What is the best way to price a membership
If you've created the site for membership or you're considering it because you're excited about the prospects of community-based businesses, that's awesome! Membership sites are amazing and have the awesome capabilities to grow in ways that you won't see anywhere else in the economy of creators.
Imagine the idea. Imagine the possibility of bringing together a group of people around an issue that is important to them and you and guide them through the change they are interested in. That's what you can do with the membership sites.
However, one of the toughest things about getting started is working out how much to actually price the product. How do you know the appropriate price so that you don't end up A. Working for nothing or, B. charging so much that people are ejected.
Good news is that we've got the data. So in this article, we'll explain the lessons we've learned on pricing the membership sites we found in our survey of 12,000 . (Don't think about it, if you would like to create with your very personal Mighty Network, you can try it for free! )
The article
1.1. Paid plans sell
1.2. There aren't any millions of fans
1.3. The growth process is natural
1.4. Paid membership drives engagement
2. Average membership site price for a Mighty Network
3. Questions to consider when determining the cost of a membership website
3.1. Can it scale?
3.2. How does it fit in your model of revenue?
3.3. What is the amount you need to keep going?
4.2. Value-based pricing
4.3. Consider the options of your members
4.4. Prices based on income objectives
4.5. One-time vs recurring fees
4.6. Members churn
What data we have
Paid plans are sold
If you're concerned about implementing the pricing method to your membership website in order to frighten people away then let us put your fears at peace. Our research shows the sites that offer paid plans and plans for paid membership, they can offer paid plans. 77% of that have the option of payment selling. That means your chances that you sell memberships are extremely high! That's a plus!
In the event that you're contemplating a freemium business model that allows users to get a free membership and then pay for upsells then you're in luck too. The Freemium model still has a 70% conversion rate to their products.
It's not necessary to have million of people following you
Many of us members are selling memberships to communities that do not have huge followers. 53% of them are less than 10,000 fans!
The growth process is organic
In the framework of a Mighty Network, the Host is able to allow users to invite friends to join the community. For a community that is paid it is possible to see this growth organically with people inviting their acquaintances is two times as fast that it happens in a free community.
Paid membership drives engagement
A well-worn adage states that people are able to appreciate what they pay for which is the case with memberships as well. The level of engagement with our members who pay. And you don't need to be posting 100 times a week to make it happen. The most popular Hosts just have to publish 2-4 times a week for their communities to stay alive.
Cost of membership for a typical site for a Mighty Network
The average price of a Mighty Network is $39.55/mo. For many of the larger communities, this fee helps the creator on a full-time basis. But even in a smaller community, this fee is a fantastic side hustle AND an even better model for monetizing than almost any other option within the economy of creators. It would take tens of thousands to millions of views in social media to earn this amount.
And with the ability to charge over $1000 You also are able to look into expensive courses and memberships without needing to integrate another website.
Considerations to make when evaluating the cost of membership sites
So if you're trying to figure out exactly what the right price is for your membership website Our data suggests that the average cost is between $15 and $40. This doesn't mean you can't charge more in some cases However, you'll need some planning.
Here are a few questions to get you started on pricing your own website:
Does it scale?
Each membership site isn't made to be the same. Some can scale endlessly, and there are communities that have tens of thousands of people within them. The huge community gives creators a lot of latitude to charge less for membership because they're making a profit based upon the scale.
But if you were running a community that's smaller in scope, such as group coaching or a mastermind community in which you will be limited in members that you are able to serve, there's a good chance you'll have to charge more.
What does it mean within your revenue model?
The cost of a membership website shouldn't be an end-all-beall solution. Consider it a whole part of the model for monetization. If you are offering upsells for example, courses or premium group access, then you'll prefer to keep the price of membership low, recognizing that it's easier to upsell to people already in your community than to try to make your product available to the public.
If you're selling a physical product that the membership site is able to support, you might choose to provide a community for customers on a free basis or at an additional fee that helps customers use the product. Find out how any member income fits into your current or planned income streams.
How much do you need to keep going?
It's easy to become excited about the possibilities with the possibility of monthly recurring income. Since the internet is full of stories of individuals making a lot of money doing small, it's very easy to think your community will make you rich.
and we are hoping it's the case!
If you don't see a lot of users joining within the first month, what are the next steps you have to do?
If you're planning to put work into an ongoing community, what's your baseline of income you'd need for that duration?
As an example, let's say you're confident you could get 15 members (or possibly offer 15 memberships in advance). Even if you only fifteen members the following year, what much would you have to charge them in order to ensure that the group is worth your investment?
Pricing Aspects
You've probably guessed in trying to figure out how to price a membership site, there's no one-size-fits-all approach. It's a matter of weighing a number of factors that are unique to your. Here are some final things to consider:
Members must be invested
Like we mentioned earlier among the many things we see again and again is that people appreciate the value they get for their money. It means that even though it may be counter-intuitive community that have a fee generally have healthier members and higher member engagement.
Price-based on value
One of the most tried and tested methods to approach pricing is to look at the value. Don't think about the hours you put into something to create it, think about the worth it's going to bring to those who sign up. As an example, suppose that an entrepreneur joins a community and gains the experience as well as the guidance, instruction, and motivation to grow their business from 0-$100k/year in revenue, what will that community's membership mean to them?
Consider your members' alternatives
What ELSE do your members need to pay for to get the results they'll get from being in your community. If you're the fitness center to help members achieve their goals for health think about what they'd need to spend to attain those goals otherwise. An individual trainer? A gym membership?
Think about the amount members be required to cover to accomplish their objectives through other methods.
Pricing is based on revenue targets
Other factors which could affect your pricing structure for your membership website is the amount you want to earn. Let's say you wanted to earn $4,000 a month to quit your day job. You could utilize this figure to calculate backward and determine your revenue objectives.
So for example, if you felt confident that you could get 100 people to join your community You could set a price of $40. If you wanted to make an average of $4,000 per month as a group coach, you might decide it's not worth a team with 100 participants. If this is the situation, you'll need to move backwards depending on the capacity you have. If you knew that you could run 6 groups per month, with eight members, then your membership fee becomes an algebraic equation: 4000 6 x (6 8) equals $83.33/mo.
One-time vs recurring fees
Most of what we've shared below is based upon an idea of regular month-long membership fees. But there may be instances where it makes more sense charging a single fee. In the case of example, if you have a high-value program that is able to be completed within two weeks and is included in your membership You might think about the possibility that some of them might decide to take the course but then decide to leave. That could be an instance when a single cost that provides 6 months of free membership is more sensible.
Churning of membership
Websites that are new won't have the number at this point, however, when you've been in operation for a while you can determine what your membership churn is(e.g. e.g. how long your members are on average and how many leave every month. It can determine your pricing strategy in order in order to determine the right price per participant.
Conclusion
As you've seen above There's not a single solution to the question of how much you should charge for your membership website. One of the best options is take these things into account and create the price that is reasonable for you in line with the value your members will get from the site.
And if you're looking for a place to build an amazing member-based group which lets you sell classes, host discussion forums streaming live, or connect with your members via the app, you can try at no cost!