Say it with me… Recurring Revenue

recurring-revenueNote: I'm going to talk about recurring revenue in the context of WordPress, but the application of a recurring revenue model applies beyond that context.

WordCamp San Diego

I can't tell you how excited I am about WordCamp San Diego this coming weekend. Part of why I'm excited is because of our Sunday track. It's a dedicated business track. If you've never been to a WordCamp, it's a local gathering of WordPressers – from users to designers to developers to vendors who participate and support the community.

Normally it doesn't really address much of the business side of things. I say normally, but it's not a hard and fast rule. In fact, over the last few years, we've seen more and more sessions introduced that are business-focused. But they've stood out. Been a one-off. And this time there's an entire second day, Sunday, track with presenters just focused on practical business topics.

Trial & Error Learning

The reason I'm so excited about the business track is because the WordPress community, from a business perspective, is still relatively young. Many great companies in the space are celebrating their fifth anniversary. And if you talk to them directly, you'll hear them share the strategies they used to get to this point in their journey – trial & error learning.

Now, there's nothing wrong with that, and I respect what they've done. But just like so much of the community is focused on sharing and educating others, we should be educating the next set of entrepreneurs so that they don't have to be doomed by the same trial and error learning that others have had to suffer thru.

Recurring Revenue = Good

Which brings us to my main topic today which is recurring revenue. Recurring revenue isn't a complex phrase – it simply suggests a longer-term relationship with a client beyond a single transaction. Instead, the relationship continues because the pricing model isn't a one-time deal. Instead, it happens at regular intervals (monthly, quarterly, yearly).

Here's the thing I love about recurring revenue. It's easily predictable. And predictable revenue is good. It lets you plan. It helps you invest in future efforts. It provides what you need to pay your support.

Predictable and constant revenue allows you to offer something most customers really want: support and an engaging experience (beyond the sale).

Lifetime Developer Licenses = Not Good

Now, if recurring revenue is good, then one-time revenue must be it's opposite (not so good). And yet, that's where many theme and plugin developers start. They build an initial version and invite others to check out their offerings.

Normally the early version of a lifetime developer license offers three things:

  • Lifetime of Use
  • Unlimited Use across Sites
  • Lifetime of Support

And let me say personally, I love it. I've purchased many awesome plugins and themes that way. And I even get why developers do it.

What you're looking for is your initial market and first set of customers that will act as references. So you think you have to give them the moon in order for them to talk to others about what you're doing.

But you're wrong.

What Customers Really Want

The reason I say you're wrong is because for as much as we all like free and low-cost stuff, customers want two things more than all of the above:

  • Useful Product that's Supported
  • A Vendor that Stays in Business

This past weekend a new vendor (to me) appeared with an incredible new product. Did I want unlimited licenses forever at a ridiculous price? Sure. But what I wanted more was to know that if I bought it this weekend, they'd still be around to support it in a year. And there's no way they could do that if they were giving it away at ridiculous prices.

So when I got their launch discount for 15%, I was proud of them. And when I saw them post a 40% discount code on Facebook, I was shaking my head. Because this is a lesson that everyone needs to learn.

Your business model has to include how you plan to survive beyond your first year, not just how you'll get your first 100 customers.

Why I'm So Excited for #WCSD

And that is why I'm so excited about WordCamp San Diego. The Sunday business track will be offering practical and useful information for plugin and theme developers, along with freelancers, to help them think practically about issues like recurring revenue.

Oh, and that new company with a new plugin that is pure awesome….guess what? Even though I'm paying almost full price, I'll still tell others about them, because it's remarkable. I've even written a review of their stuff over at

They have a recurring revenue model, so you'll be paying them monthly, which is great because they can then support you beyond the first month. Want to check them out directly? If you're looking for a WordPress Marketing Automation solution: try ORBTR.