Recurring Revenue Definition

Recurring revenue is a way for brands to generate incremental revenue from an existing customer base. Examples include membership or loyalty programmes which charge customers monthly or annual fees, commission based revenue from third-party providers and partners such as travel extras. An example being travel related extras on a travel website such as airport lounges, transfers and parking to travel insurance and hotels on travel websites.

These types of programmes increase revenue potential and drive online business while providing customers with more value and choice.
For your customers are what will make a recurring revenue programme successful. With loyalty programmes there is redemption liability, meaning parties that earn transactional commission are liable to pay tax on points which are not redeemed. Recurring revenue programmes can also reduce redemption liability. Platforms such as loyalty auction programmes and cash back online stores which accept points as currency provide a channel for customers to burn points. Find out more about recurring revenue programmes offered by Collinson Latitude

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