How do you price a Membership Site in 2022
If you've made a decision to create the site for membership or you're considering it because you're excited about the prospects of a community business model, that's awesome! These sites are fantastic with the ability to scale in ways you won't see anywhere else within the creation economy.
Just think about the idea. Imagine being able to gather an entire group of people in something important to them and you as they guide them through a transformation they're interested in. That's what you can do with the membership sites.
One of the most difficult tasks to begin with is working out how much to actually price the product. How do you know what is the best price, to ensure that you do not end up A. doing nothing for nothing, or B. charging so much that your audience runs away.
The good news is, we've got the data. So in this article, we'll walk you through what we've learned about the best way to charge an online membership website from our survey of 12,000 . (Don't overlook, if would like to create the creation of your own Mighty Network, you can test it out for free! )
This article
1.1. Paid plans are sold
1.2. You don't need 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 pricing a membership site
3.1. Can it scale?
3.2. How does it work in your model of revenue?
3.3. What is the amount you have to spend to stay on the right track?
4.2. Price-based value
4.3. Take into consideration your member's options
4.4. Pricing based on income targets
4.5. One-time vs recurring fees
4.6. Member Churn
What our data shows
Paid plans are sold
If you're nervous about choosing a pricing strategy to your membership website and scaring people off, let's put your mind at peace. Our data shows that, the sites that provide paid-for plans, they are able to offer paid plans. 77% of those that offer the option for payment are creating sales. That means your chances that you sell memberships very high! This is a good thing!
And if you're thinking of a freemium business model, where people get the free service and later purchase upsells for a fee, you're in luck here as well. They still boast a 70% conversion rate to their products.
You don't need thousands of fans
Many of us are selling memberships to their communities that do not have huge followers. 53% of them are less then 10,000!
Organic growth is natural
In a Mighty Network, the Host can choose to let members invite others into the community. If a community is paid for, this organic growth with people inviting their friends is twice the rate of a non-paid community.
Paid membership drives engagement
The old adage is that people are able to appreciate what they pay for and this is true of memberships too. We see a higher degree of participation in our paid membership communities. It's not necessary to post 100x a week to make it happen. The most successful Hosts on 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 median cost for membership on Mighty Network is $39.55/mo. Many larger communities have this membership fee supports the creator full-time. Even in a small community, this fee is an amazing side hustle and an even better model for monetizing than almost any other option in the creator economy. You would need tens of thousands to millions of views in social media in order to generate this kind of income.
and with the capacity to take orders over $1000 You also can explore high-ticket classes as well as memberships, without the need to integrate another system.
Questions to consider when pricing a membership site
If you're trying to determine what is the ideal price for your membership site Our data suggests an average of between $15-$40. This doesn't mean you can't charge more in some cases However, you'll need some planning.
Here are some questions to lay the groundwork for pricing your site's own price:
Can it scale?
Each membership site isn't made in the same way. Some can scale endlessly, as well as have communities of tens of thousands of people who are members. These massive communities allow creators a lot of latitude to provide membership at a lower cost as they're earning a return on scale.
If you're running a community that's limited in scale, say group coaching or a mastermind group that have a limited number of people who you could serve, then you probably need to raise the price.
How does it fit into your business model for revenue?
The price of a site that is a member's club cannot be considered a standalone thing. Consider it a whole part of the monetization strategy. If you're offering upsells for example, courses or premium group access, then you'll prefer to keep the price of membership low, recognizing that it's much easier to offer upsells to members of your community than to try to market your products elsewhere.
If you're selling the physical item your membership site supports You could decide to provide a community for customers on a free basis or at a small fee to help customers use the product. Find out how any member revenues will fit into your current and future revenue sources.
How much do you have to spend in order to continue?
It's easy to become enthusiastic about the potential of the possibility of monthly recurring income. The internet is full of stories of people earning tons of money while doing very little, it's easy to believe that your neighborhood will make you rich.
And we hope it's the case!
If you don't get tons of people signing up for the initial month, what do you do to continue?
If you're planning to work in the community each month, what's your baseline of earnings you'll require for this period?
As an example, let's imagine you're sure you'll get 15 members (or maybe you can even pre-sell 15 memberships). Even if you only had those 15 members for next year, how many would you be able to charge them to make the community worth your while?
Pricing Aspects
You've probably guessed in trying to figure out how to price for a membership website it's impossible to find a standard approach that will work for everyone. There are a variety of different factors unique to your. Here are some final things to think about:
Members have to be invested
Like we mentioned earlier, one of the things that we observe repeatedly is that people appreciate what they pay for. This means that, while it might seem odd the communities that are charged tend to be healthier and enjoy greater engagement among members.
Value-based pricing
One of the most tried and tested methods to think about pricing. Do not think about how many hours you put into something creating it, but think about the value it will provide to the members who join. For example, if an entrepreneur is a part of a community and gets the knowledge of teaching and support to increase their company's revenue from 100-$100k in annual revenue, how will that community's membership mean to the person joining?
Consider your members' choices
What ELSE do your members need to spend money on to receive the benefits they'll gain from being in your community. If you have an exercise center that aids members achieve their goals for health think about what they'd need to pay for to reach those goals otherwise. An individual trainer? A gym membership?
Consider what members would be required to cover to accomplish their goals by other means.
Pricing is based on revenue targets
Other factors which could affect your pricing model on your membership website could be your income target. Let's say you wanted to earn $4,000/month in order to quit your day job. You could utilize this number to work backward and set revenue goals.
So for example, if you were pretty confident there would be 100 members willing to be part of your group You could set a price of $40. If you want to earn an average of $4,000 per month as a group coach You might be able to decide that you do not want to create a group that is 100 members. If this is the scenario, you can work backward based on your capacity. If you knew that you can run six groups a month with 8 members, then your fee for membership is a mathematical equation which is: 4,400 / (6 8) = $83.33/mo.
One-time vs recurring fees
The majority of the information we've provided below is based upon a model of recurring month-long membership fees. There are occasions where it makes more sense charging a single fee. In the case of example, if you have a high-value course that people can do within two weeks and comes with your membership, you might consider the possibility that some individuals might choose to attend the class and then leave. That could be an instance when a single fee that includes the benefit of 6 months of complimentary membership would be more appropriate.
Member churn
Websites that are new won't have the number at this point, however, after you've been online for a few months, you'll get a sense of the percentage of your members who leavefor e.g. how long members stay on average and how many members leave each month. It can guide your pricing strategies for achieving a specific amount per person.
Conclusion
As you've seen above, there's no one solution to the question of how much you should charge for your membership site. The best you can do is to take these elements into consideration, and then create the price that is reasonable to you, based on the benefits your customers can expect from the site.
If you're searching to establish an incredible membership group , that permits you to offer lessons, hold discussions streaming live, or engage your members with apps, try it for free!