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The Ultimate Guide to Running A Successful Membership Site

Some of today's most successful online entrepreneurs are building membership sites to deliver their online courses.  Whether you are just getting started on your journey or are a seasoned course creator, this guide will help you build and grow your profitable and sustainable membership site.  I look forward to being Business Boss Besties 😍

Running A Successful Membership Site

Membership Sites Defined

Membership sites differ from standalone courses in a few key ways, including in the expectations of your students and what is required of you, the site owner.

1. Recurring Revenue - Students pay a regularly recurring subscription fee to gain and maintain access to site contents.  Recurring revenue is attractive for its predictability and lifetime value potential.

2. Ongoing Training - Students expect new training on an ongoing basis, with a mutual exchange of value. Students continue to pay a subscription fee, and you continue to provide them with new training.

3. Building a Community - Membership site students typically expect access to you, the instructor, and to each other. Access to a community of like-minded people is a major selling point of most membership sites.

4. Emphasis on Retention - The membership model relies on retention. By maximizing retention rates, you increase the lifetime value of your customers - ideally to a greater value than the one-time purchase price of an online course.

Member Onboarding

What makes the membership site model work is member retention.  If you are unable to retain your members, it will be very difficult to build a profitable membership site business.  Once the sale is made, that's when the work of helping your students succeed begins.  That is what a member onboarding process is for.  Member onboarding is the process of integrating a new student into your membership site effectively.  The goal is to get them up and running, consuming your content, and experiencing positive results as quickly and as smoothly as possible.  Make new members feel as though you're there for them.  Make your new member automatically feel like they've definitely made the right decision.  A few things you can do to create a positive and welcoming experience for new members in your onboarding process.

1. Customize your welcome email: The signup confirmation email is the perfect opportunity to create a great first impression.  Use this space (and your personality) to further reinforce the purchase decision your student has made and get them excited about the journey ahead.

2. Conduct a welcome phone call: Consider asking for your student's phone number in your sales or checkout process.  A personal phone call is a powerful way to build rapport, creating a wow moment, and immediately reducing the likelihood of membership cancelation.  Another option is offering to have a quick call with them (perhaps within your welcome email), to let them decide whether or not they'd like to hop on the phone with you.  In most cases they will take you on the opportunity, and will be grateful you offered it to them.

3. Include a welcome video: When a student logs into your membership site, the first page that they will see is the Member Dashboard (aka the Member's Area).  This is a great place to include a welcome video for new members.  Your welcome video should contain some of the same messages that you include in your welcome email, plus an overview of how to navigate their way through the various pages and lessons in your membership site.  

Before You Launch: Test Everything

Before you launch your membership site, or immediately after you make any changes to a membership site that is already live, test everything.  Go through the entire sales process as if you were a new member, including payment and registration.  Make sure your payment is processed properly, your membership is set up correctly, and you receive the correct welcome emails.

HERE ARE A FEW THINGS TO KEEP IN MIND:

1. User-friendliness: how easy is it for you to navigate your
way around the membership dashboard?
2. Brand consistency: does the overall look and feel of
your membership site match the look and feel of your main
website?
3. Mobile responsiveness: What does the membership
dashboard look like when accessed from a mobile device?
4. Site speed: how fast does your membership dashboard
load? Are you able to watch and/or download lessons quickly?
5. Different browsers: how does your membership dashboard
look on different browsers? Are there any noticeable changes
or issues?

Content

At the heart of every membership site is the content itself.  Therefore, it is critical that you create content and training that is both relevant and helpful to your customers, and organized in a way that makes sense.  Don't overwhelm your members with all of your content.  Welcome them when they first join with a guided tour and then break up your content into well-organized areas. Create content for different learning styles.  Everyone has their own unique learning style, and it's important to understand what the most common styles are.  That way, you can intentionally create content tailored to all your members who may have different ways of learning information.

