In this episode, Erik shares which is much better when purchasing a recurring service or product to get a monthly subscription or an annual subscription.
Erik J. Olson (00:00):
When it comes to buying stuff, should you pay yearly or monthly? What is happening? This is Erik J. Olson. I like this question. This is from Matt Kratos over at our sister agency Rival Digital. If you’re an HVAC contractor, go check them out at rivaldigital.com. Matt Kratos is always feeding me things to talk about on this podcast. And I appreciate it, Matt. Thank you, bud. So when it comes to buying services, that’s what we’re talking about. Like recurring services, right? I mean, I guess it could be a product too, but anything where you have to pay for it on a recurring basis, is it better to get a monthly subscription or an annual subscription? So my answer is yes. Here’s what I mean by that. When you first start out with the service, you’re very excited about it, right? There’s a lot of novelty. You’re like, oh, this is gonna be awesome.
Erik J. Olson (00:53):
And you’re like, I’m gonna use the crap out of this, but you know what the reality is that the novelty wears off. You have other problems you gotta deal with. And there’s also like usually work that’s required of getting any kind of service or offering, right. Any kind of product. Like usually it is not just like, it doesn’t really just make your life super easy. Like it helps, but it requires you to do something. So my concern, whenever we get a service here at Array Digital or at Rival Digital or personally for myself or for any of my real estate, right. My concern is always that I’m going to like sign up for something and, and then I I’ll just stop using it. Right. That happens a decent amount here at Array Digital. So by the way, I’m saying Array Digital, I’m saying Rival Digital.
Erik J. Olson (01:43):
I run Array Digital. I own Rival, but I don’t run it. So that, just to clarify why I’m throwing out two names there. So with Array Digital in particular, like we will sign up for some services and then as months go by, I’ll look at the American express statement and I’ll notice the service up there. I’m like, oh, I wonder if anyone’s actually using this still. And so I’ll ask the team, Hey, is anybody using this? And if I don’t get back resounding, yes, I’ll cancel it right. If someone’s like, well, you know, I was kind of hoping to use it, but they haven’t used it yet. It’s been three or four months. I’ll cancel it. So I want to cancel these things because it becomes almost at some point too, more work than it is necessary to cancel these subscriptions. And then before, you know, you’ve got 10 or 20 subscriptions at each cost, you 50 bucks a month and you’re, you’re in for a thousand dollars and you don’t even know what the hell you bought and you don’t even use it. Right? Cause you just keep piling on more and more and more stuff that you have good intentions of doing or using. And then you just don’t. So my take on this question that Matt pose yearly annually is first and foremost, when you sign up, something always start monthly. Yes, you will pay a little bit more per month, but you have the opportunity to very quickly cancel.
Erik J. Olson (02:59):
Now, after you’ve found out that you are going to use it after you’ve worked it into your daily routines or weekly routines or whatever routine you have when it comes to using the service, once it’s caught on, and that could take four or five, six months at that point, I recommend switching to annual. Now, usually with these kinds of subscriptions, you will save 20% if you buy the annual subscription. So over the course of a year, that could be substantial. So if you have a $500 a year service, and I have a couple of those, then over the course of a year, that’s $6,000 a year. But over the course of the year, I’ll save 1200 bucks or 20% it’s worth it. Right. So I definitely recommend that you consider switching to yearly once it’s ingrained in your workflow. And I’ve read about this in other books.
Erik J. Olson (03:51):
I think one of the books up there is Profit First by Mike Michalowicz. Mike Michalowicz and I I’m pretty sure in that book, he talks about that. Definitely go for the, the annual, because you will save money in the long term and it’s worth it. You’re gonna use it anyways. You might as well save, but until you are sure that you’re gonna use it, don’t go annual go monthly. All right. I hope that was helpful, Matt. Hey everybody, if you have a question for me, DM me on Instagram, you can find me there @erik.j.olson. That’s E R I K J O L S O N. Ask me anything you want about digital marketing. Ask me anything you want about law firm, digital marketing. Ask me anything you want about starting a business. Ask me anything about leadership in a business, or ask me anything about entrepreneurship.
Erik J. Olson (04:40):
I don’t know how many things I just rattled off there. Four or five, but that’s my focus area. Those are the things that I talk about. Those are the things that I’m somewhat familiar with. I would say more familiar with those things than most people. That is my passion area. And that is what this podcast is all about. So if you have a question about any of those things, if you’re starting a business, running a business, if you’re not sure what to do with digital marketing, reach out to me on Instagram @erik.j.olson. Ask me your question and I’ll answer it here and on Instagram.