Many service and information providers believe they can make more money – and more consistently – by having a membership. And if they do it properly and have the right personality to keep up with it, they’re right.
What makes a membership so great?
- It provides a recurring income stream. That is, you make a sale one time to a customer and they continue to pay you. Recurring income is every business owner’s dream! It’s the biggest benefit of offering a membership.
- You can leverage your time. This is particularly true if you’re a service provider. Regardless of what components you include in your membership, you’ll be producing them once for all your members. So even if it takes you 10 hours to create a month’s membership content, if you have 100 members paying $30 per month, you’ve made $300/hour, which is pretty good. And if you have 500 members, hooray for you! You’re earning $1,500/hour!
- Members may buy more from you. We all know that having a list is valuable so you can market to your subscribers. Having a membership can be even more valuable since these people aren’t only subscribers, they’re already customers who value what you offer enough to keep paying for it. Of course, you don’t want to market to them so much that you shoot yourself in the foot by losing members.
- You can get referrals from members. If you do a terrific job with your membership, you create raving fans who attract people they know to become members and/or buy your other products or services. In other words, if you really impress your members, they will often help market you to their circles of influence.
- Creating a successful membership can position you as an expert in your field. As your membership grows and becomes more known, you will be seen as an important player in your area of expertise since you must have good content to attract a large group of people willing to pay for it consistently.
- A membership “forces” you to create content. Sometimes we find it difficult to carve out the time to create new content. Other times, we just can’t quite get it completed. When you must produce new content regularly for your membership, you’ll quickly learn to be more consistent and disciplined about it or you’ll find your members disappearing! As long as the constant need to deliver new content doesn’t make you totally crazy, this deadline pressure might be a good thing for your business.
- A membership can become a community of people who support each other – and you. If you want to create a true community with your members, provide a safe and convenient environment, both physical (in person and/or online) and emotional, and encourage members to share and help each other. If you succeed, you will find yourself with a community that your members may find as valuable as the content you provide. In fact, you’re likely to find this community’s support valuable as well.
There are also a few downsides to creating membership. One that has popped up in listing the benefits of a membership, is that you usually need to be creating something new every month. That can be stressful and even too much for some people to manage.
An often hidden issue is attrition. Just because you have 100 members this month doesn’t mean you’ll have those same 100 members next month. You’ll likely see some number of people cancel their membership every month, so to have consistent income, you need to be continuously attracting new members. Of course, the more valuable your membership components are and the closer you get to having your ideal audience signing up to your membership, the longer they’ll stay members and long-time members is definitely what you’re shooting for.
If you don’t already have a membership in your portfolio of products, perhaps you should consider offering one. While offering a membership does involve effort and discipline, the benefits are significant.