Why Member Lifetime Value is More Important Than Churn

Are you worried about the churn rate of your membership? Many membership business owners look at the numbers dropping and panic. They might even believe that the membership business model is flawed, and maybe they should try their luck elsewhere. In this episode, I talk about churn rate and why it shouldn’t be the one thing you think about. This episode instead focuses on THE most important metric – customer lifetime value, and why that should be your focus before you make any decision about the future of your membership. If you’re considering switching from a membership model, listen to this episode first.Essential Learning Points:Why people get worried about churn rateWhy there’s no industry average churn rateHow to look at churn rate with contextWhat lifetime value is and why it’s the most important metricImportant Links & Mentions:The Membership GuysMembership AcademyDespite What You’ve Heard, Average Member Retention is NOT Only 3 Months5 Stages of the Member Life Cycle 21 Quick Tips for Improving Member RetentionThe Most Effective Tools for Reducing Membership ChurnKey Quotes:“The lifetime value for courses max out on day one.”“The idea of lifetime value of your customers maxing out is not exclusive to memberships.”“It's important to realize that whatever model you go with for your business, whatever type of business you run, it all essentially comes down to customer lifetime value.”“Anything you sell has a churn rate. Churn rate is merely a factor in determining the endpoint after which you get no more money from that person.”