 Different types of content to create:
How to come up with ideas for new content:
• Talking head video
• Screenshare
• Voice over slides
• Audio training
• Worksheets, templates, checklists
In addition to the main course curriculum, membership site students expect access to new content/training on a regular basis. Here are some ways to come up with ideas for new content:
• Regularly ask your members what they’d like to learn about next
• Pay attention to the questions that your members are asking (in discussions, private groups, and support emails)
• Follow industry news & trends (create a Google Alert for specific keywords related to your topic)
• PDF slides
• Live training (webinars, Facebook Live, etc.)
• Interviews with experts
• Video tutorials

Community

One of the key components that makes a membership site successful is a community. Very few people purchase an online course just so they can access the content. For the majority of membership site students, becoming a part of a community of like-minded people is a huge incentive for signing up for (and staying a part of) a membership site.  At a minimum, your membership site should have a discussion feature enabled so that your students can ask questions and offer support to each other. A discussion feature also allows students to directly ask their questions as they progress through the training.  Nearly every successful membership site owner also has a private Facebook Group for its customers.  

Sales & Marketing

Top 5 ways membership site owners are optimizing their sales and marketing processes to attract and convert their members

#1: Testimonials & Case Studies

Social proof is an incredibly powerful persuasion technique. When potential customers see that other people have already joined your membership site and had a positive experience, it gives them confidence (and proof!) that other people are getting value from
your membership site.  Collect positive testimonials from your members, and use those testimonials in your marketing materials
and on your membership site sales page.

#2: Free Trials
Free trials are a great way to give potential students a risk-free way to experience your membership site for a limited amount of time. Knowing that their free trial will expire also provides a sense of urgency to upgrade to your paid membership.  Although the majority of people are honest, to protect yourself from people who sign up for your free trial, consume all your content, and then cancel their subscription, you may want to consider restricting the amount of content you include in a free trial. Another option is to drip feed your content to your students.  This approach requires them to maintain their subscription in order to access upcoming content or
training.
#3: Affiliate Programs for Members
The least expensive form of marketing is word-of-mouth (aka referral) marketing. If your existing customers are happy with their experience, they will likely begin to refer other like-minded individuals to your membership site as well. Why not reward them for doing so?  Create an affiliate program for your membership site, and then invite your existing customers to become an affiliate for your business. By providing them with a unique link to your membership site to share with their network, you can track, and therefore reward, your customers for referring additional customers to you.  Pros & Cons of offering an affiliate program so you can decide if it is worth it for your business model before you spend time and energy creating one.

PROS OF OFFERING AN AFFILIATE PROGRAM

A. It promotes brand awareness – other people talking about your site will put you and your brand in front of a lot more people than if you’re doing all the promotion yourself.

B. It can increase website traffic and leads – done right, an affiliate program will increase the number of people visiting your website and entering your sales funnel.

C. It should increase sales – if your sales page or sales funnel are good, then the increased leads will result in increased sales and a boost in members for your site.

D. It creates an ‘army’ of advocates – hearing your site is good from somebody else is much more powerful than hearing it from you yourself!

E. It’s one of the most cost-effective marketing options there is – you only pay when a sale is made, so you’re not taking any risks with your money or spending more than you might get back.

F. You can completely tailor it to your needs – it’s up to you how you run your affiliate program, there are no hard and fast rules, so you can do what works best for you and your site.

CONS OF OFFERING AN AFFILIATE PROGRAM

A. It requires an ongoing commitment – like membership sites themselves, affiliate programs are a marathon not a sprint.

B. It may not be suitable for your audience or product – if you know that people need to have had personal interaction with you before they buy, then an affiliate program might not be your best choice.

C. Affiliate management  – depending on the size of your affiliate program and how you choose to run it, dealing with affiliates and the running of the program can become time-consuming.

D. It means an additional tech system to set-up and maintain – this isn’t necessarily an issue, but it’s worth bearing in mind if you’re not a fan of tech.

Who Can Become An Affiliate?

One of the first things to consider when setting up your affiliate program is how you will recruit your affiliates. Your program could be:

  1. Members-only – only people who are members of your site can become affiliates for it.

  2. Public  – anyone who wants to can become an affiliate.

  3. Invite only – you hand-select a few people to become affiliates for you.

I am personally a fan of the members-only option for membership sites as this approach increases the likelihood of attracting new members who are a good fit for your site. If you decide on a public affiliate program then you are likely going to want to have things like an affiliate 'sales page' on your website that tells people of the benefits of your program and what they are promoting. 

