January 4, 2024
The Subscription Playbook:
How to Build a Rock-Solid Recurring Revenue Stream
Robert Coorey
Aviva Publishing (2022)
ISBN: 978-1-63618-240-7
New Book Advocates Subscription Business to Build Revenue and Loyal Clients
In The Subscription Playbook: How to Build a Rock-Solid Recurring Revenue Stream, Australian entrepreneur Robert Coorey reveals that a subscription-based business is the way to go if you want to build a solid base of clients who will keep coming back to you so you aren’t worried from day to day if you will stay in business.
Coorey knows from experience that a subscription business provides stability and peace of mind for the business owner. He once owned a “results-based agency” which had highly irregular income. If you have a business where you rely on customers but they only need you once or irregularly, you risk having highs and lows and even going out of business. A subscription-based business, however, provides a steady stream of income from multiple sources.
Examples of subscription-based businesses abound, and Coorey discusses many of the best-known in this book, including Netflix, Amazon Prime, and Dropbox. They all have customers who subscribe on a monthly or yearly basis and in exchange are offered a wide range of services or products to choose from. To be successful in business, you need to do the same, and Coorey is here to show you how. Coorey also shares examples of little-known small businesses benefiting from the subscription-based model.
Coorey has spent years studying how subscription companies establish competitive advantages and make themselves more valuable. For example, the camera company GoPro has added a subscription service that allows users for a small monthly fee to have unlimited cloud storage. Users immediately jumped onboard because high quality images require higher storage levels. In 2020, the year it launched the service, GoPro acquired 750,000 subscribers, and since then it's added a million more. Of course, more obvious examples include all the video streaming services that have become available in the last decade, including Netflix, Amazon Prime, and Disney+.
You might not have a video streaming service, but there are plenty of other ways to implement subscription strategies into your business. That is what Coorey has done with the business he co-founded, Archistar, which has raised more than $30 million in venture capital funding in just a few short years and was listed as the twentieth fastest-growing company in Australia by the Australian Financial Review (the Australian equivalent of the Wall Street Journal) in December 2021.
Coorey states that Archistar’s success comes down to two factors: a subscription-based business and a strong moat. The moat is what you do to protect your business. While a subscription business will bring you recurring revenue, you need to protect that revenue by building a moat strong enough that your customers won’t want to go elsewhere. There are many ways to build that moat, and Coorey explores them all, giving many examples of moat elements and subscription businesses.
Getting down to the nitty gritty, in Chapter 2, Coorey describes eight subscription models you can choose from. In Chapter 3, he offers five pricing models to consider for your subscription business as well as how to mix and match them. He illustrates this point by showing how Amazon has combined all five models to generate its revenue. One pricing model is usage-based pricing. Coorey discusses the pros and cons of usage-based pricing and the four factors to keep in mind to make it work if that’s the model you want to use. As far as building a moat, he discusses strategies such as how to make it difficult for customers to leave, which could include switching costs—not a fee for leaving, but a realization that if they have to reinvest in another company’s products that are not compatible with your products, it is more trouble and expense than it is worth, so they will stay with you.
Going a step beyond illustrating various models and options, Coorey provides readers with access to his website where he has a free resources page with tools to help readers determine which subscription business and pricing model is the best fit for their individual businesses.
Coorey also demonstrates how network effects can become your company’s secret weapon. Network effects happen when a company’s service becomes more valuable as usage increases. For example, the real estate company Trulia saw this happen. Once potential buyers started using Trulia’s search engine, real estate agents began getting more inquiries, which encouraged them to list more properties, leading to added value and growth. Coorey then discusses the six major types of network effects and how you can apply them to your business.
Of course, getting paid and making a profit are a major concern for any business. Coorey demonstrates multiple ways you can do both, using real examples. Uber facilitates transactions on its platform. eBay and PayPal get a slice out of every sale. These are all ways a business can learn to monetize to support the bottom line. With a little forethought, it’s obvious any business can apply one of these subscription and pricing models. It’s hard to imagine any business wouldn’t think a subscription model is the way to go.
The Subscription Playbook is full of more insightful and invaluable information. Other topics include the concept of “land and expand,” how to minimize churn and maximize usage, and how to grow your client numbers on a shoestring budget. Even if you already have a subscription business, this book can help you take it to a new level of growth and help you build that moat to protect what you already have. I hope you will subscribe to the recommendations of The Subscription Playbook.
For more information about Robert Coorey and The Subscription Playbook, visit Amazon.
— Tyler R. Tichelaar, PhD and award-winning author of The Nomad Editor: Living the Lifestyle You Want, Doing Work You Love
