Important: Want the top tips on getting your online business off the ground? Then 'like' our Facebook page (link opens in new window) for all the latest tips and advice. Come and say hi. 🙂
This lesson is continued from Lesson 2 Part 1: How To Create A Membership Website With WordPress.
How Often Should You Charge Members?
Next up, is the question of how often you should charge your members. Should it be a one off payment, or should you charge them a recurring fee?
The software we’ll be using to deliver our membership site (Which we’ll be looking at more next lesson) allows you to charge users as often as you like. So for example you can charge members on a monthly basis, on a weekly basis, or even every 19 days. It’s really up to you and your needs.
(P.S. If you use this software alongside a payment processor such as Clickbank however, you need to remember that Clickbank aren’t as flexible with recurring options. Because of this, with Clickbank and some other processors, you’re limited to choosing weekly, bi-weekly, or monthly etc payments).
Despite having the option to charge people every 19 or 20 days, it’s always best to charge people on a more socially acceptable basis, such as once a month or once a week. This is because people will be able to keep track of it better in their calenders, and they’ll in turn have one less mental barrier to buying your course.
You can of course also only charge people a one off membership fee, but unless there is a real reason to do this within your niche, I don’t recommend it. One of the main reasons behind creating a membership site is so we can stabilize our income. If people only pay us a one off amount and that’s it, we still have to keep selling in order to keep our income coming in. If however we sell a course that gets money from customers on a monthly basis, we know there’s a good chance that customer will carry on making us money for some time to come (Providing the course is good quality and affordable in your market). I’m not saying that you can’t make more money in the short term by charging a higher one off membership fee, but if you want to stabilize your income like we’re aiming to do in DRC Traffic Pro, then a recurring billing option is best.
So that leaves the daily, weekly, monthly, quarterly, or yearly recurring options.
I’d personally recommend you go for the monthly charging strategy. Here is the reasoning behind that.
Charging people weekly can be seen as too much. If your members see money coming out of their account every week, they’re more likely to see that charge as something that’s a drain on their income. It’s just always there. So they’re more likely to cancel. This is the same reason I don’t recommend doing daily charges, as this is the same but even more extreme.
Another reason weekly charges aren’t ideal, is because the money you can lose out on. When you charge a monthly membership fee, you are charging people for a month in advance, and gaining a lump sum for the next four or so week. If they cancel their membership mid-month, you’ll still have received the payment for the whole month. If you’re charging weekly however and they cancel mid month, you’ve lost out on two weeks worth of payments. Now say 100 members do this over the year. That’s 200 weeks (Almost 4 years) worth of payments you’ve missed out on. Not cool at all…
While you could argue that weekly payments offer a lower perceived cost so more people are likely to take you up on the offer, this isn’t something I’ve seen. As long as you provide a trial in your course and make it reasonably affordable, there shouldn’t be too much of a barrier to entry for most.
I don’t recommend yearly memberships either. The thing is, waiting a year for a payment is WAY too long. And what happens if your member cancels 10 months in? That would be a super frustrating feeling. It doesn’t do much to stabilize income, and it takes too long to see results for your efforts.
On top of that, you’ll get a lot of people charging back your payments. What happens is a lot of people will forget they’re signed up to what it is you offer, and when a payment they don’t recognize (Because it’s been so long) comes out of their account, they’ll go to their bank and tell them to cancel the payment. This will reflect negatively on your income, as you actually lose money for charge backs (Bank processing fees get charged to you when the payment is taken, AND when the payment is charged back). Go for it if you think it’ll suit your business for whatever reason, but a yearly recurring site is not a method I’d recommend to most.
So that leaves a monthly recurring site. This is ideal, as it doesn’t charge people so often they feel like money’s always coming out of their account, but it’s often enough for you to keep seeing money come in.
What’s more, people are used to paying a monthly fee. They pay their rent monthly, their bills, their gym membership, other online courses… People have been trained to be comfortable with monthly charges. So give them what they expect.
Monthly can either be classed as 28 days, 30 days or 31 days. If you have a course which gives out new content on the same day every week, 28 days as a month is ideal. This is because they’ll get exactly 4 lessons before they’re charged again.
Please bare in mind that the billing frequency I’ve suggested isn’t set in stone. There may be another billing option that may be more suitable in your niche, it’s impossible for me to say considering I don’t know what niche you’re in. 🙂
Having said that, this will be the best option for most people.
Should You Provide A Fixed Length Membership Or An Ongoing One?
The next thing you need to think about is whether you should provide a fixed length membership to your visitors, or if your membership should be ongoing until your members cancel.
Both of these options have their pros and cons, which we’ll look at now.
Main Pros Of A Fixed Length Membership
- One Time Product Creation.
Unless you offer a service which is fixed length, with a fixed length membership site, you will only have to create your information product once. This could be text lessons, video lessons, or audio lessons; it doesn’t matter. After your product is created however, that’s it; you don’t have to worry about content creation anymore. You can keep delivering the lessons you’ve made over and over again to your customers, and do it on autopilot using membership site software.
From here you can focus all your efforts on promoting your course and customer support.
Main Cons Of A Fixed Length Membership
- You Limit Your Income.
While it’s great that you don’t have to create a product anymore and your time can be put to other things, having a fixed term membership means you can only earn so much money form each customer. If you course is six months long for example, you know you’re only going to earn a maximum of six months wages from this person on this particular course. Alternatively:
Main Pros Of A Ongoing Membership
- No Income Limit Per Customer.
