Free vs. Paid: What Kind of Membership Program Should You Run?

by | Dec 7, 2009 | Creating Products

To answer this question, you really need to understand the primary purpose of your membership site. What do you want the membership program to accomplish for you? Is it a list-building tool or a revenue model?

Obviously, if it is primarily a revenue model, then a paid membership program is going to help you accomplish your goal a bit faster. Membership fees create a steady, fairly predictable income. If you run a program with a monthly fee of $25 and you have an average of 100 members each month, then you know you’ll have an income of at least $2,500 every month or $30,000 each year.

So, you say, what benefits does a free membership offer? Let me list them for you:

  • They are a great way to build a list of fans.
  • They can reduce the number of “tire kickers” you have on your list, because they do need to jump through a few more hoops.
  • They help create rapport between the business owner and the members.
  • They can build a sense of community, depending on what model you use.
  • They can establish credibility and, possibly, even celebrity status.
  • They can make you money.

What? you say. It’s a free program, how does it make me money? Well, you can promote your products and services through the site. People would get angry if you did this with a paid site!

If this still doesn’t work for you, you could try developing a low-fee membership program, say $5 or less a month. This way you get the benefit of having at least some residual income, and you can actually increase the quality of your members!

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