If you’ve created a membership site or if you’re mulling it over because you’re excited about the prospects of a community business model, that's awesome! Membership sites are amazing and have the awesome capabilities to scale in ways you won’t see anywhere else in the creator economy.
Just think about it. Imagine being able to gather a group of people around something that matters to you and them, to walk them through a transformation they care about. That’s the power of a membership site.
But one of the hardest things about getting started is figuring out what to actually charge for the thing. How do you know the right price point, so you don’t end up A. Working 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 how to price a membership site from our survey of 12,000 Mighty Networks. (Don’t forget, if you want to start your own Mighty Network, you can try it for free!)
In this article
((toc))
1. What our data shows
Paid plans sell
If you’re worried about adopting a pricing strategy for your membership site and scaring people off, let’s put your mind at ease. Our data shows that, when membership sites offer paid plans, they are able to sell paid plans. 77% of Mighty Networks that have the option for payment are making sales. That means your chances of selling your membership are high! Which is good!
And if you’re thinking of a freemium business model, where people get free membership and then pay for upsells, you’re in luck here too. Freemium Mighty Networks still have a 70% conversion rate to their products.
You don’t need millions of followers
A lot of our Mighty Networks are selling memberships to their communities without enormous followings. 53% of them have fewer than 10,000 followers!
Growth is organic
Within a Mighty Network, the Host can choose to let members invite others into the community. In a paid community, this organic growth with people inviting their friends is twice the rate it is in a free community.
Paid membership drives engagement
The old adage is that people value what they pay for, and this is true of memberships as well. We see a higher level of engagement with our paid membership communities. And you don’t need to post 100x a week to make it happen. The most successful Hosts on Mighty Networks only need to post 2-4 times a week to keep their communities thriving.
2. Average membership site price for a Mighty Network
The average price of a Mighty Network is $39.55/mo. In many larger communities, this membership fee supports the creator full-time. But even in a smaller community, this price means a fantastic side hustle AND a way better monetization model than almost any other option in the creator economy. You would need tens of thousands to millions of views on social media channels to match this income.
And with the ability to charge over $1000, you also have the opportunity to explore high-ticket courses and memberships without having to add another platform.
3. Questions to consider when pricing a membership site
So if you’re trying to figure out exactly what the right price is for your membership site, our data shows an average price of $15-$40. This doesn’t mean you can’t charge more in some cases, but it will take some strategy.
Here are some questions to lay the groundwork for pricing your own site:
Can it scale?
Not every membership site is created equal. Some can scale endlessly, and we have communities with tens of thousands of people in them. These huge communities give creators a lot of latitude to offer membership for less since they’re recouping costs based on scale.
But if you were running a community that’s limited in scale, say a group coaching or mastermind group where you will be limited in members you can serve, you probably need to charge more.
How does it fit within your revenue model?
The pricing of a membership site isn’t taken on its own. You should consider it as a whole part of your monetization model. If you offer upsells, like courses or premium group access, you may want to keep the cost of membership low, recognizing that it’s easier to upsell to people already in your community than to try to sell products outside.
If you sell a physical product that your membership site supports, you might choose to offer a customer community for free or for a small fee to help people use the product. Figure out how any membership revenue fits within your existing and planned revenue streams.
How much do you need to keep going?
It’s so easy to get excited about the possibilities with monthly recurring revenue. Since the internet is full of stories of people earning tons of money while doing very little, it’s easy to think your community will be your road to riches.
And we hope it is!
But, if you don’t get tons of people signing up the first month, what do you need to keep going?
If you’re going to put work into a community every month, what’s your baseline of income you’d need for that time?
As an example, let’s say you’re confident you could get 15 members (or maybe you can even presell 15 memberships). Even if you only had those 15 members for the next year, how much would you have to charge them to make the community worth your while?
4. Pricing Considerations
As you may have gathered, when trying to figure out how to price a membership site, there’s no one-size-fits-all approach. You’ll be considering a lot of factors that are unique to you. Here are some final things to think about:
Members need to be invested
As we said above, one of the things we see again and again is that people value what they pay for. This means that, while it may be counter-intuitive, communities that charge something are often healthier and have higher member engagement.
Value-based pricing
One of the tried and true ways to think about pricing. Don’t think about the hours you put into something to create it, think about the value it will have to the people who join. For example, if an entrepreneur joins a community and gets the knowledge, teaching, and encouragement to grow their business from 0-$100k/year in revenue, what would that membership be worth to them?
Consider your members' alternatives
What ELSE would your members have to pay for to get the results they'll get from being in your community. If you have a fitness community that helps people achieve their health goals, consider what they'd have to pay for to reach those goals otherwise. A personal trainer? A gym membership?
Consider what members would have to pay to achieve their goals by other means.
Pricing based on income targets
One of the other considerations that may impact your pricing model for your membership site is your income target. Let’s say you wanted to make $4,000/mo in order to quit your day job, you could use this number to work backward and set revenue goals.
So for example, if you were pretty confident you could find 100 people to join your community, you could charge $40. If you wanted to make $4,000/mo as a group coach, you might decide you don't want a community of 100 people. In this case, you could work backward based on your capacity. If you knew that you could run 6 groups a month with 8 people in each, your membership fee becomes a mathematical equation: 4,000 ÷ (6 x 8) = $83.33/mo.
One-time vs recurring fees
Most of what we’ve shared above is based on a model of recurring monthly membership fees. But there may be instances where it makes more sense to charge a one-time fee. For example, if you have a high-value course that people can do in two weeks that comes with your membership, you might consider that some people may choose to take the course and then leave. This could be a case where something like a one-time fee that includes 6 months of free membership makes more sense.
Membership churn
New sites won’t know this number yet, but once you’ve been up for a while you can get a sense of what your membership churn is– e.g. how long members stay on average and how many leave every month. You can use this to inform your pricing strategy to achieve a targeted value per member.
((1))
Conclusion
As you’ve seen above, there’s no one answer for how to price your membership site. The best you can do is take these things into account and create a price that makes sense for you in line with the value your members will get from it.
And if you’re looking for a place to build an amazing membership community, that lets you sell courses, host discussions, live stream, and reach your members through an app, come try Mighty for free! Our awesome cultural software lets you bring together courses, community, content, and commerce in one place!
