Membership sites are an increasingly popular business model for making money on the internet, particularly for bloggers. The income they generate is much greater and more consistent than that of Google Ads, making it a much more attractive approach. While running a membership site is not technically a form of passive income since you still need to maintain the site, it is a least a good way of making optimal use of your time. Each piece of content you create can make money multiple times over, instead of the single payment you may get for writing as a freelancer.
TL;DR
- Consistent – establish a good site and a good subscription and you’ll get a reliable monthly income
- Enjoyable – it’s nice to share knowledge, but it’s even nicer to get paid for it!
- Tribe – build a community and surround yourself with people just like you
- Competitive – there’s always the potential for competition, but if you pick a good niche and offer something fresh you can stand out
- High Effort – it can be a lot of effort, particularly up front, but the pay off can be exceptional
What is a Membership Site?
You may have noticed, in the last decade or so, that newspaper websites have gone over to a different business model. As hard-copy purchases and subscriptions started to drop off in favour of online content, media companies abruptly realised that they were making significantly less money out of display ads on their website than they were from newspaper ads. They needed a solution and many went with paywalls.
Put simply, a membership site is exactly that – a website with a paywall partitioning off some of a website’s content, making it only accessible to those who have bought a subscription. While newspaper websites initially got some criticism for this approach, they pushed the fact that their content is high-quality and takes significant amounts of research to create and, reluctantly, readers have come to accept it.
That is an important distinction – the essential feature of a successful membership site: You need to be able to provide something that’s worth paying for. If the reader feels like they are getting something of value, they will be willing to pay for it and you will get a consistent and [potentially] considerable income for the work you are doing. Create substandard content and you will quickly find your subscriber list emptying.
The content behind your paywall can take various different forms, including:
– Ebooks
– Webinars
– Online courses
– Podcasts
– Virtual conferences
Basically, some kind of digital product. You could also sweeten the deal by including discount codes and special offers exclusive to members, though it’s very rare for this kind of thing to be all that the paywall conceals.
How To Start A Membership Site
The most important step in building a membership site, as it is with many passive income business models, is finding a niche. Newspapers have their reputation to trade on and the resources to cover current events around the world, but a solopreneur will need to be a bit more specific. There are very successful examples of membership sites in the fitness world, photography, business coaching, investments and others. While a lot of these have practical applications, making them a somewhat easier sell, you can still get subscribers with niche interest content, such as history, gaming, gardening and other hobbies.
The ideal niche, as always, is one that has plenty of interest but not a lot of competition. Fitness, for example, is a very well-served niche and, unless you have something really innovative to offer, you will find it hard to carve out a customer base from the well-established names that currently dominate the space. It’s not impossible to make an impact, even in a saturated niche, but it’s a lot harder. While specialising in an extremely small niche could potentially mean that you can charge more for your content since there is no competition to undercut you, too small a niche will mean that you just won’t get enough readers to justify the effort.
With the need for high-quality content, it’s strongly advised to write what you know. If you have a personal passion for the subject, as well as a degree of expertise, it is far easier to provide your reader with valuable material that is worth their money. Creating a membership site purely as a source of income when you have no real interest in the topic will inevitably be an uphill struggle.
Sadly, jumping right in with posting content behind a paywall is not going to get you many paid subscribers. If no one knows who you are or what unique insight you can provide in your niche, they have no reason to believe that your content is worth paying for. Newspaper websites were able to pull it off only because most had decades of prior published content – in some cases, centuries of the stuff.
You certainly won’t need to run a website serving free content for over 100 years, but you will need to establish a solid membership base. You need to prove that you are a credible and trustworthy source of information by publishing good content for free. Using an email list or perhaps your site’s social media presence, you can gauge the extent of your readership, then start to introduce the idea of premium content that you would like your audience to pay for.
One important note here is that you will need to make sure that the premium content stands out from the free stuff. If you suddenly erect a paywall and readers find that the stuff behind it is exactly what they could read for free before, it’s likely that you will just upset and lose your established audience.
It is worth continuing to post free content, too. This could potentially include samples of the premium stuff – the introduction to a more detailed article, for example – but could also be more of the content you started out with. This will keep new readers coming to your site, will show your subscribers the gulf between your free and premium content, and will work as the top of the sales funnel for getting people to buy a subscription.
The process of actually creating the paywall is the easy part. There are plenty of sites that can help you to set up a membership site, such as MemberPress, WPEngine, Podia, ThriveCart, Wishlist Member and ProductDyno. All you need to do is continue to create content that is worth paying for.
Things to Consider when Creating A Membership Site
As we said at the start, membership sites are not a true source of passive income since they need constant work. There is no point at which you can sit back and earn money without doing any work. You will need to continually create content, both premium stuff to put behind the paywall and free stuff to attract new members. However, it is a good side hustle and an opportunity to make a consistent income from your passion.
You will need a few additional skills, beyond that which you want to monetise. In particular, you will need to be able to create compelling content in one form or another. You could hire an editor to go through your notes and improve the style of what you have written, but this adds an additional cost to the process. You will also need some skill at digital marketing so that you can start getting some readers onto your site.
It’s not impossible to make a good living wage from membership sites – there are some that make over $100k per year. However, it is challenging. If you find the right niche, produce high-value content and plan your pricing and marketing right, you could make running a membership site or two your primary source of income. However, it takes time to get to that level. Don’t expect to be making six figures within a year of launching your first site.
How Much Does It Cost To Get Started Creating A Membership
The exact cost of a membership site depends on the platform you use for setting it up. There is firstly the cost of just setting up a normal website, with hosting, the domain and the theme all on the shopping list. You will then need to sign up to a membership site system that enables you to collect subscription fees. This can be from around $150 per year, but the price will vary based on the provider and the package you buy.
Learn more about Starting A Membership Site
If you are interested in learning more about Membership Sites and how it can create you a passive income, check out these links:
How To Make A Membership Site That Makes Money – A great course from Udemy for those wanting to learn more
Thrive Cart – the best checkout platform I’ve ever come across. Great for managing products, subscriptions, affiliates and membership sites – integrates with all the major platforms
MemberPress – one of the longest running and leading membership platforms for WordPress
WooCommerce – another leading membership platform
WishList Member – easy to use membership building platform for WordPress