Starting a membership community comes with expenses. You are going to need to purchase new technology and payout when planning events. Not to mention will be sharing your expertise - so it’s important to understand the cost of your time.
So what will you need to take into account?
1) The Prices of Similar Services
Check with your main competitors, what are they charging? If you are able to, charge a similar price.
Charging a significantly higher fee for the same service increases the likelihood of prospective members choosing someone else’s community over yours.
Thus if your price is higher, you must ask yourself, are you offering additional services that others are not?
2) The Demographic Of Your Members
I’m sure by now you have figured out who your ideal client is and if you haven’t done that, then check out this resource and come back here once you’ve acquainted yourself.
Taking into account who you are selling your membership community to, figure out what fee they can afford, basing this on their predicted income and expenses.
It may be beneficial for you to check out where your ideal client hangs out. For example, if you’re selling to a Mum in business, check out a Mum group on Facebook, or head over to Mumsnet to browse the different forums and gauge their ideal price point for the community they need.
3) The Opinion Of Your Prospective Members
Assuming you already have a following on a social media platform, use it as your greatest tool when planning for your membership community.
Take to your platforms to discuss the idea of pricing with your prospective members. You could include polls on your Instagram stories, an open discussion on your Facebook page or send out an email with a questionnaire and use all of this data to average a price point that’s comfortable for the majority of your members.
💡 Top Tip: You could have a founding member price that is lower than you would charge in the longer term, but enables you to grow your community at a steady rate for a fair price when first starting out.
4) Consider Different Payment Models
The price you decide on could be dependent on when and what your members pay for. You may decide to have different packages with different fees to accommodate more of your community.
Subscription Payment Model
A subscription-based pricing model will allow your community members to pay a fee on a regular basis to access your community.
The fee can be determined by the duration of the subscription, for example, you may have the option for your members to subscribe monthly at a price of £20 per month, alongside the option to subscribe annually for £200, thus saving them money long-term.
The option for a monthly subscription will provide your members with flexibility, permitting new members to join your community at a reasonable price before deciding whether it’s the right fit for them.
However, this model could make member loss common as they can easily leave your community once the month is over. The reasoning behind their leaving could be due to a difficult renewal process, an unreliable posting schedule or a lack of engagement within the community.
Ensuring your membership has an easy renewal process could be one way to minimise member loss.
As well as working on ways to keep your members engaged, and making sure you have the right tech and tools to stay up to date with your community and posting schedule
But if members still decide to leave your community, ask them to fill out an exit survey so you can avoid making the same mistakes next time.
An annual subscription is perfect for your loyal and already established members, offering them a discount for their commitment to the community.
You may be asking yourself whether this is a good financial move as ultimately, it’s resulting in a loss. However, the value these members hold make up for it. These are the members that will refer others to your community and help out should you need to consider delegating tasks to active members.
💡 Top Tip: Ask members to use a community member referral form when referring members to your community.
A lifetime subscription permits a single payment for unlimited access to your membership community.
One payment for an endless membership is easier to track over recurring payments but offers a limited revenue stream. As members will already feel like they have everything they need with you, they’ll be reluctant to buy into any upselling opportunities.
Furthermore, when setting this price, you may be at the early stages of your community, thus not knowing the long-term cost for your services. Should your requirements change over time, your lack of cash flow from lifetime subscribers could pose a problem for keeping servers and your business running.
Of course, a lifetime subscription doesn’t have to mean until you’re 90 and retired somewhere on a beach. You can set a time limit on what “lifetime” means to you and your members, perhaps it’s a 5-year subscription. But the same cons still apply. It’s what you decide to do with the upfront cash from the subscription that counts to being successful with this membership model. For example, spending it on an all-inclusive holiday may not be the best bet to running a successful long-term lifetime membership payment model.
The Membership Guys discuss one-off versus recurring payment models, which you can check out if you’re still unsure.
Or you can book a time slot to speak to one of us at Ugenie and we would be happy to help!