Just get every one of these people to give you $50 a month, and you're all set. That's the idea, right? Let's explore whether membership sites are really THE answer or not.
I’ve heard a lot of talk about continuity programs lately. Continuity is just another word for “membership site” of course. Let me be clear: membership sites can be highly profitable. It’s a great model to follow, and if you’re interested in building a membership site, this post is NOT meant to discourage you from doing so. But, but, but…there’s a huge “but” here; there are 2 important myths about this business model that I don’t see being addressed, so I’m gonna do it here.
Membership Site Myth #1: Membership Sites are a Great Way to Make a Lot of Money Quickly
You know how many articles I’ve read that say something like “Do the math. Just charge $50 a month and get 200 members. All of a sudden you’re making $10k a month.” Dude, nothing is quick and easy. I hope I’m not bumming you out here…my goal really is to save you some valuable time, so you can stay on track.
Don’t look at membership sites as some quick way to make cash. Yeah it’s true, if you charge $50 a month, all you have to do is get 200 members to make more money than most people on the planet. So what? It’s not any easier to sell 200 memberships for $50 a month than it is to do anything else that will make you the same amount of money.
If you want to start a membership site, you should. But it’s the same with anything…do it because that’s what you want to do. Do it for these reasons:
- You want to build an ongoing, lasting and long term relationship with members who value what you have to teach.
- You want to have an ongoing conversation with committed members who are willing to pay for the value you offer, instead of people who just demand everything be free.
- Build a membership site because you want to use it as a smart front end to your sales funnel. Charge a very low price, creating a reasonable hurdle for people to get on board with you, and then give them huge value, and upsell them on premium, totally kickass products or services after they’re members.
Build a membership site for these reasons. It’s not quicker or easier to get rich with a membership site than it is doing anything else.
Membership Site Myth #2: Membership Sites Provide Stable, Predictable Income
When it comes to building a business, many of us are easily lulled by the promise of anything “stable and predictable”, but let’s look at the facts…membership sites are a lot of work. I want to repeat…this is not a BAD thing. Membership sites rock, but I have just seen so much misinformation about them lately that I wanted to take a minute to set the record straight.
What a lot of the top marketers out there will tell you is that a lot of the work can be outsourced, and this is true. But it’s still ongoing work that you’re accountable for completing. This is what happens with membership sites that you may not automatically consider:
- Not every member pays every month. Payments don’t always go through. Credit cards are rejected. If you run a membership site, you’re also signing up for the role of bill collector.
- By running a membership site, you’re not creating passive income. You will still need to create ongoing content. Yes, that content can still be resold, but that requires a new launch and more work. This can be done with a traditional product as well. Membership sites are not superior to traditional products with regards to passive income. Neither produce passive income.
- Once someone becomes a member, that doesn’t mean they’ll always stay a member. Membership attrition (people dropping out) is a regular part of the membership site business. You still need to continue your marketing efforts and provide huge value to your members in order to keep your numbers up.
My solution
So if membership sites are not the magic solution, what is? Ha. You’re kidding, right? There IS no magic solution. Membership sites are awesome. My only point here is one thing: other business models are awesome too, and there is no magic bullet. For me, I am simply going to continue to focus on selling traditional products and consulting. I don’t rule out the possibility of ever running a membership site in the future, but I have no current plans to run one. The reason is not because membership sites aren’t profitable and a great business model. They can be. But I prefer my own approach, which is to simply sell products and services.
Look, I can build a site and charge members $50 a month, or I can sell a product which has all the same information and sell it for $600. That’s the same income as someone staying a member with me for an entire year, which is rare, and I get all the money up front. Which model makes more sense to you?
Yes, I need to continue to market what I do. I need to still prospect and follow up on leads. I still need to continually improve what I do, keep my offers updated and current. All of a sudden, membership sites and selling products for a fixed price seem to be very similar don’t they? They are.
Have you thought of running a membership site? Does this connect with you at all? Have you been reeled into considering a membership site business model by the lure of stable, predictable income? I know I have 
Hey Chris, this is a really good post. My favorite line: “It’s not any easier to sell 200 memberships for $50 a month than it is to do anything else that will make you the same amount of money.” Bingo! From my view, for $50/month you better be providing some *massive* value if you want people to stick with you for the long haul.
Right on Shae. Always good to hear from ya
It’s funny how things seem to come in waves, and one of the biggest trends right now seems to be membership sites. I’m all for it but just hope people are getting sucked into some false hope that it’s something it’s not.
