3 Secrets of Profitable Membership Sites

A Quick Story…

One day, a man goes to a car dealership and tells the salesman that he wants to buy a car. The salesman asks, “What are you looking for?” and the man says, “I need something that turns on, goes forward and runs on gas.” The salesman looks at the man puzzled and being careful not to insult him responds, “We have a lot of cars that do that. Is there anything else?” The man replies, “Yes, I only have $800 to spend.” Now knowing that there’s only one car that fits this description, the salesman smiles and says, “Here’s what you’re looking for. This is a classic VW Beetle. It turns on, goes forward, runs on gas and it’s only $750.” The man says, “Perfect! I’ll take it.”

Later that day the man arrives home, runs into the house and very excitedly asks his wife to come outside to see their new car. Upon seeing the Beetle, a confused look comes over his wife’s face and she asks, “where are we going to put our 3 children?” The man furrows his brow, scratches his head and says, “Hmm… I didn’t think about that.”
start a successful membership site

Secret 1: Plan for Success

It seems obvious, but I can’t overemphasize the importance of this point. One of the biggest mistakes I see people make when they are starting out is to not actually plan for success. When selecting a membership solution, too much attention is placed on the price and not enough on asking themselves if this solution will really help them build the business they’ve envisioned and achieve their goals.

All membership solutions are not created equal and this is especially true when you’re dealing with a lot of customers. As your site becomes more and more successful there are two costs that will increasingly be of concern: support costs and opportunity costs.

Support Costs

Assuming that you aren’t working with a custom solution – which is a whole different kettle of fish – in general, your largest support costs will come from customers who have just signed up and need help getting started and from customers who want to modify their account in some way (i.e. change their billing information, upgrade/downgrade their membership, cancel their account, etc).

Reducing the number of questions about getting started can easily be achieved by putting together an FAQ section, video tutorials and other automated guides.

Reducing the support cost associated with customers who want to modify their account is a little more challenging because here the solution doesn’t lie in reducing the number of enquiries; the solution is to automate the process so that customers don’t have to call or email you every time they need something. Having a strategy in place for customer self-service is imperative to allow your business to scale and preserve profits at high volumes.

At the very least, the membership solution you use should have the ability to automate the cancellation process. Giving your customers the ability to cancel their own account not only decreases support costs, it also increases the customer’s trust in you. And for extra credit, on the cancellation page, make them a special offer in an attempt to “save the sale”. Most membership solutions don’t support this in an automated way, but you can fake it by making them the offer and having them send your support team an email to confirm.

Opportunity Costs

What are opportunity costs, exactly? Opportunity costs are benefits or profits you sacrifice when pursuing one course of action over another. Let’s look at a real-life example. Say that you’re thinking of quitting your job and going back to school. The opportunity cost in this case would be the loss of your salary for the amount of time you’re in school in school vs. the potential for future earnings after you’ve completed your education.

When working with a membership solution, an opportunity cost occurs when you have an idea that you know will be profitable, but you can’t implement it because you’re limited by the technology. When you’re faced with this situation, you have a few choices:

  • Hire a developer to customize your existing solution
  • Switch to another membership solution
  • Or… just forget about it 😞

Either way, you incur a cost and this is why it’s so vital to understand as much as you can about how you will use your membership site before investing in a solution. There’s nothing worse than leaving thousands of dollars on the table every month because you’re stuck with limiting technology.
monetize current members

Secret 2: Monetize Existing Customers

As marketers, we spend a lot time and money searching for qualified traffic and refining our sales message in order to increase conversions. All this effort is driven by the knowledge that the more we know about someone, the better chance we have to know what they want. The more closely our offer aligns with what prospective customers want, the more likely they are to buy.

Who do we know more about than our own customers? No one!

So why not sell additional products or services to them?

In a lot of cases we don’t do this because of technical limitations… and sometimes laziness. I can’t help you with the laziness part, but I can recommend that at the very least, use a membership solution that allows you to dynamically display relevant offers to your customers based on their purchase history.

Even better would be a solution that supports 1-click buying so customers can immediately take action on relevant ads (decreasing the number of steps in the process reduces the number of chances the customer has to change their mind). Ultimately the goal here is to leverage the knowledge you have about your customer to increase lifetime value.
member experience

Secret 3: Focus on Customer Experience

More than ever before, customers expect a lot out of their online experience. Good design, quality content and effortless usability are a must in order for people feel comfortable spending their money with you… and not ask for it back.

Good Design

The biggest slap in the face to a customer is to have been sold by a masterfully designed sales process only to come to the members area and have it look like it came from the dark days of Flash intros and the HTML blink tag. You’ll certainly hear the refund bells ringing if this is your approach.

Good design is extremely important. Since WordPress makes it so easy to implement a professional looking site and there are thousands of themes available for it, there’s no reason not to take advantage of it. For this reason, do yourself a favor and only look at membership solutions that integrate with WordPress; there are a number of them available that support all different levels of experience. WordPress also has an extensive plugin library that helps you take care of any additional functionality you want to include on your site.

Bottom line: Use WordPress. It’s a no brainer.

Quality Content

Most of us know that quality content is essential for long term success. Equally as important (if not more so) is your content delivery strategy. One approach is to just slap all of your content on a single page and say to the customer, “Ok, here’s your content. Have at it!” You might as well spray them in the face with a fire hose while you’re at it. This approach is overwhelming and even if your content is as amazing as this guy’s robot dance, it will scare away a large chunk of your customers.

Customers want their hand held. They want a 1-on-1 experience. They want to be engaged. Engaged customers will stay with you a lot longer and are much more likely to become self-proclaimed advocates of your product. To accomplish this, time-release your content over a period of time with “drip content sequencing”, or what I call content delivery schedules.

This actually isn’t much of a secret and every membership solution out there offers a way to accomplish time-releasing content. The differentiating factor is in how easy it is to implement. To do a reality check, imagine creating a content delivery schedule for two membership levels, say Silver and Gold, each of which have a year’s worth of content that’s released bi-weekly. If the solution you’re looking at allows you to implement this without calling in sick from life for a week, use that one.

Easy Usability

Another area where you can set yourself apart is by giving customers the ability to view and manage their own account information. By now, customers have had enough experience online with sites like Amazon, Facebook, eBay, etc. that they’ve come to expect this level of self-service. And with all the hoopla about credit card fraud online and the FTC cracking down, the more a customer feels that they are in control, the more comfortable they will be, which translates into increased retention. If you can allow them to change or cancel their subscription, edit their account and billing information or view their order history, you’ll differentiate yourself immediately.
profitable membership site secrets

Final Thoughts

If you’re interested in building one of the best membership sites possible, it’s vital to ask yourself these questions: Where will your business be two years from now? How many members will you have? What tools will you need to support double or triple your current number of customers?

Without a clear strategy, you could find yourself bogged down by support costs, leaving money on the table due to limiting technology, or losing members due to a sub-par experience. That’s the last thing you want to have happen.

By planning for success, monetizing existing customers, and improving customer experience you’ll increase your chances of building a profitable membership site.

Eric Turnnessen

Eric Turnnessen is the founder of MemberMouse. His absolute dedication to quality and insistence on perfection have made MemberMouse the premier WordPress membership plugin on the market today. His attention to detail and commitment to continual improvement make MemberMouse the #1 choice for business owners looking for a reliable and scalable membership solution.

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