MBA956 How to Turn Monthly Subscriptions into Annual Subscriptions

Hey O. Welcome to the $100 MBA Show. Because you don't have time for useless jibber jabber. That's why we go straight to the business strategies you need with our daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of the Hundred Dollar mba, a complete business training and community online over at one. And in today's episode you will learn how to turn monthly subscriptions into annual subscriptions. If you offer a reoccurring service or product, whether it's a software, an online course, a community or even coaching. How do you take those who are on a monthly plan and move them to an annual plan? How do you sell them on the benefits of going annually? Getting people on your annual plan is really essential to keeping churn down. Customers on annual plans are less likely to turn to leave you because they have to make that decision only once a year versus having to make that decision every single month. You have to earn their business every single month. So in today's episode I'm going to share with you some strategies to show those customers that are currently paying monthly how it's beneficial to them to upgrade to annual. We got a lot to cover, so let's get into it. Let's get down to business. Today's episode of the $100 MBA show is supported by the Jordan Hart Harbinger Show. This is Jordan Harbinger's all new podcast and it's a huge hit. Jordan teaches everything from what you do in a crisis, how to cultivate resilience and grit, how to handle uncertainty and instability, and how to protect your mindset so you're always performing at the top of your game. Every episode is loaded with practical insights and material. So if you love this podcast, you will love the Jordan Harbinger Show. Subscribe today on itunes, Stitcher, Overcast, whatever you use to listen to podcasts, this has become one of my must listen podcasts. Subscribe to the Jordan Harbinger Show. Before we get into the details of selling the idea of going from monthly to annual to your subscribers, we have to establish a fact. And the fact is that we all work on incentives. We are motivated by incentives. So if somebody doesn't see a benefit in doing something, they're just simply not going to do it. So it's very important for you to break down to the person that you're selling to. Hey, this is why this is a good idea. Now immediately people think savings, savings is a great incentive. You'll save some money. But there are other incentives you can give them for going annual. A bonus, extra features, maybe a sneak peek or early access to features only available to annual subscribers. So just keep that in mind. We all work on incentives, so think of some incentives you can give when you're actually offering them to upgrade to annual. So we talked about savings. Let's talk about roi. Return on investment. They save more money. They're going to have more of a return on investment, meaning that they have less cost, more return. So one of the easiest ways to move somebody from monthly to annual is to target your monthly subscribers that have been monthly subscribers for some time. For example, if you email every single person that has been a monthly subscriber of yours for over a year, you could show them, hey, you've been a monthly subscriber. You've been paying X amount of dollars every month. This equals X amount of dollars for the year. If you go annual, you could save X amount of dollars. They've already spent a year's worth on monthly. So they can see, oh man, if I go annual, I can save so much money. And usually the annual price is about 20% less than the monthly price is significant. And they've already gone through it. And there's a likelihood they will go through another. You're paying monthly not knowing the savings. A lot of people just don't know their savings. And by just letting them know they will upgrade. And also it hits home a lot more than somebody who's only been a monthly member for one month. They've used your product, they've had it for month after month, they're sold on it. So when you tell them, hey, you can save some money for the next year you're about to subscribe for instead of go monthly, go annual. Now you can automate this process. You can have an email go out to monthly subscribers that have been monthly subscribers for X amount of months. Let's say nine months. You've been a monthly subscriber for nine months. You're going to get this offer to upgrade to annual because you're going to save some money. And you could do this through email marketing software with Automation, whether using Mailchimp, ActiveCampaign, Infusionsoft, doesn't matter. They all kind of do this kind of thing where they can filter. They're going to have some questions and let them know. If you have any questions, I'd love to answer them. I'll show you how you can save even more money or whatever it is. This is a decision they may have some questions about. So make sure you're available to answer those questions. Number two, incentivize them by locking in a price. Now if you're a growing business, whether you're selling software, you're selling consulting, you're selling, you know, coaching, your prices should be going up. So when you're around that time, we're about to raise prices, say a month before you raise prices. That's a perfect time to tell your monthly subscribers, hey, we're raising prices. Now, your monthly price is not going to change because we grandfather people in say, for example, but the annual price will go up. Right now you can get it at the low price that it is now. And by upgrading, you're going to save 20% in the long run. If you decide to go annual later, you're going to pay X amount more. Sometimes having a sense of urgency really helps. And this deal ends, you know, let's say in two weeks or whenever you're raising prices, let's say a month. The point here is that they know that, hey, the prices will go up. I should should go to annual wallets low. And that's a great incentive to upgrade to annual. Now the reality is that sometimes