Membership programs and filtering mechanisms

If you’re a consumer facing company, you care a lot about what your consumers think of you. One of the pretty definitive pieces of advice for small companies is Paul Graham’s axiom to do things that don’t scale. Small companies actually have the *luxury* of being able to talk to all of their customers, to understand their wants and desires and see what resonates with them.

On the other end of the spectrum, you have big companies which are probably pretty established in people’s minds, so the brand is less malleable. These companies also have the sort of budgets and marketing teams to conduct research and surveys and focus groups to see what people want, even if they can’t physically talk to every single user. What about companies somewhere in the middle? 

What would the perfect solution look like? Ideally, you want a way to talk to all of your customers, but you probably can’t reach them all. Next best, I would think, is probably talking to your ‘core consumers’ – the ones who really like your brand. As you evolve and develop new products and improve upon things, it’d be useful to somehow talk to these people in particular, to see how they feel about your latest offerings and where you can improve. Maybe you don’t have much of a budget for marketing, but if you can identify these people, it’s probably worth it. 

But what if you could turn this on its head – what if instead of paying to find them, you could get them to pay you? 

One of the brands I really like is Tracksmith – they make really high quality running apparel – and they made me realize recently that there is kind of brilliant way to do that. They have a program called Hare AC where you pay $128 a year and get access to some free stuff and perks like concierge service, a running singlet, and – notably – early access to most of their new clothing launches.1

So say I’m Tracksmith. I want to be able to find my core consumers, and let them serve as my canaries in the coal mine identifying whether new launches will see a lot of demand. It’d be nice to have situations where they can tell us other things they’d like us to do, too. Instead of me doing market testing to try and find these people, I instead launch a service where they *pay me* the privilege of being one of my guinea pigs, helping me improve my forecasts about new brands, and giving me important feedback on the company. 

I don’t mean to suggest they’re the first brand to do this – loyalty programs exist all over the place – but they’re the one that made me realize how smart this is. If you can’t talk to everyone, don’t pay for some research or testing to figure out who your core customers are. Just find some sort of filtering mechanism, like a cashflow positive ‘membership program,’ that does all the work for you. Pretty smart.