Four ways to unlock new revenue streams
Friday, November 4, 2022
It’s no surprise that the ultimate measure of business success boils down to your bottom line. That said, it’s imperative to understand the opportunities to explore new revenue streams to genuinely move the needle and drive lasting business impact.
Here are four ways to unlock new revenue streams.
The brilliance of this revenue stream is that it emboldens customers to come back for more and fuels lasting brand loyalty. In this scenario, brands entice customers to try and buy by offering a free version of the product or service. If customers want additional features, the need to increase their level of investment.
If you adopt this scheme as a revenue stream, it’s important to be intentional and strategic about what you intend to offer your target market. The key is to make the freemium offer exciting, timely, and exclusive, so it’s too good to pass up. The freemium features should be enough for customers to understand the value, and how it positively impacts their life, so they’re encouraged to purchase the full product or service later.
2. Time investment
Most coffee shops and cafes make revenue by selling food and beverages. But in some cases, it may make sense to adopt a novel revenue stream. For instance, two European coffee chains, French AntiCafé and the Russian Ziferblat, charge their customers for the time spent inside their shops. Once you’re seated, you can consume as much food and coffee as you want.
This structure applies mostly in places where rent is the main driver, such as Paris and London. These shops have gained massive success by offering hourly, daily, weekly, and even monthly packages.
3. Fractional ownership
Most items are purchased and owned exclusively by one person. Yet, in today’s digital-first world, there’s heightened appetite to reimagine the definition of “ownership.” For instance, with fractional or shared ownership, you might own a yacht or vacation home with a group of friends, and create a rotating schedule for who will use these items, and when.
4. Subscription and membership
This is by far the most popular revenue stream. Subscription models are incredibly effective, especially when you provide members with exclusive perks, incentives, discounts, and special events. Costco is the master of this model. Gyms, boutique fitness studios, golf clubs, wineries, and special interest subscription boxes have also had significant success with this approach, ensuring a steady and consistent cash flow.