How To Set Your Membership Pricing

You have started a membership website to satisfy a market requirement, and yes, you want to make money from it.

But how do you set your membership pricing?

You might check out competitor prices, and you set yours by using it as a benchmark. You could look at your cost and add a little margin. You just follow your instincts and keep going.

So what is the best membership pricing strategy among all of these? All these approaches can work, but they all leave money on the table. The most profitable membership pricing approaches put customer value in front and are driven by your customer’s interests and purchasing habits. 

So let’s find out how you can increase the money your subscription website makes and sustain your recurring revenue business. 

We will walk through why understanding how to price a membership site is important, outline common membership pricing strategies, and explain what should be the subscription model you must follow.

Things to consider when pricing a membership website

When it comes to membership pricing, there are several factors to consider, but make sure to choose the one that works the best for your business. 

So let’s jump into the important factors that influence your membership pricing.

Subscription business type

First, define what kind of content or product you are going to create for your subscription business. Can you present the content as a “premium deal” to your prospects? Or is it a budget offering? When pricing your membership services, understand the value you want to give your members so that you can decide what to charge.

Your target market

Before starting your membership website, perform thorough market research. Learning about the market you want to enter helps you understand the market expectations, trends, and pricing. You must also look at your competitors’ pricing, as it gives a basic idea about what your target market is willing to spend. 

How much is your audience willing to pay?

When it comes to the willingness of your audience to pay for your subscription services, each one has a different idea of a fair price, and hence it isn’t easy to find out the amount they are willing to pay. So what you can do as a content creator is to conduct market research and understand more about your ideal customer base. If your target audience is too broad, niche down your services to come up with content that works for all your users.

The revenue you want to make

Another excellent way to come up with the right membership pricing is to calculate the price backward from your expected revenue.

For example, make a plan about the amount of revenue you want to generate in a given time frame. That is, how much money do you want to make every month or per year to cover all your expenses and make a profit? 

Once you come up with the final number, divide it by the total number of subscribers you want to get in the timeframe.

For instance, if your goal is to make $5000 every month, you must get the following:

  • 20 subscribers who pay $250monthly.
  • 100 subscribers who pay $50 monthly.
  • 500 users who pay $10 monthly.

Remember that it isn’t easy to get a large subscriber base when calculating your membership price on this theory. And it might actually be expensive to attract more subscribers to your membership website.

But make sure you work on this by offering unique and premium offerings to subscribers and trying out a combination of revenue approaches to cater to different audiences.

Your unique selling point

All membership businesses that do great will have excellent unique selling points or USPs. This differentiates your business from the crowd and assures that you offer unique content. 

By defining your USPs, you can position your subscription service in the market by differentiating the unique value you provide.

Member churn rate

When pricing your membership services, do not forget the subscriber churn factor. Theoretically, your subscribers must stick with you for long. But the reality is that many people would leave your membership site for other services, and when pricing your services, you must also take it into account. 

If you are new to the term, the churn rate is the percentage of people who leave your subscription website during a given membership period. According to data, average subscription-based platforms experience a 6.7 % churn rate every year.

But it is difficult to forecast the churn rate you must expect without having any data. The easy way is to calculate your monthly churn rate by analyzing how many people abandon your membership website every month.

Overall costs

Another important thing to consider when choosing the membership pricing strategy is your overall costs and expenses. This can include your online tutoring software price, domain, web hosting, other tools, maintenance costs, and related costs. To keep your subscription business profitable, make sure the revenue you generate always covers all of your expenses, at least the minimum.

Membership pricing models to follow

If you want to start a membership website, you need a membership model that does two main things:

  • Keeps non-members out of the site.
  • Make people actually want to pay you. 

Before launching your membership website, it is significant to consider different factors you must consider in your pricing strategy. Now that you know about the factors to consider, let’s get into the common membership pricing strategy you can adopt to power your subscription service. 

Fixed pricing 

Fixed pricing, also known as flat pricing is one of the common membership pricing strategies you can adopt. Fixed pricing is simple: A fixed type of offering, a features that doesn’t change, and fixed pricing per month.

Fixed pricing is excellent as it is easier to communicate and easier to sell to the audience. You can hike your rate if you want to add more valuable features or additional products or content. 

Flat-rate membership price can be easier for your potential audience to understand, often bringing in more revenue for your business. 

Suits best for: Subscription businesses with single buyer persona and limited features. Fixed pricing doesn’t work great for businesses where resource costs vary between users. 

Benefits of fixed pricing model

  • Easier to explain to clients and sell to them.
  • Easy and simple payment processing and billing.
  • Improves the productivity for businesses to shift their work on revenue generation and retaining subscribers. 

Tiered membership pricing

Tiered membership pricing is where subscription businesses offer multiple price packages with different product and service offerings. The number of packages can vary, but most subscription businesses offer two, three, or a maximum of four pricing tiers.

Tiered pricing allows subscription services to differentiate the pricing of different offerings according to different target audience.  Generally, the tiers are basic, standard, premium, etc. Pricing iers must have unique features to make the value difference extremely clear. 

Suits best: Membership businesses that have many offerings and a large users base with different requirements, usage, and budget.  

Benefits of the price-tier model

  • Flexible pricing model and sustainable.
  • Suits users with diverse needs.
  • Improves the customer’s lifetime value as they choose to change the tier as the requirements change. 

Usage-based pricing model

Now coming to this membership pricing model, it is a consumption model or pay-as-you-go. This makes this pricing strategy becomes more variable as it is charged based on the usage consumption of users. This involves a fixed basal rate, and users are charged for additional usage.

Suits best for: Subscription businesses of which users’ usage consumption is expected to differ considerably. 

Benefits of consumption pricing model

  • Offer users the flexibility to pay based on their usage.
  • Attracts new subscribers with minimum costs if usage is low. 
  • Users whose content consumption is more might be charged more than users who don’t consume the resources frequently.

Build your membership website

Fanso simplifies the process of building your membership website and helps you to be flexible with your pricing strategy and selling. Fanso is a ready-made community marketplace script that can help you build your membership platform based on your required customizations.

If you choose a community platform script like Fanso, you just need to pay for the hosting and other plugins you will need for your membership platform.

Fanso comes in 2 pricing plans, “Starters” priced at $699 and “Professionals” at $1499, which is a one-time cost with no monthly or yearly renewals. 

Set a monthly subscription fee, a one-time fee, etc., for your clients to access your subscription services. With Fanso, you can keep all your revenue. We do not take a commission from your earnings; we just charge a one-time fee and don’t charge any transaction fee. Being said that, you can make money through your subscription business through commissions. 

Build a thriving online community for your membership website using our engagement features and exchange deals with peers and creators. 


The first step in choosing membership pricing can be challenging. Do not fall into the trap of analysis and paralysis. Doing initial research and analysis about your target market is great, but never make decisions blindly. Be flexible and ready to revise membership pricing as your business grows and markets change.

Want to gain some inspiration to convert your business idea to a full-fledged membership platform? Get in touch with us right now to partner with the industry’s best online tutoring tech partner to bring your ideas to the table. 

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