What is the best way to price a membership
If you've created a membership site or if you're considering it because you're excited by the possibilities of a model for community-based business It's great! Membership sites are amazing with the ability to scale in ways you won't see anywhere else in the economy of creators.
Think about it. Imagine the possibility of bringing together an entire group of people in something that matters to them and you, to walk them through a transformation they're interested in. This is the strength of a membership site.
One of the most difficult aspects of starting out is working out how much you should actually price the product. What is the appropriate price to ensure that you do not get to the point of in the position of A. doing nothing for nothing, or B. Inflating your prices so that your audience runs away.
Good news is that we've got the data. In this post, we'll go over our experiences on the best way to charge the membership sites we found in our study of 12,000 . (Don't overlook, if would like to create your own Mighty Network, you can take a trial for no cost! )
In this article
1.1. Paid plans are sold
1.2. There aren't any millions of followers
1.3. Growth is organic
1.4. Paid membership drives engagement
2. Average membership site price for a Mighty Network
3. Questions to consider when pricing a membership site
3.1. Will it be scalable?
3.2. How does it fit within your revenue model?
3.3. How much do you have to spend to stay on the right track?
4.1. Members need to be invested
4.2. Value-based pricing
4.3. Take into consideration your member's options
4.4. Pricing is based on the income goals
4.5. One-time vs recurring fees
4.6. Membership Churn
What our data shows
Paid plans are sold
If you're nervous about choosing an pricing plan for your membership site and scaring people off then let us put your fears at peace. The data we have gathered shows that in the event that membership websites offer paid plans and plans for paid membership, they can offer paid plans. 77% of that have the option of paying selling. This means that your odds that you sell memberships very high! That's a plus!
In the event that you're contemplating the freemium model of business, where people get the free service and later make upsells on their behalf You're in luck as well. Freemium still have an average conversion rate of 70% of their product.
It's not necessary to have thousands of fans
A lot of our members are selling memberships to communities without enormous followings. 53% of them are less than 10,000 followers!
The growth process is organic
In a Mighty Network, the Host may allow members to invite others into the community. If a community is paid for, this organic growth with members inviting friends to join is double the amount it is in a free community.
Paid membership drives engagement
A well-worn adage states that people value what they pay for, which is the case with memberships too. The amount of interaction with our members who pay. It's not necessary to post 100x a week to see it happen. The most successful Hosts on only need to post 2-4 times a week to keep their communities thriving.
Average membership site price for the Mighty Network
The median cost for membership on Mighty Network is $39.55/mo. Many larger communities have this fee helps the creator on a full-time basis. However, even for a smaller community, this price means an excellent side business and a way better monetization model that almost every other alternative in the creator economy. You would need tens of thousands to billions of views on the social media platforms in order to generate this kind of income.
With the capability to take orders over $1000 You also have the opportunity to explore high-ticket programs and memberships without needing to integrate another system.
Questions to consider in determining the price of a membership site
If you're trying to determine what is the ideal price for your site's membership Our data suggests an average price of $15-$40. However, this doesn't mean that you cannot charge more in some cases However, you'll need an approach.
Here are some questions to get you started on pricing your own website:
Will it be scalable?
Not every membership site is created equal. There are some that can be scaled infinitely as well as have communities of many thousands of people within them. These huge communities give creators a lot of latitude to provide membership at a lower cost as they're earning a return on the size.
However, if you're running a community that's small in size, for example a group coaching or mastermind community in which you will be limited in members that you are able to serve, you probably need to raise the price.
How does it fit in your model of revenue?
The pricing of a membership website shouldn't be taken on its own. It should be considered as a whole part of your monetization model. If you offer upsells, such as courses or group access, you may wish to keep the cost of membership low, recognizing that it's easier to upsell to existing members of your community than to try to make your product available to the public.
If you are selling a physical product that the membership site is able to support it is possible to provide a community for customers for free or for an additional fee that helps users use your product. Determine how your membership revenue fits within your existing or planned income streams.
What is the amount you have to spend in order to continue?
It's simple to get excited about the possibilities with the possibility of monthly recurring income. Since the internet is filled with tales of people earning tons of money while doing very small, it's very easy to imagine that your local community could become your path to wealth.
And we hope it's true!
But, if you don't see a lot of users joining for the initial month, what do you have to do?
If you're looking be putting your energy into an ongoing community, what's your baseline of income you'd need for that time?
Let's imagine you're sure you'll have 15 members (or maybe you can even offer 15 memberships in advance). Even if you only fifteen members the following year, what many would you be able to charge them in order to give the community a worth time?
Pricing Factors
As you may have gathered that when you're trying to determine the best way to charge a membership site, there's no one-size-fits-all approach. There are a variety of different factors unique to you. These are a few final considerations to think about:
Members must be actively involved
We have already mentioned among the many things that we observe repeatedly is that people appreciate what they pay for. It means that even though this may seem counterintuitive the communities that are charged tend to be healthier and enjoy more engaged members.
Price-based on value
One of the tried and true ways to approach pricing is to look at the value. Do not think about how many hours you put into something in order to make it. Think about the worth it's going to provide to the members who sign up. As an example, suppose that entrepreneurs join a group and gets the knowledge as well as the guidance, instruction, and motivation to increase their company's revenue from 0-$100k/year in revenue, what will that community's membership mean to the person joining?
Consider your members' alternatives
What ELSE would your members have to pay for to get the results they'll get through your organization. If you have a fitness community that helps members achieve their goals for health take a look at what your members would have to shell out to achieve the goals they've set for themselves. An individual trainer? A gym membership?
Take a look at the costs that members have to pay to achieve their objectives through other methods.
Pricing based upon revenue targets
Other factors that may impact your pricing strategy for your membership site is your income target. If you were hoping to make $4,000/mo in order to be able to quit your current job. You can use this figure to calculate backward and set revenue goals.
If, for instance, you were pretty confident there would be 100 members 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 you don't want a community of 100 people. If this is the situation, you'll need to reverse your work according to your capabilities. If you knew that you could manage 6 groups per month that have 8 people in each, your fee for membership is an equation of math: 4,000 6 x (6 x 8) equals $83.33/mo.
One-time vs recurring fees
The majority of the information we've provided above is based on the concept of monthly membership fees. There are occasions where it makes more sense charging a single fee. In the case of example, if there is a valuable course that people can do within two weeks and includes a membership fee You might think about the possibility the possibility that some individuals might choose to enroll in the course, but then decide to leave. That could be an instance where something like a one-time cost that provides six months of membership for free would be more appropriate.
Member churn
New sites won't know the exact number, however once you've been up for some time, you'll be able to know the percentage of your members who leave(e.g. e.g. how long members stay in the average, and how many members leave each month. You can use this to determine your pricing strategy in order in order to determine the right price per participant.
Conclusion
Like you've read above, there's no one answer for how to price your membership site. One of the best options is to take all of these factors into consideration and come up with the price that is reasonable for you in line with the benefits your customers will get from the site.
If you're searching to establish an amazing member-based group with a platform that lets you sell lessons, hold discussions streaming live, or reach your members through an app, come try for free!