One of the best no-nonsense discussions of membership sites is bmyers.com it is a membership site, but he offers a weekly tip and discusses how you need to show incredible value for your members.
Bill Myers also is also part owner in membergate a high end software platform for subscription web sites.
You’re right Christian, it’s a cool business model but, as with most legit things it takes time and a lot of hard work..plus Bill discusses choosing the right niche, building value etc.
I find his site offers tremendous value with forms, tips, even software.. Not an affiliate just a raving fan.
Thanks,
Joe
Yes Joe, MemberGate is one of the biggest solutions out there. That and Amember seem to be the two I hear of most commonly, although there are a few dozen out there I’m aware of. Thanks for the comment…are you building a membership site of your own?
It seemed like there are way to many membership sites out and they all claim to be very easy. It doesn’t seem like it. Greg Ellison
Yeah, it is what it is. I hope I was clear I’m not against the business model. I just see it being sold as yet another magic solution, and it ain’t that
It’s just one of many viable ways to make a living. It seems to me the ultimate deciding factor would be research. If your target audience would benefit most from a membership program, that should probably be a solution you offer. Otherwise, why bother?
Good post Christian. Certainly a recurring revenue stream is more attractive than items that provide one-off revenue, but the trade-off is the increased amount of time required to run the membership sites.
You’ve got to have some great content that’s of value to keep people interested.
What I find fascinating is that a lot of membership sites aren’t really what they claim to be. They’re just a training course that take a number of months to deliver. As a result the customer’s payments are spread out over a number of months. Once the course finishes, the payments stop.
Personally, I’m more interested in creating a community around my brand, probably offering a forum where they can interact with each other, and suggesting products and services that are appropriate for their needs.
Good point Allan. I’ve seen the exact same thing. I think delivering content over a period of time is fine…whatever works, right? But I just wanted to give this business model a shot to the kidneys today, because there’s a lot of people banking on it being some cure all…and there’s unfortunately a lot of marketers out there selling it that way.
Thank you for the interesting perspective on membership sites. I can’t help but point out that there are plenty of blogs, non-fee membership, and consulting sites that people thought they could make a lot of money on only to fail in the end. Also there are two reasons I can think of off the top of my head as to why we go into business. 1. To make money and 2. To do something we enjoy everyday. Otherwise there is no point, right?
So if all of the above is true, then successful business websites in general are not easy to create. If that is the case, then my question is – what is the difference between successful websites and ones that fail after time regardless of their model? I understand this specific blog is about myths of membership sites but I think it’s important to also mention that all successful business websites are challenging to make. Unless I’m wrong and there is a better way to make money on the web while enjoying your work?
Great feedback Matthew. Yes, any viable business website is a challenge. The reason is because no one parts with their money for no good reason. Sure there is always a small portion of the population who buy any dang thing you show em…but you can’t build a sustainable business on that. If you want to thrive, you have to be awesome, and that takes work.
I honestly believe in today’s world you can make a living doing almost anything. Technology is a huge part of that. My main tools are blogs, squeeze pages and email marketing. That’s what I’ve learned and enjoy to do most. But that doesn’t mean these particular tools are the “trick” to success in business. I simply know how to use these particular tools and show clients what I’ve learned. There is no trick to success. Blogging will get you there, if you’re willing to do the work. So will running a semi truck parts salvage business…if that’s your thing. You can make a great living doing anything. I just happen to see that blogging and a certain level of social engagement as being essential in all businesses, which is why I’m here. It’s where I honestly feel I can help the most.
I think it’s important to point out that the failure rate, as you mention, is high in all business endeavors. Negative people always point to the high failure rate. The failure rate is high in high school too, so I guess that means we should all drop out of high school, right? Good things are worth the hard work.
You ask if “there is a better way to make money on the web…”, Matthew. I’d argue there is only one way to make real money doing ANYTHING. Be awesome, and make awesome offers. That’s my prescription. If you do those two things, the only way you can lose is by quitting too soon
That was a great & well thought out reply! I have been reading your blogs for a while now and have enjoyed them very much. They have been quite insightful and consistently give very good pointers. I didn’t mean for my first comment to be so forward but I suppose my passion for self-starting a business couldn’t help itself. I appreciate the candor very much.
I have tried several times to start a business and haven’t been as successful as I would have liked, so I can certainly relate to the “There is no magic formula to quick success” viewpoint. But it’s a good thing I didn’t drop out of high school because I’m never going to give up on having my own successful business! I’m certainly in this for the long haul. I look forward to reading more!
Awesome Matthew
I’m glad the content is helpful to you. I hope to have the pleasure of talking with you further!