If you have an ongoing membership site, you can carry on charging your members until the day they cancel. While this could be after a month or so, you could also potentially retain your members for years and as long as you offer your service. This means the average value per customer will go up a lot, especially if you produce good content for them regularly, or have a quality service you allow them to use.
Main Cons Of A Ongoing Membership
- On Going Content Creation.
A potential downside of a ongoing membership site is you will have to continue to provide new information, services or products to your customers. If you have memberships that last for years, you will constantly have to do new things to keep your members interested. You will also have to balance this with keeping your new members happy by giving them basic beginner lessons as well. This can be time consuming, although the workload can be eased by outsourcing content creation.
- Software Running Costs.
If software is at the core of your membership, issues such as upgrading software with new features, fixing bugs and the like will arise. This can be costly to fix, and can also be costly if your members decide to drop out and go to a competitor while your software is down.
Which method you decide to go with is largely up to you. Are you ok with constantly providing new content for members? Or would you prefer a ‘one time set up and hands off from there’ approach?
Bare in mind though, that the option you go with isn’t always fully down to you. The decision can be niche dependent, and also customer dependent.
Let’s say for example you have a membership which gives people tips on the stock market. This isn’t they type of thing you could write up in advance and never have to work on again, this information is time sensitive, and your customers will expect new tips every week (Or more likely every day).
The alternative if you wanted to do a fixed membership in that niche, is offering a course on learning how to trade. So you’re not dealing as much with time sensitive information, and instead teaching them the theory behind this skill. You can create this course in a one off work load, then keep delivering it to new members on autopilot and it will still be relevant.
How Often Should You Update Members With New Content?
So, how often should you update your members with new content? Well, this will depend entirely on your niche, how much you have to say, and how you’re creating your course.
If you’ll be creating your course using the tactic I’ve mentioned in the above ‘The Most Important Trick When Creating A Membership Site’ section, you will need to take into consideration how long it takes you to create each new lesson. If it takes you a week to comfortably create a new lesson, then deliver it weekly to begin with. Then when the course is finished and you have all of the material, you can offer it both as a weekly course, and sell it as a one off membership access for a higher price (If you so choose, and don’t want to use memberships to stabilize your income with recurring payments).
If it takes two weeks to create each lesson however, you have two options:
- You could either put new content out every two weeks, or
- You could finish half of the course content before you launch your membership site, and then release each lesson weekly while finishing off the rest of the course.
If the time content creation takes isn’t an issue, you have a few options. You can deliver content daily, weekly, bi-weekly, or monthly.
If you’re in a fast moving industry such as stock tips or betting tips, you may want to deliver fresh content daily, or a few days a week. This is what your audience will expect, and give them the advantage they need to make a success of their efforts.
If you’re not in as much of a fast moving industry however and you’re delivering digital information or products, a good idea is to go with fresh content on a weekly basis. This is often enough to keep people looking forward to your new content, but not so long that people get frustrated and unsubscribe.
People have been trained into waiting a week for things. Most TV programs come on once a week, as do a lot of gym classes. This is what people are used to, so give them something that they will naturally be comfortable with.
Giving them a week in-between each lesson will also mean you can keep them as one of your members for longer, and have a better chance to build up a lasting relationship with them. So weekly lessons is often the way to go.
Membership sites are one of the best ways to retain and stabilize your income. With one off product sales, if your traffic stops, so does your income from those products. If your traffic stops when you’ve got members paying monthly fees to you however, your income will continue while you work on getting your traffic back.
There are a lot of different options for the type of membership you offer, and some will work better for your niche then others. Offering a both a free and paid membership however is always a good idea, and can help increase your conversions as well as mailing list subscribers.
What To Do Now
Here is what you should do between now and next lesson. If you don’t have the time, that’s fine. Do as much as you can, and do the rest when the time is there:
- Think About What Type Of Content You Could Provide To Members.
First, you need to decide what you’re going to offer to members. It needs to be something of value, and something your regular website visitors will appreciate. It has to solve a need, whether that’s how to do something, helping them to keep fit, or keeping them entertained.
So have a think, do some research on your better ideas, and decide on a membership you can offer.
- Decide Other Important Questions About Your Membership Site.
How often will you deliver your content?
What format will you deliver your membership goodies in?
How often will you charge members?
Will it be a free membership, a paid one, or a mix of both?
Will it be an ongoing or fixed length course?
- Start Mapping Out Your Course.
The best way to go about starting a membership site, is to map out exactly what you’re going to include in it. If you’re doing weekly lessons for a fixed period of time, map out exactly what’s going to happen in each of those lessons. You can do this in terms of a paragraph or two outlining the content, or by doing the relevant headings so you know what to cover when you come to creating it.
- Start Creating The Content.
If you have decided you’re going to do a membership site and you want to start on it right away, that’s what you need to do. Start creating the first few lessons so you’re in the position to launch even before all of the content is fully complete. Because of this, it’s important you get the first few lessons complete in the order you’ll be delivering it.
What’s Happening In The Next Lesson
Next lesson, we’ll be looking at exactly how to set up your membership site! We’ll be looking at the software to use (The same software I’ve used to deliver DRC Traffic Pro), some strategies to launching your membership site, dealing with member losses, and much more. I’ll see you then.