Sam Jordan is keen to avoid the conflation of membership businesses with subscription businesses. The EVP, Media and Membership at Manifesto Growth Architects (MGA) admits that there are certain areas of overlap between the two, and is alive to comparisons with sharing economy businesses. Both contain elements of what he has fleshed out in a new report, How to make money in the Membership Economy.
As it happens, there’s great interest in subscription models, MGA finds. From the report: “we ran a quick survey and 70% of businesses said they thought “membership and subscription models were the future commercial model in their sectors; however, only 10% of them are currently employing these models”.
Companies that fit in this model, Jordan explained at an event launching the report, are defined by “an ongoing relationship, based on experience, based on selling stuff, driven by engagement as opposed to transaction and which delivers value over time”. This is where the definition starts to get murky. In the report, Netflix, the subscription-based video streaming platform, fits into this definition, for example, but so does Amazon, though its model of membership goes far beyond video.