages… it’s pretty awesome and I recommend it to my audience.
Click here to read my full ClickFunnels review.
If you’re interested to promote
Deadline Funnel is the best tool for implementing evergreen deadlines and urgency into your marketing funnel.
Read my in-depth Deadline Funnel review to learn how Deadline Funnel can help you rapidly increase your revenue.
Whichever products you decide to become an affiliate for, just make sure to only recommend high-quality services that add value to your audience.
5. SaaS – Software as a Service Subscription
SaaS (software-as-a-service) is any software that’s sold as a subscription.
While it takes a lot more startup money to create an SaaS product, if it provides a much needed solution to specific problem, the payoff can be huge.
Try to diversify your recurring revenue stream with upsells like set up fees, extra storage, data, speed boosts, API’s, and white label licensing.
6. Create Service Plans or Retainers
Many online businesses offer products and services that require regular renewal.
It makes good sense then to set them up with an automatically recurring subscription rather than trying to make another sale at the end of each month.
Offer recurring stand-alone services and packages that automatically renew every month.
One Click Influence is a great example of a recurring revenue service plan.
They’re a link building and SEO company that sells everything from monthly link rentals to all-inclusive SEO packages built from the ground up.
What’s key is to have services to upsell to loyal customers, like One Click does with their dedicated SEO Rep package, where you can have a dedicated SEO consultant assigned to your project.
WP Curve is another great example.
They provide 24/7 WordPress support.
Copywriting services are another booming industry, where companies like Presto Media provide recurring content management and content production solutions to larger businesses.