Exploring Paid Membership: How Paid Members Differ from Your Normal Customers

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If you are a frequent customer of a supermarket, bookstore, clothing store, or online shop, you’ve probably been offered a membership card at least once. As a customer, buying one may seem like a useless expense, but from a business’s perspective, it is a genius strategy that will benefit you and the establishment.

Offering private or paid membership is a common way businesses gain customer loyalty. People who bought a membership slot will automatically become entitled to certain perks, such as calling dibs on a product soon to be released, receiving additional discounts, or enjoying extra services like lounge seats in an airport or exclusive restaurant.

The perks and privileges enjoyed by paid members are all thanks to reliable membership management services, which a company pays for to ensure that their members are getting their money’s worth. If you’re also thinking of running a business in the future, you should definitely consider such a service, because it will handle all your materials, such as membership cards, welcome packages, and more.

But how do memberships generate high revenues, if the business is spending more?

Some Perks Require Little Spending from the Business

You don’t necessarily have to provide luxury for your exclusive members. Some businesses only increase their members’ loyalty points, which become redeemable once a certain number is reached. For example, if a customer manages to accumulate 500 points on their membership card, they may use it to purchase an item of the same price or to get a special discount on selected items.

Some online retail stores may offer 24-hour delivery services to their paid members. Though it incurs an additional expense for the company, they get back their money from their members who prefer to receive their orders outside business hours. Considering that a lot of companies now allow flexible working hours, you’d surely have customers who order products in the middle of the night.

Membership Programs Can Encourage Higher Customer Spending

Of course, businesses will not offer exclusive rewards if they won’t get anything bigger in return. You can structure your membership program to encourage higher spending from your customers. Such is when you offer exclusive perks or discounts when a customer spends a certain amount. The loyalty points example above is also similar to that because for a customer to gain higher points, they would have to spend more.

Some companies offer different categories of membership to customers who will commit to spending a specific minimum amount regularly. For example, you may offer bronze, silver, and gold memberships. Bronze members must spend at least $50 every month, silvers $100, and golds $150. Spending less than the agreed amounts for a certain period (e.g. 3 months) automatically revokes the customer’s membership.

Business Can Trace Their Members’ Spending Patterns

If your membership has a magnetic strip, it enables your computer to capture the data from the card, such as the customer’s buying history. From there, you’ll be able to trace their spending patterns and preferences. These data will help you understand your members better, and allow you to offer personalized perks and privileges for them. For instance, you may offer one member discount vouchers for their favorite items or services to purchase.


Examples of Effective Retail Membership Programs

1. Restoration Hardware

Restoration Hardware customers may pay $100 every year for amazing benefits that include a 25% discount on all items, 20% on sale items, and concierge and interior design consultations. These benefits are perfect for customers who are remodeling their homes or building new ones.

2. Walgreens

The famous Florida drugstore started a membership program called “Walgreens Plus” for a very affordable price of $20 a year. Walgreens Plus is available in 17 locations only, and members are entitled to a 20% discount on almost all items, including the ones on sale, plus up to 60% off on prescription drugs with free same-day delivery.

3. The Bike Shed

Motorcycle fans will rejoice in The Bike Shed’s membership perks. They will be entitled to up to 20% discount on store and restaurant items, plus free entry to shows, and the permission to buy drinks without accompanying food.

4. ClassPass

ClassPass membership program isn’t like any of other gyms. Its fitness members aren’t tied to a specific gym or location, but to any of their studios worldwide. So yes, members can search for classes near their area, try out various classes if they don’t wish to commit to a single routine, and continue their workouts even when they are traveling.

5. BLOK London

Another fitness company, BLOK London offers its paid members workout classes and hangout spots in their cafe, gallery, and retail spaces. The idea is to make fitness fun and recreational, as opposed to a chore that you have to finish quickly.

These top examples of retail membership programs may spark an idea of what type of perks and privileges you can offer to your future customers. But more importantly, think of a service or benefit that you enjoy yourself, and give the same experience to your exclusive members.

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