What Commission Should Be Given?

The commission rate that you decide to give to your affiliates can be an important factor in the success of your program (both for your affiliates and you).

Some things you should consider when deciding on your commission rate:

  • Will you use a flat fee or a percentage?

  • Will you pay recurring commissions or one-off only?

  • Do you want to offer 1 or 2 commission tiers?

  • Will your commissions increase over time at all?

  • Do any competitors have affiliate programs?

You can effectively set whatever commission rate you would like, but it needs to be attractive enough to affiliates to make it worth their time promoting your site, but still provide a good ROI (return on investment, or profit) for you.

The commission for membership affiliates is typically lower than is often recommended for digital products or courses, where you may find 50% or more suggested. It’s important to remember that the recurring model is different from selling a one-off product when deciding on your rate – you will be doing ongoing work to keep that member each month, whilst the affiliates work is done after the initial sale. So, giving something like 25% on a recurring basis is more typical for a membership.

Of course, if you’re only paying a commission on the first payment rather than on a recurring basis for the lifetime of the membership, or you’re using a flat fee structure, then you may

#4: Application Form
Requiring potential students to complete an application form in order to sign up for your membership site helps to prequalify
your students, while simultaneously discouraging those who don’t really want to join from doing so (if you weren’t seriously interested in signing up, you wouldn’t fill out an application form!).  

#5: Price Tiers
Creating different price tiers for your membership site is a great way to reward your customers for their loyalty by discounting their subscription price based on how long they commit to being a customer.  For example, creating different price tiers for your membership site; students can pay monthly (Tier 1), annually (Tier 2), or bi-annually (Tier 3)

Understanding Metrics

As a membership site owner, there are specific metrics that reflect the overall health and success of your membership site. If you know your numbers, you know your business. 
The great thing about tracking these numbers is, simply by tracking them, you are more likely to think of ways to improve them. What gets measured gets improved.  We talked to successful course creators to narrow down the key metrics that membership owners are tracking and actively improving on a regular basis.  

IMPORTANT METRICS EVERY MEMBERSHIP SITE OWNER NEEDS TO KNOW

1. LTV (LIFETIME VALUE): 

Average customer lifetime value (LTV) refers to the average dollar value that a customer is worth to you over the life of their membership. Knowing your average customer LTV will also help you determine how much you can spend to acquire a customer and still be profitable.
Example: 
Monthly subscription fee: $100 
Average retention length: 8 months 
Average customer LTV: $100 x 8 = $800

2. CHURN RATE:

Churn rate is the rate at which your students cancel their subscription. To calculate your monthly churn rate, divide the number of members who canceled their subscription in a given month by the total number of active members you started that month with. For the purpose of calculating churn, you ignore any new members who joined during the same time period.
Example: 
Total active members 30 days ago: 100 
Cancellations in the past 30 days: 10 
Monthly churn rate: 10 / 100 = 10%

3. GROWTH RATE:

Your growth rate is the rate at which you are adding new members to your membership site over a specific period of time (weekly, monthly, quarterly, etc.). To calculate your monthly growth rate, for example, you would divide the total number of active members you added in the past month by the total number of active members you had a month ago. Then, multiply that number by 100 to get a percentage. 

Example: 
Total active members 30 days ago: 480 
New members added in the past 30 days: 45 
Growth rate: 45 / 480 = 0.094 x 100 = 9.4%
In order to run a sustainable and profitable membership site business, your growth rate needs to be greater than your churn rate.

4. CONVERSION RATES:

Conversion rates apply to virtually any process where you are asking someone to take a specific action. The conversion rate of that process is the percentage of people that take that desired action. Here are two common conversion rates that membership site owners should be tracking:
Sales page conversion rate: To calculate your sales page conversion rate for a specific period of time, divide the number of people who signed up for membership site by the number of people who visited your sales page. 
Example:
50 new members / 200 sales page visitors = 25% conversion rate

Free trial conversion rate:
To calculate your free trial conversion rate, divide the number of people who signed up for your paid membership after completed your free trial by the number of people who signed up for your free trial. 
Example:
20 paid members / 50 free trial members = 40% conversion rate

You need to provide a tribe and friend like experience in your membership.  

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