people stay on monthly because, hey, it hurts too much to pay a bigger amount at one time. A lot of people sign up for monthly because it's a lower barrier of entry. It's a lot easier to pay $27 a month than pay, let's say $260 in one shot. So to ease that transition, you may want to offer another additional discount. Yes, it's discounted already when they go from monthly to annual, but you may want to give them a coupon code that saves them 15%. So now instead of paying 260, they're paying something like 220. That's not too bad. That's closer to 200. And they feel like, hey, this coupon code is valid for X amount of days. I should grab this deal. Sometimes people just need a reason. They have a discount. That's a reason for them to upgrade. Now mind you, not everybody is going to upgrade. And when you word these emails or these offers, you got to be very careful. You got to let them know that, hey, this is just an offer. This is something I want to present to you if you're interested. If you want to remain monthly, you can make sure they know that their plan, their pricing is not threatened in any way. Some people just want to stay where they are. They like the monthly and that's Their jam. Even if they've been paying monthly for three years, that's their preference. That's how they work. So I don't recommend you pressuring people with email after email after email to upgrade to annual, but you can incentivize them by giving a discount and saying, hey, give them a little nudge if you want to save some money. Here's an offer. If you want to stay on monthly, no problem. Now, I mentioned bonuses before. Let me let you in on a little trade secret. When we run our live webinars to give demos and give workshops with webinar Ninja, we often offer a special offer for those who are getting started, they want to get started. With Webinar Ninja, we give a special offer. And that special offer includes some bonuses. I mean, we give away some serious bonuses worth twelve hundred dollars. And sometimes people on that webinar are already members and they're like, hey, I love these bonuses. I would love to have them now we have these bonuses in place to or encourage people to become new members. That's how we can stay sustainable as a business. And we make that clear to current members that this is for new members. But if you want these bonuses and you're currently a monthly member, upgrade to annual and we'll give you the bonuses. Many people do that and they say, wow, I would love these bonuses. I was thinking about buying that bonus, that course that you sell for $500. I'll upgrade to annual and get those bonuses. So that's one way to do it. So sometimes bonuses motivate people, and that's how we do it with our webinars. And on the webinar, I actually explain what each bonus is. I can give a demo, I can show them all around. It's pretty cool. I have one more tip when it comes to having more annual customers versus monthly. But before that, let me give love to today's sponsor. Today's episode of the $100 MBA show is brought to you by Microsoft Surface. Want power in your hands? You got it with the powerful new Surface Pro. This laptop has a long battery life that lasts all day, so you can run the programs you need. It's all so you can get more done when you're working on your passion projects around town. The Surface Pro goes wherever you go, because at under £2, it's light and fits in your bag. It has a touch screen with great resolution so you can work however you want. And it works with your iPhone. Plus, its keyboard comes in a bunch of new colors. The new Surface Pro is the lightest, most powerful surface pro ever. Alright, one more tip. If you want to get more annual customers than monthly customers and it's pretty simple, don't offer monthly subscriptions anymore. You could do that. You can actually stop offering monthly for a period of time where the only option is annual. It may be worth testing. If people really want the tool and you offer some sort of trial or money back guarantee, they'll happily sign up. Often when they're given options, they just choose the option that's better. But if there is no option, they'll just choose what they got and you might find you have more revenue, more retention, less churn if you just can the monthly option for a while to test it out. Now, you don't have to do this forever. You can do it for a month and see how it goes. And I've seen businesses that had monthly removed. It only had annual and then went back to offering monthly. So you gotta test it out. But it may be an option for you. I would say this is particularly effective if your product, your service, your program is integral to their business. They need it so they can run their business. They need it so they can be a good entrepreneur. They need it to be successful. Alright, that wraps up today's lesson. Hope these tips of moving people from monthly to annual has helped try them out in your business and let me know how it goes. You can email me@omar00nba.net and let me know of your results. I would love to share them here on the show. Alright, that's it for me today, guys. Thank you so much for listening to the $100 MBA show. Before I go, I want to leave you with this business is a lot of experimentation. You got to experiment, you got to see what works, what doesn't. And the only way you know what works for your business is to try. Don't worry, nothing is irreversible. You can change things if you see that they're not helping. But you won't know for sure unless you try. So you got to give things a shot. You got to experiment and you got to document your results what happened in your experiment so you can review them later and have them as a reference for the future. All right, thank you so much for listening. Don't forget to tune in tomorrow, free ride Friday and we'll be teaching how to spend less on travel whether you're traveling for business or pleasure. Hey, you got to work hard and play hard. Make sure you hit subscribe so you don't miss that one. I'll check you, then take care. Of sam.