Hi Christian:
Thank you for the insight into starting membership/continuity sites. Just like with anything it takes time to build and develop the product and or service. Sometimes we think that prodct X will make us money, we need to step back at look at the overall picture. Yes, 200 people at $50 a month it’s great however people will automatically drop off and one has to work harder to keep current members from dropping off. Content is key.
Good to hear from you Jane. I remember talking with you on Twitter earlier
It’s tough to remember sometimes that value comes from us, not from the tools we use. A lot of marketing is angled toward convincing us that a particular tool or a system is going to make us successful. Ain’t gonna happen. Whatever tools you use, you have to add your own awesomeness. Awesomeness not included 
Twitter: berober
I am an owner of a fairly successful niche membership site (you guest posted on it just a couple of months ago) and I have gone about everything pretty much backwards. I started knowing exactly what I wanted to do… create a kick ass members only platform for real estate agents to become more professional and make more money. Since I’ve started I’ve learned an immense amount about membership sites, how they work, and most of the pros and cons.
I think you have to decide what medium the stuff you’re selling — be it knowledge, a product, a course, or something else — is most conducive to. Mine was a no-brainer as I market to a very specific group of people but I am creating content that I plan to repackage and resell as “products” in the future. There’s nothing wrong with getting paid twice for the same work right?
Anyway, great article, as usual. I’d love to return the favor and do a great guest post for you some time.
Oh yeah…nothing wrong with creatively using content more than once! Chris Brogan calls it being a buffalo content maker. I’m a big fan of not reinventing the wheel
I agree with you totally Ben. Knowing your business and what approaches are going to connect best with your audience is the solution here. It’s not a matter of which tool is better. I know your work and would welcome a guest post anytime.
Twitter: JavaCarl
It looks as if you have looked into this subject matter, and as always have made some good points. Somethings look good on paper,but never seem to go that way, has been my experence. You are right with the work load, it could just double. I can forsee your income Rollo Coastering, I am sure that some do just fine, with the right Outsourcing, In closing, anything is possible.
Hey Carl
Membership sites can be run well; I know people who do really well with them, but it’s just not a magic bullet. I always push for getting people away from the mentality that success comes from the business model or any particular tool. You can use the best tools in the world, but without skillful execution (which can only come from you!), it’s worth nothing 
Twitter: JavaCarl
what up with the comment script? Overlaying.
fixed
Hey Chris,
Great article! Although I don’t currently have a membership site, it was always at the back of my mind. But you make a lot of good points here.
The challenge is many fold- not only do you need to continue to bring value to your general readers in the hopes of converting them to clients, but you have to bring even greater value to your members.
If your ultimate goal to to work less so you can enjoy the lifestyle you want, this may be a challenge.
Even if you get a project manager to oversee things, what is to say they would have the same vision you do? The integrity of your site and all your hard work is at stake here.
Definitely not a decision to be taken lightly. Thanks for sharing your thoughts!
Awesome Michele…my point exactly! It’s not that running a continuity program is a bad idea. It’s just not a cure all, as it’s unfortunately marketed as being in many cases. Good to hear from ya
Great article Crhistian! It’s true. Just do a google search with any keywords and ‘membership site’ and you wind up with a plethora of sites that show you how to make money. Try finding a really successful membership site, now that’s a challenge. I’ve had my membership site up and running for 2 years now. I’ve been putting in tons of hard work and I am now seeing the labor of my efforts. Yes, I believe that membership sites, like any other business, can be successful but only with hard work.
Stuart
Thanks Stuart
Congratulations on your success with your membership site!
Good article. One thing that I have noticed is that many of the sites really promoting membership sites are… membership sites. Developing a site that has enough value to readers that they are willing and eager to pony up some cash for a membership is challenging, but sustaining existing members and building a member base with a membership requirement is really hard. Most of the traditional media has tried it and most have failed. The key is content. It has to be valuable, unique and constant. These are factors that are especially elusive.
I think membership sites are possible, but finding the right niche, building the right team and creating the perfect content are hard work.
Thanks for pointing out that membership sites are not magic bullets, but can be weapons in the hands of the right army.
Dave
WordPressConfig.com
Thanks for the great comment Dave! You’re right, membership sites are often fairly adamant about promoting the concept of membership sites
You’re definitely right that a solid membership site is possible…I know of many profitable ones, and you probably do too. It’s a totally legit way of going about things. I just saw a run on this idea being sold to newer marketers as some type of a magic bullet, and I felt compelled to speak my peace 